Redefining Real Estate in the Post-Affordability Era: Gen Z, Intergenerational Wealth, and Strategic Shifts

The U.S. housing market is undergoing a seismic transformation, driven by the delayed entry of Gen Z into homeownership and the accelerating pace of intergenerational wealth transfers. As first-time buyers now average 40 years of age-historic highs-the traditional pathways to homeownership are being rewritten. This shift, compounded by high mortgage rates and rising costs, has forced younger generations to rely on family support and inherited assets to navigate an increasingly unaffordable landscape. Meanwhile, real estate investment strategies are evolving to reflect these dynamics, with figures like Ryan Serhant offering bold insights into how wealth is being preserved, transferred, and leveraged in a post-affordability era.

The Aging First-Time Buyer and the Role of Intergenerational Wealth

The median age of first-time homebuyers has surged to 40 in 2025, a stark departure from previous decades according to the National Association of Realtors. This delay is not merely a demographic quirk but a symptom of systemic affordability challenges. High mortgage rates and inflated housing prices have made entry into the market prohibitively expensive for many Gen Zers and younger millennials. According to the National Association of Realtors, intergenerational wealth transfers are now a critical lifeline for younger buyers, with inheritances and parental gifts enabling purchases in both starter homes and luxury properties. For instance, Generation X-set to inherit $30 trillion from Baby Boomers-is emerging as the fastest-growing segment of luxury homebuyers. This trend underscores a broader $84 trillion wealth shift from older to younger generations, with real estate serving as a central asset class in these transfers.

Women, in particular, are reshaping the market, now outnumbering single men in luxury home purchases by 12%. This reflects not only changing gender dynamics but also the strategic use of inherited wealth to secure independence and long-term security. For Gen Z, the expectation of receiving assets like real estate, art, or cash trusts is reshaping financial planning. Yet, as data from BMO reveals, 64% of Gen Z buyers are factoring in future refinancing as a key part of their strategy, a gamble on lower interest rates to reduce mortgage burdens.

Ryan Serhant's Vision: Portfolios of Cities and the "Nobody's Market"

Ryan Serhant, a leading voice in real estate innovation, has framed the current market as a "nobody's market", where neither buyers nor sellers hold the upper hand due to high interest rates and stagnant inventory. This stalemate has prompted a radical rethinking of how wealth is deployed in real estate. Serhant highlights a seismic shift among the affluent: instead of settling for a single home, they are adopting a "portfolio of cities" approach, owning properties in multiple locations to diversify lifestyle and investment risks. This strategy mirrors stock portfolio diversification, with hybrid work arrangements, tax optimization, and lifestyle flexibility driving demand for secondary homes in markets like New Hampshire, Rhode Island, and Las Vegas.

Serhant also emphasizes the compounding power of homeownership in building intergenerational wealth. He notes that children whose parents own homes are three times more likely to become homeowners themselves, a statistic that underscores the enduring role of real estate in wealth transfer. However, he warns that the American Dream is increasingly out of reach for Gen Z, with starter homes in major cities now exceeding $1 million in some cases. For younger buyers, this has led to a pivot toward non-traditional markets, such as Pittsburgh and St. Louis, where affordability and growth potential align with their financial realities.

Strategic Tactics for Investors: Navigating the New Normal

For investors, the post-affordability era demands a recalibration of traditional real estate tactics. Serhant's insights point to three key strategies:

1. Diversified Geographic Portfolios: Investors should prioritize markets where intergenerational wealth transfers are most active. Luxury markets like New York City-where Serhant's firm closed over $1 billion in sales within 35 days of 2025-remain resilient despite broader economic uncertainties. Simultaneously, secondary markets with lower costs and strong growth potential (e.g., Sun Belt cities) offer opportunities for first-time buyers reliant on inherited capital according to market analysis.

2. Leveraging Technology and Alternative Assets: The integration of digital tools-virtual tours, AI-driven valuations, and blockchain-based transactions-is streamlining real estate transactions, particularly for Gen Z buyers who prioritize efficiency according to industry reports. Additionally, Serhant's early investments in Bitcoin-made at $3,000 and $16,000-highlight the growing intersection of cryptocurrency and real estate, with digital assets poised to play a larger role in transactions and wealth management.

3. Anticipating Market Catalysts: Serhant predicts that lower interest rates in 2026 could trigger a surge in inventory, not from traditional market forces but from an unexpected source: rising divorce rates. As affordability improves, individuals may opt to leave shared living arrangements and purchase homes independently. Investors should prepare for this influx by positioning themselves in markets with high demand for starter homes and short-term rentals.

The Long-Term Outlook: Wealth Transfer and Market Resilience

While the Great Wealth Transfer promises to boost demand for housing, it also risks exacerbating inequality. Only 20% of Baby Boomers plan to leave inheritances, with many choosing to spend their wealth during their lifetimes. For those who do inherit assets, real estate remains a preferred vehicle for wealth preservation, but the benefits are skewed toward the already affluent. This dynamic raises questions about the sustainability of a market increasingly reliant on inherited capital.

For Gen Z, the path to homeownership is no longer linear. Many are embracing renting as a long-term lifestyle choice rather than a temporary step, a shift that could reshape urban planning and housing supply. Investors must balance short-term gains with long-term adaptability, recognizing that the next generation's priorities-sustainability, walkability, and mixed-use developments-will redefine what constitutes a desirable property according to market experts.

Conclusion

The post-affordability era is redefining real estate investment strategies, with intergenerational wealth transfers and Gen Z's delayed homeownership at the forefront. As Serhant's insights illustrate, success in this new landscape requires agility, a willingness to embrace alternative assets, and a deep understanding of how wealth is being passed down and deployed. For investors, the challenge-and opportunity-lies in aligning with these shifts while navigating the uncertainties of a market where neither buyers nor sellers hold the upper hand.