The share of young adults who own homes has fallen 11 percentage points over the past two decades, roughly double the decline shown by traditional metrics, according to a new analysis published May 28, 2026, by researchers at the Urban Institute. The gap exists because standard homeownership statistics ignore the millions of 25- to 34-year-olds who never formed their own households in the first place, instead living with parents or roommates.

The conventional homeownership rate for household heads ages 25 to 34 dropped from 47 percent in 2005 to 37 percent in 2015, then partially recovered to 40 percent by 2024. But when researchers counted all young adults—not just those heading independent households—the real homeownership rate fell from 40 percent in 2005 to just 29 percent in 2024. The share of young adults living with their parents nearly doubled during this period, jumping from 12 percent in 2005 to 21 percent in 2015 and remaining at 20 percent in 2024. Meanwhile, those living with roommates, significant others, or other family members rose from 14 percent to 19 percent between 2005 and 2015, sitting at 18 percent in 2024. The 2019–22 period saw slight improvements in household formation and homeownership tied to historically low interest rates, but both trends reversed between 2022 and 2024 as rates climbed.

Marriage rates among young adults also declined sharply, falling from 53 percent in 2005 to 38 percent in 2024. Among married young adults specifically, the homeowner share dropped from 61 percent in 2005 to 49 percent in 2015 but rebounded to 56 percent by 2024—a stronger recovery than aggregate figures show. Never-married and previously married young adults followed similar patterns with more modest recoveries. All marital groups were less likely to form independent households in 2024 than in 2005, with never-married individuals least likely to do so.

The report finds that roughly half the decline in real homeownership is attributable to reduced household formation itself. If the share of young adults forming independent households had stayed at 75 percent instead of falling to 63 percent, the 2024 homeownership rate would have been 34 percent rather than 29 percent. The authors explain that standard homeownership metrics create two distortions: owner-occupied households tend to be larger, which pushes household-based rates down, but more importantly, excluding people who haven't formed independent households pushes rates upward because these individuals aren't counted in the denominator. The reversal in household formation and homeownership between 2022 and 2024, the researchers note, highlights how sensitive young adults are to rising costs and interest rates.

The report concludes that improving young adult homeownership requires going beyond mortgage access to address broader constraints on household formation. The authors recommend expanding the supply of entry-level housing, lowering barriers to new construction, and supporting pathways into independent living to make housing more affordable. They also suggest housing policy and mortgage systems may need to better reflect the realities of single and nontraditional households, such as creating smaller, less expensive units or expanding cobuying programs for friends or extended families. The bottom line: official homeownership statistics are masking a crisis twice as severe as they appear, and solutions need to tackle not just who can buy, but who can even afford to live on their own.