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Birmingham is the third-most-popular metropolitan area in the U.S. for home ownership among Generation Z, according to a recent report by online mortgage marketplace LendingTree.
“Our findings illustrate that Gen Zers make up a noteworthy share of homebuyers in many of the nation’s largest metros. While this doesn’t undercut how difficult it can be to buy a home — especially for younger buyers without as much cash or experience in the housing market — it helps dispel the myth that homeownership is impossible for all young Americans,” LendingTree’s report reads.
Gen Z accounted for 20.79 percent of mortgage requests in the Birmingham metro, less than 2 percent below first-ranked Salt Lake City. RentCafe similarly ranked Birmingham 12th out of 50 in Gen Z home ownership increase in the last five years — when the oldest members of Gen Z were 21. These data reflect a national trend studied by Redfin: 30 percent of 25-year-olds owned their home in 2022, more than both millennials and Generation X at age 25.
“Birmingham has been an attractive destination for young professionals due to its affordability, growing economy, thriving food & beverage culture, and entertainment outlets. Generation Z has now fully entered the mix as the newest crop of young workers,” Chris Wood, vice president of the Birmingham Association of Realtors (BAR), said. “Based on statistics, we’re expecting roughly 7,000 new residents in the Birmingham Metro Area in the next year, and my experience as a Realtor can say that a good portion of those new residents are young professionals getting their start here.”
According to home price indices, prices in Birmingham have increased nearly 72 percent since 2015, when the oldest members of Gen Z were 18, but the national average increased 81 percent during the same period. Interest rates on 30-year mortgages have increased nearly four points since 2020. Housing prices across the nation are up, and mortgages are more expensive. Birmingham is not a haven, but it may emerge among the least-bad options.
“It is good for the city and the state, absolutely. As the state grows and changes, we need to be excited that home ownership among young people is continuing to grow here. I feel strongly that these young buyers are building a bright future by realizing investing in a home is one of the best financial decisions they can make,” BAR President Keith Kelley said. “By having a strong, young buyer base, the housing market for the city can only be improved.
