In 2024, 11.2% of American households moved in the preceding twelve months, the lowest level in twenty years of ACS data. Prices are declining in several metropolitan areas, but this correction is insufficient to resolve the major obstacle posed by the initial down payment for young adults. Access to homeownership remains constrained by prices, interest rates, incomes, acquisition costs, and the ability to accumulate a down payment. Several countries face the same situation.
The Essentials
- In 2024, 11.2% of American households had moved in the preceding twelve months, the lowest level in twenty years of ACS data, and net international migration is expected to fall in 2026 to approximately one-third of its 2001-2019 average, slowing household formation and housing demand in major metropolitan areas (Harvard JCHS 2026).
- Household formation is slowing structurally due to student debt and economic uncertainty, even where the price-to-income ratio appears to be improving.
- In France, the average down payment of a first-time homebuyer reached €57,844 in 2025, representing 22.7% of the purchase price (CAFPI), and this average down payment has increased by 33.2% since 2019 (Credit Housing Observatory/CSA, Q3 2025); in Germany, it is generally recommended to mobilize 20 to 30% of the price, plus acquisition costs, in a country where 69% of 18-34 year-olds are renters, versus 38% on average across Europe.
- The initial down payment remains the blocking threshold: in metropolitan areas where jobs concentrate, it represents several years of net income for an entrant.
- Policy choices in 2026-2030—down payment subsidies, mortgage regulation, social housing—will determine whether a generation gains access to wealth accumulation or not.
Residential Mobility in Free Fall Reveals an Economy Freezing Up
The down payment and initial costs constitute a significant barrier in the three major economies studied, jointly with prices, interest rates, and credit rules.
In 2024, slightly more than one in ten American households, or 11.2%, changed housing. This figure, 11.2%, seems trivial. It actually signifies that the American residential market, one of the country’s historical engines of social mobility, is grinding to a halt. Residential mobility measures far more than moves: it measures individuals’ capacity to seek better economic opportunities elsewhere, to leave a city where employment stagnates, to enter a first home.
This slowdown is not cyclical. Harvard JCHS documents a structural trend: the past two to three years have seen several forces converge in the same direction. Mortgage rates remain elevated. Current homeowners are “locked in” to their properties by loans contracted at rates well below market rates. And entrants face prices that have indeed corrected in certain metropolitan areas, but initial costs and down payment requirements can remain high; the nominal amount required generally declines with the property price.
The mechanism is simple to grasp. A house at $400,000 in a Sun Belt city may cost 10% less than in 2022. But the standard down payment, 20% of the price, still represents $72,000 in cash. For a graduate fresh out of university with $30,000 in student debt and a starting salary of $55,000, this amount equals several years of maximum savings, assuming they pay no rent in the meantime. Which they do, of course.
France: Down Payments Rise, the Modest Fall Behind
France presents a paradoxical picture. In 2025, the market saw a notable return of first-time homebuyers: CAFPI supported 18,007 first-time homebuyers, compared to 14,055 in 2024, an increase of 28% in one year, with these buyers now representing nearly 69% of mortgage loans granted. A sign of apparent dynamism. But behind this rebound lies a deeper fracture.
The average down payment of first-time homebuyers stands around €57,844 for a property worth €254,513, or 22.7% of the price. A considerable sum. To put this in perspective: according to INSEE and Banque de France data (2025), French people save an average of €240 per month. At this rate, gathering €57,000 in down payment requires more than twenty years of complete monthly savings, without touching anything else. The calculation says everything about who actually gains access to the market.
This strengthening of down payment requirements has accelerated recently. In the third quarter of 2025, the Credit Housing Observatory/CSA measured an increase of 33.2% in average down payment and 28.2% in the personal down payment ratio since 2019. Modest households, who represented 19.5% of homebuyers in 2019, have been particularly excluded, worsening wealth inequalities and residential mobility blockage.
The Banque de France has strictly regulated credit granting conditions since 2022. The down payment is an important element of bank evaluation, but there is no general French rule imposing its absence as automatic grounds for refusal. In other words, a permanent contract and a median salary are no longer sufficient. You must also have initial assets.
French people become first-time homeowners at an average age of 32.5 years, above the European average of 31.3 years, due in part to less widespread family financial assistance for purchases, with only one-third of young people benefiting compared to 48% in Europe. The “parental helping hand” is not a detail: it is often the necessary and sufficient condition to cross the threshold.
Germany and Europe: Three Systems, One Same Lock
Germany presents a distinct configuration. The homeownership rate was 47.2% in 2024, while 52.8% of the population rented, the lowest ownership rate and the highest share of renters across the entire European Union. This situation stems from an institutional choice rooted in German history, not a shortcoming.
It is generally recommended to mobilize 20 to 30% of the price, to which acquisition costs are added; this does not constitute a uniform banking requirement of 20 to 40%. In a RE/MAX Europe survey, 69% of German respondents aged 18 to 34 stated they rent their housing, compared to 38% of European respondents of the same age. Tenant protections and lease stability make renting a long-term solution, delaying the first purchase to 33.6 years.
