The Financial Feasibility of Purchasing Childhood Homes

Desire to Revisit Childhood Homes

There is a common adage that states, "you can never go home again". However, almost half of all adults would willingly contradict this saying if they had the financial means. According to a recent survey conducted by Zillow, 44% of Americans would purchase their childhood homes if money was not a constraint. However, only half of the adults surveyed believe they could afford their childhood homes at current market prices. The survey also revealed that a larger proportion of millennials and Gen Z adults would buy their childhood homes today. This trend seems to be an extension of the nostalgia wave that has swept across pop culture, social media, fashion, and marketing, and now extends to housing.

Nostalgia and Affordability

Manny Garcia, a senior population scientist at Zillow who spearheaded the research, suggested that younger generations' nostalgia extends beyond fashion and toys to a simpler time in their lives. He suggested that these individuals associate their childhood homes with comfort and safety, devoid of adult responsibilities such as rent, mortgage payments, maintenance, insurance, or other housing-related challenges. However, a comparable home today may seem unattainable, particularly for younger adults who aspire to homeownership but face significant affordability challenges.

Generational Differences in Homeownership

According to the survey, individuals born in the 1980s and 1990s are most likely to express a desire to purchase their childhood homes today, at 62% and 55% respectively. However, nearly half of those born in the 1980s and almost two-thirds of those born in the 1990s believe they could not afford their childhood homes at current market prices. These potential buyers would now need a six-figure income to afford the typical U.S. home. While younger generations may yearn for the housing market of their youth when prices were lower, their parents likely faced similar, if not more severe, affordability challenges in the early 1980s. For instance, in 1981, mortgage rates skyrocketed above 18%, pushing the typical monthly mortgage payment to 55% of the median income at the time. Today, a new homeowner's mortgage burden represents nearly 40% of a typical income, which is still significantly higher than the 30% threshold considered affordable.

Access to Affordability Resources

Despite these challenges, today's buyers have easier access to affordability resources. For example, home shoppers can find down payment assistance programs they may be eligible for on Zillow's for-sale listings. They can also use online affordability tools to better understand how much they can comfortably spend on a home and shop for homes based on monthly payment, rather than purchase price.

Childhood Dreams vs. Adult Realities

Interestingly, while many adults aspire to buy their childhood homes today, their dream homes as children likely looked very different. The majority of adults surveyed said that their childhood dream home included a pool (77%) and/or a home theater (73%). Today, 72% of adults would still want a pool, and 76% would want a home theater in their current dream home, suggesting that some dreams persist. However, practical features often take precedence when reality sets in. Most adults now dream of a home with air conditioning (89%), a walk-in closet (89%), and a laundry room (85%). Despite this, a significant proportion of adults still harbor childhood dreams of having a bowling alley (43%), a frozen yogurt or soft serve machine (34%), and a soda vending machine (24%) in their homes.

Generational Differences in Dream Home Features

The survey also revealed that not all generations dreamed of the same home features. For instance, 58% of those born in the '90s dreamed of having an elevator in their home, compared to only 21% of those born in the '50s and earlier. Similarly, there was a 35-point gap for Jacuzzis and hot tubs. On the other hand, 38% of those born in the '50s and earlier dreamed of a home with a white picket fence, while only 21% of those born in the '90s shared this dream.

Conclusion

This article raises intriguing questions about the intersection of nostalgia, generational differences, and housing affordability. What are your thoughts on this topic? Would you buy your childhood home if you could afford it? How do your childhood dreams of a home compare to your current ones? Share your thoughts and this article with your friends. Also, remember to sign up for the Daily Briefing, which is delivered every day at 6pm.