(March 11, 2025) – A new report released today from ServiceLink, the nation’s premier provider of tech-enabled mortgage services, revealed that Gen Z remains eager and ready to buy a home this year. But high interest rates and home prices could deter them from crossing the finish line as their tolerance is waning. The annual survey analyzes generational trends among recent and prospective homebuyers, revealing their sentiment about the current housing market and their intentions to purchase, refinance or leverage home equity this year. 

Now in its fifth year, the 2025 ServiceLink State of Homebuying Report (SOHBR) features insights from homeowners who either purchased a home or tried to purchase a home within the past four years and focuses on yearly trends that provide valuable insights for lenders, servicers, investors and real estate agents alike. This year, buyers and would-be buyers showed a growing interest in technology, adding more space to their home and a desire for even greater transparency. 

“These findings show that there is still a strong appetite for homeownership, particularly among the youngest generation, despite the ups and downs of today’s market,” said Dave Steinmetz, president, origination services. “Today’s buyers need to be armed with information, while demonstrating patience and flexibility, in order to achieve their dream of homeownership. For lenders, this provides an opportunity to tap into technology and increase offerings that buyers indicate they want to see. Lenders also should focus on education and increasing transparency to meet the current needs of today’s buyers.”

Key findings of the report include:

Gen Z remains ready to buy a home, but also willing to walk away

• 67% of Gen Z respondents said they plan to purchase a home this year compared to 51% of millennials, 49% of Gen X and 22% of baby boomers.
• Overall, 47% of those surveyed said they plan to consider purchasing a home in 2025.
• High home prices and interest rates could hold buyers back from going through with a purchase. 43% of respondents said they considered buying a home in 2024 but decided against it for those reasons.
• Gen Z led all respondents in their decision to walk away from the process, as 58% said they abandoned the homebuying process in 2024 and 38% said they were unsuccessful in their attempt to purchase in the last four years. 

A favorable outlook, but tolerance for high interest rates is waning

• 41% of all respondents said that they believe conditions are favorable for buying a home this year. Gen Z led the way with 52% having a favorable outlook on the market, while only 23% of baby boomers felt the same. 
• 69% of all respondents said they are happy with their current mortgage rate.
• For those interested in purchasing this year, their tolerance for high rates is waning. Gen Z respondents indicated that they have an average 5.1% mortgage rate yet would consider going as high as 5.8%. That number is down from a year ago, when Gen Z respondents were willing to go as high as 6.3%.
• Millennials also are pulling back their tolerance this year, with the highest rate they would consider set at 5.5%, down from 6.2% in 2024.

Millennials are slowly stepping back, while Gen X is making a return

• Millennials, who just two years ago were the most eager among all generations to purchase a home, are slowly pulling back their desire. 51% of millennials still plan to buy in 2025, down from 59% last year and 61% two years ago.
• Only 46% of millennials said conditions are favorable to buy in 2025, down from 60% in 2023.
• Gen X, on the other hand, is showing a renewed interest in buying a home in 2025. This year, 49% of Gen X respondents said they plan to buy, up from 45% in 2024, 25% in 2023 and 12% in 2022.
• Gen X also is the most influenced by technology, with 82% saying they would be more likely to work with a lender that offers appraisal or closing appointment scheduling from a phone or tablet that allows them to select the exact date and time they desire. Additionally, 77% of Gen X respondents said they would select a lender who offered virtual closings.

Buyers know what they want: Space

• 60% of respondents who plan to purchase a home in the next year said they’re looking for a home with more space, a 17% surge from a year ago, while 39% of respondents said they would like to see more room between homes.
• 51% of respondents said the biggest deal breaker in buying a home would be that the size of the home is too small. Other top deal breakers include higher taxes (48%), lack of privacy/homes too close together (43%) and lack of outdoor space (33%).
• Gen Z leads all generations in their desire for a larger home with more space at 66%, followed closely by millennials at 64%.

Lenders take note: Technology benefits are widespread 

• 59% of respondents said the biggest benefits of mortgage technology offerings is the convenience and ease of use it provides, while 51% said they like that it saves them time and 45% enjoy the flexibility that it offers to make progress on their own schedule.
• eSigning technology continues to surge with 62% of all respondents who purchased a home in the last four years saying they utilized digital document signing, up from 48% who said they did the same two years ago.
• Baby boomers leveraged eSigning the most at 70% compared to 42% of Gen Z respondents.
• 35% of all survey respondents who purchased a home in the last four years said they scheduled their appraisal or closing digitally, with millennials leading the way at 39%.

Equity is growing, so is the desire to refinance 

• 39% of all respondents said they have at least $100,000 in home equity, up from 34% in 2023.
• One in four respondents said they plan to take out a home equity loan this year, down slightly from 28% in 2024. 10% of respondents said they don’t know enough about home equity loans to consider them.
• Many respondents have hope that mortgage rates might drop this year, allowing buyers to secure a better rate. 60% of respondents said they are either “likely” or “somewhat likely” to refinance this year in an attempt to get a better rate. That is up slightly from 57% in 2024.

Read the full report here. 

Methodology 

ServiceLink partnered with Sago to complete an online survey of potential respondents who purchased a home, or tried to purchase a home, in the past four years. A total of 1,526 respondents completed the survey. The respondents were made up of equal parts male and female, as well as equal distribution between all four homebuying generations. Interviewing was conducted by Sago from November 18, 2024, to December 5, 2024.