Some will see this as a virtuous model, quality rental as a valid alternative to ownership. But the wealth question remains: a protected tenant in Berlin still does not accumulate real estate capital, between the fourth quarter of 2020 and the first quarter of 2026, the owner-occupied housing price index increased by 34.4% in the EU. Missing this increase on an asset you don’t own is not neutral.
The United Kingdom offers a third scenario. England has approximately 65% of homeowner households, but this figure has been declining from a peak near 71% in the early 2000s, and this decline concentrates among young people, increasingly evicted from the ladder their parents climbed. In London, even by gathering £28,200 for a 5% down payment, buying a property at £564,000 requires a loan of £535,800, which assumes household income of £119,000 at a 4.5 times income multiple. The down payment is no longer the only lock: borrowing capacity itself becomes inaccessible.
Across the continent, in the European Union, 68.5% of households lived in 2025 in housing they own, 2.2 percentage points less than in 2010 according to Eurostat, behind an average lies a mosaic: the owner rate stretches from 47.2% in Germany to 93.8% in Slovakia. Inheritances and family assistance play an important role in property access for certain households, particularly young ones, but their growing weight must be demonstrated country by country.
Student Debt and Economic Instability Freeze Household Formation
Household formation—the number of new households established each year—is one of the least publicized and most revealing indicators of a country’s social dynamism. When this figure slows, it means adults remain longer with their parents, delay coupling up, or cohabitate due to lack of means to live alone.
Student debt, liquidity constraints, unemployment, and uncertainty can delay certain residential and family transitions, but data do not permit asserting a general structural slowdown caused by these two factors alone. The causes are known, but their combination is new. American student debt exceeds $1.7 trillion according to FRED data. It reduces savings capacity and transforms risk perception: a household repaying $400 per month in student loans evaluates the risk of a 30-year mortgage differently.
Economic uncertainty—a more volatile job market, prevalence of short-term contracts in certain sectors—worsens this calculation.
This phenomenon also affects educated middle classes occupying productive jobs in metropolitan areas concentrating technology, finance, and healthcare. These cities need to stabilize these workers to maintain their economic fabric. Labor market roboticization raises an adjacent question: do productivity gains transform into real purchasing power for these workers or feed a cycle of wealth appreciation from which they remain excluded.
Macroeconomic Affordability Masks Entry Blockage
Some economists have observed since 2024 an improvement in price-to-income ratios in several American markets. According to the FHFA index for the first quarter of 2026, Austin remains approximately 12% below its 2022 peak, while Phoenix and Denver have already surpassed theirs. In a macroeconomic reading, the market would seem to be becoming “affordable” again. JCHS research shows that aggregate affordability indicators are insufficient to describe all barriers, notably the down payment.
Macroeconomic affordability measures the relationship between median price and median income. It says nothing about actual income distribution or the capacity to cross the entry threshold. A household with median income but starting from zero, without family assets, without inheritance, without parental gift, does not gain easier access to homeownership because the ratio improves. Price correction reduces future monthly payments. It can also reduce the initial down payment to gather, all else equal; this effect can, however, be offset or canceled by stricter banking criteria or increased fees.
This distinction between flows and stocks lies at the heart of the problem. Access to credit depends both on repayment capacity, down payment, and lender’s other risk criteria. And it is the stock that determines real inequality. Households already owning property accumulate value through their asset.
Their children inherit a down payment, directly or indirectly. Renter households accumulate rent paid and nothing else. Access to homeownership often contributes to wealth accumulation, but the evolution of the gap with renters varies according to cycles, leverage, and public policies.
Thus, access to skilled employment in major cities raises a practical question: if workers making these metropolitan areas function cannot afford to live there, the attractiveness of these employment basins will eventually turn against themselves.
The Fall in Immigration Amplifies Demand Contraction
JCHS projects that net international migration will fall in 2026 to approximately one-third of its 2001-2019 average. This figure deserves examination.
Immigration has historically fueled housing demand in the United States at two levels. First, immigrant households have a higher household formation rate: they establish homes quickly after arrival. Second, they massively occupy the rental segment, liberating through chain effect part of the inventory accessible to native first-time buyers. The projected decline in net international migration should slow housing demand growth, particularly rental demand.
Effects are already visible in certain markets. Cities banking on sustained demographic growth to absorb their new rental stock find themselves with rising vacancy rates. This reversal weighs on short-term prices, which some read as improved affordability, but it masks a weakening of long-term dynamics. A city that does not renew its working population is undermining its potential for economic growth.
The historical American lesson is clear: great phases of social mobility in the 1950s-1970s relied on a conjunction of sustained demographics, accessible credit, and rapidly expanding residential stock. All three pillars of this mechanism are today fragile.
2026-2030 Policies Can Still Modify the Trajectory
The stakes of the coming decade are not abstract. If current mechanisms persist, many households formed in the 2020s could reach their forties without real estate assets, in a country where homeownership constitutes an important vector of long-term wealth accumulation for many households. This bifurcation is not inevitable. It results from institutional choices that can be made differently.
