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illennials and Gen Z are eager to step into homeownership, yet the current climate of high prices and steep mortgage rates makes the goal feel out of reach. Real‑estate expert Amir Korangy argues that buying a house may not be the best move right now.
“Buying just because you’re at the right age isn’t a solid reason,” Korangy, founder of The Real Deal and professor at Columbia and NYU, told Fortune. He points out that the market’s conditions make ownership less attractive.
ServiceLink’s latest data shows a strong desire for homes among younger buyers, but many are forced to abandon the dream because of cost. Mortgage rates hover around 6 %, and home prices are 55 % higher than they were at the start of 2020, according to the Case‑Shiller index.
In this environment, renting often comes out cheaper. A June Realtor.com study found that renters save over $900 a month on average, and that renting remains more affordable than buying in 49 of the 50 largest U.S. metros—Pittsburgh being the sole outlier. Korangy champions the “freedom of renting,” arguing it offers better value.
“For the same monthly payment, a buyer with a $3 million budget could rent a property worth $5.5 million to $7 million,” he explained. “That’s a smarter use of money.” He also highlighted the hidden costs of ownership—insurance, repairs, property taxes, HOA fees, landscaping—that add up beyond the mortgage.
Insurance premiums are rising 8 % nationwide, with even steeper hikes in Florida and California due to higher weather risks. These additional expenses erode the financial advantage of owning.
Equity growth, once a key incentive for buying, has slowed. Home‑price appreciation has flattened or declined across the country, and the average homeowner lost about $9,200 in equity over the past year, according to Cotality data. Real‑estate advisor Leo Pond described the shift as a long‑term market correction rather than a collapse.
Korangy says that if building equity isn’t a priority, renting is the logical choice. Renters aren’t tied to market fluctuations, can move freely, and aren’t responsible for building‑related issues. “You’re not beholden to the property,” he notes. “That flexibility is a major benefit.” He stresses that ownership isn’t a one‑size‑fits‑all solution and that many people can gain more from renting.
