Stuck between renting and owning? 4 tips to make the most of where you are
If you're in your late 20s or early 30s and feel like homeownership keeps slipping further out of reach, you're not imagining it — and you're far from alone. According to recent research from Apartment List, the homeownership rate for adults ages 25-34 has dropped to just 30% nationwide, approaching the lowest point on record and reversing gradual gains made between 2017 and 2022. Homeownership rates have fallen across all age groups, but young adults in what have historically been the prime years for first-time homebuying have seen the biggest decline.
The culprit is a compounding affordability crisis that's been building since 2020. First, pandemic-driven demand sent home sale prices skyrocketing. Then rising interest rates in 2022 stalled price growth but made monthly mortgage payments even more painful. Since then, insurance premiums, utilities, and other ownership costs have continued climbing. Today, new homeowners spend more than $1,000 a month more on housing than renters do — and in some markets, they're paying twice as much.
The result is a generation increasingly stuck in the middle. Half of young adults now rent, with that rate approaching an all-time high. But renting has gotten harder, too: Inflation-adjusted median rent for recent movers has risen about 30% since 2010. Caught between unaffordable ownership and increasingly expensive renting, more than 9 million young adults have landed on a third path — living in someone else's owned home. Most commonly, that means living with parents or grandparents. That group has hit an all-time high of 6.3 million, and it's still growing.
The for-sale market is showing early signs of softening — home price growth has slowed from 6% in 2024 to about 1% today, and prices are actually declining in high-construction cities like Dallas, Phoenix, and Denver — but not enough to close the gap for most young adults. Labor market uncertainty is making it harder to grow wages fast enough to catch up. None of this means you're without options. It just means the decisions you make now matter.
Here are five practical ways to make your current situation work for you:
1. Reframe where you are as a financial position, not a setback
The social stigma around renting long-term or living at home can make it feel like failure, but treating your current living situation as temporary and shameful leads to passive decision-making. Treating it as a strategic position — one with real financial upside, if managed well — leads to very different outcomes.
If you're living at home, you have a rare opportunity to save money at a pace that simply isn't possible for most renters. Be deliberate about it. Set a specific savings goal (a down payment target in a realistic market for you), automate monthly savings or investing, and track your progress.
2. Calculate the true cost of renting before you sign
The advertised rent on a listing is rarely what you'll actually pay. Before committing to a lease, add up the total cost, including monthly rent plus utilities, parking, pet fees if applicable, and the upfront costs of first month, last month, and a security deposit. That total is your real number, and it should stay under 30% of your gross monthly income to leave room for saving and other financial goals.
While you're at it, don't skip renter's insurance. It's one of the most underused protections available to renters. Many people assume their landlord's policy covers their belongings, but it doesn't. A policy typically costs $15-$30 a month and can cover theft, fire, water damage to your belongings, and temporary relocation costs if your unit becomes uninhabitable. It's a small line item that can prevent a genuinely devastating financial hit.
3. Take geography seriously
Where you live is one of the most impactful variables in your housing equation. In Los Angeles, only about 10% of adults ages 25-34 own homes. San Francisco and San Jose hover around 14%, and San Diego sits at 15%. These aren't just expensive cities; they're places where even high earners can be priced out of home ownership.
Contrast that with cities like Grand Rapids (39%), St. Louis and Minneapolis (38%), and Kansas City (37%), where homeownership rates for the same age group are dramatically higher — not because residents are wealthier, but because housing is more accessible. If you have any flexibility in where you live, or if remote work is a real option, consider running the numbers on lower-cost markets.
4. Build your credit like your next lease depends on it, because it does
Most renters don't realize that landlords pull credit just like lenders do. A strong credit score doesn't just help you qualify for an apartment, it gives you leverage to negotiate better lease terms, skip extra deposits, and get approved in competitive markets where multiple applicants are vying for the same unit. In a rental market this tight, your credit profile can be the difference between getting the place you want and settling for something else.
Check your credit report and address any errors. Keep credit card balances below 30% of your limit, pay on time every month without exception, and avoid opening new accounts you don't need. If your credit history is thin, a secured credit card or credit-builder loan can help establish it. These aren't dramatic moves, but compounded over a few years, they can meaningfully expand your lending and leasing options.
This story was produced by Apartment List and reviewed and distributed by Stacker.