Several levers exist, at different stages of maturity. The first concerns the initial down payment itself. Down payment assistance programs—direct subsidies, interest-free loans, dedicated tax-advantaged savings accounts—exist in several states. Their scope remains modest compared to the extent of the blockage. Significant scaling would require federal or state political commitment well beyond what has been done.
Oregon, Georgia, and Maryland have experimented with mechanisms targeting first-time buyers at median incomes. Results are encouraging at small scale, insufficient to change mass dynamics.
In France, the support architecture is denser. The Zero-Rate Loan has been extended since April 2025 to the entire territory, including new single-family homes, and its income ceilings should be revalued by 8 to 13% as part of the 2026 Budget Bill. More than 45,000 zero-rate loans were granted in 2025, a volume nearly equaling that of the entire previous year. But these devices remain targeted at modest households: the educated middle classes populating tight markets—Paris, Lyon, Bordeaux—are often excluded by income ceilings, precisely where the necessary down payment is highest.
The second lever is regulatory: mortgage standards. The requirement of a 20% down payment is a convention, not a law of physics. Reduced down payment loans exist; FHA loans allow going down to 3.5%, but they come with mandatory mortgage insurance that increases monthly payments and reduces attractiveness for borrowers. Hybrid formulas, combining public guarantees and private loans, would allow maintaining prudential caution while lowering the effective entry threshold.
The third lever is supply. JCHS notes a particularly weak construction response in San Francisco and Boston over 2007-2017, while New York displayed conversely robust construction relative to household growth. JCHS more generally emphasizes that restrictive zoning can hinder construction. Exclusive zoning reform, which prohibits multifamily housing construction across large swaths of urban areas, is one of the rare subjects achieving consensus between left and right-wing economists. The state of Montana, New Zealand, and to a certain extent Minnesota have undertaken ambitious reforms.
Effects on prices begin appearing over five to ten-year horizons, meaning decisions made now will have tangible effects by 2030-2035.
If Nothing Changes, Homeownership Becomes a Hereditary Advantage
Two trajectories are emerging for the coming decade, depending on whether these levers are activated or not. In the status quo trajectory, the market would continue functioning as today: homeownership access would often remain linked to preexisting family wealth or higher incomes. Ownership rates among under-35s, already declining for twenty years according to the US Census, would continue falling. The wealth gap between owners and renters would widen each decade. Social mobility would be increasingly predicted by parental wealth rather than work income.
In the alternative trajectory, which assumes policy decisions in the next five years, several conditions must be met simultaneously. Sufficient housing supply in areas where employment concentrates. Down payment assistance mechanisms not limited to the lowest incomes but reaching educated middle classes. Mortgage regulation lowering the entry threshold without recreating the financial instability conditions of 2008. Each of these three conditions is individually politically difficult.
Their combination is even more so. But they are not beyond reach: several comparable countries—Canada, Australia, the Netherlands—have developed hybrid instruments meriting serious study.
What would distinguish the two trajectories by 2027-2028: the evolution of first-time homebuyer rates among 25-35 year-olds, the progression or decline of down payment assistance programs in the most populous states, and zoning reform votes in major agglomerations. These signals are readable long before their effects fully materialize. They will tell whether a generation is being permanently excluded from wealth accumulation or whether American institutions have chosen to keep the social elevator in working order.
The 2026 Harvard JCHS report transcends housing alone: an economy barely maintains intergenerational mobility when access to real estate ownership, an important wealth vector for many households, remains difficult for entrants. Access to education preparing for mobility is part of available levers. Wealth gaps and unequal capacity to finance a down payment constitute an important obstacle to economic mobility, without entirely summing up all social mobility.
Sources
- Harvard Joint Center for Housing Studies, State of the Nation’s Housing 2026, https://www.jchs.harvard.edu/press-releases/high-costs-and-slumping-demand-squeeze-housing-affordable-units-remain-short-supply
- Compass Intelligence, Housing Market Outlook 2026 (no link: proprietary report)
- US Census Bureau, Homeownership Rates by Age Cohort, https://www.census.gov/housing/hvs/index.html
- Federal Reserve Bank of St. Louis (FRED), Student Loan Debt, https://fred.stlouisfed.org
- CAFPI, Accession à la propriété 2025 : retour des primo-accédants, https://www.cafpi.fr/credit-immobilier/actualites/accession-propriete-2025-retour-des-primo-accedants
- Observatoire Crédit Logement/CSA, cited in Journal de l’Agence, Primo-accession à la propriété : une chute historique, https://www.journaldelagence.com/1407915-primo-accession-a-la-propriete-une-chute-historique-qui-fragilise-tout-le-marche-immobilier
- RE/MAX, European Housing Trend Report 2025, cited by Euronews Business, https://www.euronews.com/business/2026/06/16/whats-the-average-age-of-first-time-homebuyers-across-europe
- Eurostat, Owner-Occupied Housing Price Index Q1 2026, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Housing_price_statistics_-_owner-occupied_housing_price_index
- Investropa, Why don’t Germans buy property?, https://investropa.com/blogs/news/germany-germans-dont-buy-property
- FinanceMate, Germany vs UK: The Property Ladder Meets the Renting Culture, https://financemate.de/real-estate/markets/germany-vs-uk
