1 in 3 Millennials and Gen Zers believe they could become homeless

America’s housing affordability is so bad that many younger Americans believe they could actually end up on the streets.

According to Acorns’ 2024 Money Matters Report, one in three Millennials and Gen Z respondents said they are anxious about becoming homeless.

Compared to Baby Boomers, Millennials and Gen Zers are nearly three times more likely to worry about being unable to afford rent.

Acorns, which provides micro-investing services, said “financial insecurity” is to blame for the anxiety around homelessness.

A high cost of living, stubborn inflation, mounting consumer debt, and stagnant wages were the biggest pain points cited in the report.

The study found that only 35% of Americans are confident they’ll be more financially secure next year.

Although financial insecurity is common across America, it hits hardest in major cities where rents and living costs are through the roof.

This aligns with a recent Creditnews Research report, which found that the most unaffordable metros for renters are major urban centers in California, the Northeast, and Florida.

Different reports, but both tell the same story: Housing insecurity is becoming a major problem.

More Americans struggle to afford rent

Housing affordability has always been a hot-button issue, but it's become even more sensitive after the pandemic.

According to Zillow, the average rent hit just under $2,000 in April, meaning tenants need to earn 36% more than they did in 2019 to afford a typical rental unit.

Over that period, rents have grown 1.5 times faster than wages.

Perhaps not surprisingly, last year, a record 650,000 Americans found themselves on the streets, marking a 12% uptick in homelessness.

The biggest causes are “the shortage of affordable homes and the high cost of housing that have left many Americans living paycheck to paycheck,” said Jeff Olivet, executive director at the U.S. Interagency Council on Homelessness.

To address the issue, economists from leading universities are pressuring Biden to implement rent controls—a controversial plan to cap rent payments.

Although President Biden has introduced a 10% cap on rent hikes, it will only apply to certain affordable housing units that are already subsidized by the government.

Industry insiders aren’t so sure it’ll have the desired effect—and some even think it will only make affordability worse.

“Rent control has consistently proven to be a failed policy that discourages new construction, distorts market pricing, and leads to a degradation of the quality of rental housing," said Bob Broeksmit, president and CEO of the Mortgage Bankers Association.