The generational housing lockout is widening the wealth gap — but a coming wave of inheritance could reset the market

Many younger Americans spend up to 50% of their income on housing costs, far exceeding the traditional 28% guideline. Spending so much on housing leaves less room to save for a down payment or qualify for a mortgage. The longer young buyers delay homeownership, the harder it is to build equity over time.

Americans ages 70 and older now control more than $12.5 trillion in real estate wealth. The share of real estate wealth held by Americans ages 40 to 54 has declined or remained flat. The median age of a first-time homebuyer is now about 40, more than a decade older than in the 1970s.

Younger generations face rising home prices, higher mortgage rates and mounting debt, including student loans, credit cards and car loans. Baby Boomers have surpassed middle-aged Americans in total real estate holdings for the first time on record.

About 48 million Baby Boomers are expected to pass away over the next 20 years. Up to 80% of Baby Boomers own real estate and 15% own multiple properties. A slow drip of real estate will enter the market as older homeowners pass down assets. Increasing inventory from the "Great Wealth Transfer" could ease pressure on home prices over the next two decades. Younger buyers who have long been priced out may gain new opportunities to enter the housing market.