And younger generations are so disappointed and frustrated by the state of the housing market they are spending more of their earnings than they are saving, they’re working less, and they’re making risky investments, according to a paper by Northwestern University and University of Chicago researchers. 

In other words, younger generations are “giving up.” That’s according to Northwestern’s Seung Hyeong Lee and Chicago’s Younggeun Yoo, who also cited a 2024 Harris Poll survey about the state of real estate that showed 42% of Americans and 46% of Gen Z respondents agreed with this statement: “No matter how hard I work, I will never be able to afford a home I really love.”

While households typically adjust consumption to stay on track with long-term goals like buying a home, younger people are crossing a “threshold at which they begin to give up on [buying a home] entirely.”

The idea that this generation is “giving up” is also echoed in an analysis by Gen Z’s favorite economist, Kyla Scanlon, who argues younger people face a sense of “financial nihilism,” a phenomenon in which they question the American Dream amid stagnant wages, student loan debt, and corporate dominance. 

Gen Z has “watched the American Dream rot before their eyes, as higher education becomes a luxury good, a housing crisis exacerbates the cost of living, all backdropped by political stagnation and rapid (perhaps even too rapid) technological advancement,” she wrote, making the point this generation has lived through not one, or two, but three major economic downturns. 

Gen Z doomspending and financial nihilism

The first phenomenon Lee and Yoo outline regarding Gen Z’s withdrawal from buying a home is that they’re spending more money than they’re saving. 

“We find that when home prices rise to the point where renters can no longer afford to buy a house within the foreseeable future by saving their wages, renters give up on home purchases and instead use their savings to increase consumption,” they wrote. 

Several other studies this year have shown Gen Z is doomspending rather than saving, with one study showing nearly half don’t even have an emergency fund saved up. A Bankrate survey also showed as many as 27% of Gen Z carry more debt than they do savings.

“Many Gen Zers find themselves walking a financial tightrope, torn between covering immediate expenses or setting money aside for emergencies and paying for goods on credit instead,” Aleksandra Medina, cofounder of finance app Frich, previously told Fortune.

Some of that may be owing to the fact Gen Z expects to inherit money and assets from the $124 trillion Great Wealth Transfer, but a Northwestern Mutual survey shows very few can expect a windfall of cash upon a relative’s death.

Gen Z doesn’t think it’s worth working hard to save up

We’ve all heard Gen Z supposedly doesn’t work as hard as other generations, which may or may not be true—it’s somewhat impossible to measure. Lee and Yoo found in their research Gen Z has cut down on their effort at work because they don’t think it’s worth it if they can’t afford long-term financial goals. They cite answers to psychographic questions about the importance of “always giving my best effort” at work. Their research shows the share of renters reporting low work effort is nearly twice the rate observed among homeowners.

“This shift is consistent with a reallocation of time and effort by discouraged renters,” the researchers wrote. “As the perceived returns to labor (in terms of progressing toward homeownership) diminish, so does the value they place on maintaining high work effort.”

Scanlon has a different take on Gen Z’s work effort, though. 

She argues: “Maybe it’s not that they don’t want to do anything anymore, but rather they don’t want to do anything in the way that it’s always been done anymore.” 

Gen Z is making risky investments

The third way Gen Z is responding to their inability to buy a home, the researchers argue, is by taking on risky investments, like buying cryptocurrencies. Their research also shows when buying a home for a Gen Zer seems unaffordable, they also increase their leisure spending.

“Renters with a plausible path to homeownership may exhibit lower risk tolerance, as significant losses could derail their progress toward that goal,” they wrote. “In contrast, those who have already given up on homeownership may perceive they have less to lose, and therefore engage more willingly in risky financial behavior.”

Other 2025 research indicates Gen Z is far more likely to own crypto than have a retirement account, illustrating how they’re more willing to take on riskier investments. And finance experts are worried about the pattern, they told Fortune’s Emma Burleigh.

“It’s never a bad thing for people in any generation to take interest in their personal finances,” Mark Smrecek, financial well-being market leader at Willis Towers Watson (WTW), told Fortune’s Burleigh. “I think as long as they’re looking at risk and reward based on what their goals are, it’s generally fine. But I do get concerned when I see over-indexing toward risky assets.”

A version of this story was originally published on Fortune.com on December 12, 2025.

More on Gen Z:

• Gen Z graduates who majored in ‘AI-proof’ careers like pharmacy, biology, and education are making less than $50,000 after graduation
• Gen Z women are the new face of unemployment—and it’s not because they’re too choosy: Low grades and bad health are to blame for these NEETs, new research warns
• Gen Z is already nostalgic for TikTok—and the platform is only 6 years old