Study: 85% of Young People Want Their Own Home, but Can't Afford to Buy One

84% of Estonian young people aged 18–30 consider home ownership an important life goal, while at the same time 85% believe that their generation would like to buy their own home but do not find it realistic, according to a study conducted by housing developer Bonava in cooperation with Norstat.

According to Bonava Estonia's CEO Taavi Soorm, the study shows that although younger generations are often attributed greater willingness to rent and remain flexible in their lives, the desire of Estonian young people to own their own home remains strong.

„Considering the younger generation's lifestyle and work and study opportunities, one might have expected that freedom, mobility and flexibility have become more important than home ownership. However, the study showed the opposite – Estonian young people believe in real estate. However, it has become more difficult to reach the first home," Soorm shared the results of the study conducted among young people.

Home ownership as a life goal

Of the study participants, 84% consider home ownership an important life goal for them, and 88% believe that owning their own home provides greater security than a rental home. For the young people who participated in the study, home purchase was most often associated with security and stability, but also with freedom, a sense of achievement and adulthood.

At the same time, 42% of young people who participated in the study feel societal pressure to buy a home, which shows that home ownership is associated not only with personal desire but also with societal expectations.

„Home purchase is one of the biggest financial decisions for most people. Therefore, it should be based primarily on a person's own needs and possibilities, not on the feeling that the measure of a successful and independent adult is necessarily property ownership," said Soorm.

The desire to own a home collides with financial possibilities

The desire to own a home and the ability to buy it do not go hand in hand for many young people. 85% of study participants believe that young people would like to buy a home but do not find it realistic. 86% of respondents felt that their generation finds it harder to buy a home than previous generations.

Young people who participated in the study cited high real estate prices, the difficulty of accumulating a down payment, and insufficient income as the main obstacles to home purchase. In contrast, only a small proportion of respondents consider the desire to maintain a flexible lifestyle as an obstacle to home purchase.

According to Soorm, improving housing accessibility is not the task of just one party. „A developer can make better designs and seek a more reasonable balance between price and design, but housing accessibility is also affected by other factors – for example, established requirements, detailed planning processes and loan conditions. All these factors ultimately affect what the price of a home will be," Soorm explained.

The results of the study suggest that young people's desire to own their own home has not disappeared, but reaching it takes more time. Bonava also sees the same change in its own customer profile.

„Bonava's customer statistics confirm that home purchases are shifting to an increasingly later age. While three years ago the average age of Bonava's customers was 34 years, it has now risen to 39 years. The share of customers under 30 has fallen from 35% to 28%, while those aged 39–48 now make up nearly a third of customers," said Soorm.

According to the housing developer, the changed purchasing profile of young people means that the market must have homes at different price levels and solutions to provide options for buyers with smaller budgets.

„A person's first home does not necessarily have to be a large apartment in a new development. Certainly, one option is also to consider areas near the city, where the price per square meter may be lower and you get more for the same budget. For example, we see many young families among the buyers of our Saku Kirsiõue development," said Soorm.

According to the housing developer, improved planning can also contribute to making homes more affordable.

„Well-designed planning allows you to provide good functionality even with a smaller area, so that every square meter is truly usable. It is important that the existing space meets the person's needs and is thoroughly thought through," added Soorm.