Gen Z is still young - the oldest members are only approaching age 29. Yet they just set a record in the housing market. During the second quarter of 2026, Gen Z accounted for 20% of all rate locks for home purchases, a new high. That number has never been higher.
This milestone comes from Intercontinental Exchange's (ICE) Mortgage Monitor report, which has long tracked mortgage rate locks as a leading indicator of homebuying activity. The growing share of young buyers reflects both demographic shifts and the increasing use of financial tools - such as government-backed loans and down payment gifts - that help first-timers afford homes in a persistently expensive market.
The generational handoff in homebuying is also a response to market conditions. With home prices climbing and inventory tight, younger buyers are leveraging every available option - from FHA loans to family gifts - to secure a foothold. This shift is prompting lenders to adapt their offerings as more first-time buyers enter the market.
The data from ICE's report prompted Andy Walden, who oversees housing and mortgage research at the firm, to remark, "Gen Z's rise to nearly 20% of rate locks is one of the clearest signs yet of a generational handoff in the homebuying market." The handoff is happening as Millennials already hold a large piece of the market.
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Home prices are still climbing. In June 2026, annual home prices rose 1.3% - the fastest pace in over a year. Nearly 72% of housing markets had prices higher than a year earlier, and nearly 91% saw monthly gains.
Young buyers are using creative tools to afford a home. Gen Z relies heavily on government-backed loans. They made up 27% of all FHA purchase lending. FHA loans are mortgages insured by the Federal Housing Administration, which allow smaller down payments. Additionally, nearly one-third of all mortgages for first-time buyers went to Gen Z.
Down payment methods are shifting too. 71% of buyers still use personal savings. For Gen Z, 13% received a family gift for their down payment, and 8% took out a loan.
Older generations are not sitting out. Boomers accounted for 31% of cash-out refinance activity in the second quarter. A cash-out refinance is when a homeowner replaces their mortgage with a larger loan and takes the extra cash.
Boomers only made up 11% of purchase lending - a much smaller share. They are tapping the equity in their homes rather than buying new ones.
ICE expects Gen Z's share to keep rising as more members enter their prime homebuying years. Lenders must guide first-time buyers on options like government-backed loans, help with down payments, and other creative approaches. Home price growth could moderate if inventory continues to increase. ICE Mortgage Technology's president, Bob Hart, described the shift as "more than a demographic footnote, it's a competitive inflection point." The generational handoff is already underway, and it is reshaping who gets a mortgage.
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