‘This Old House’ just took a look at the American Dream of homeownership, and sees ‘evident desperation’ among home buyers

2023 was especially scarring for aspiring first-time homebuyers. Decades-high mortgage rates, rising home prices, and low inventory levels locked out many of them from achieving the American Dream. In fact, many aspiring homeowners have completely given up on the idea of ever owning a home, a new study shows.

A study from the online arm of long-running home improvement TV show This Old House, published Monday, shows that half of the aspiring homeowners who have let go of their homeownership dream say it’s because they’ll never be able to afford it. The research team for the TV show, which debuted in 1979 and largely launched the home improvement genre, surveyed 3,000 aspiring homeowners about whether they believe homeownership is within reach and what their biggest barriers are. Of aspiring homeowners surveyed, 85% still want to pursue buying a house this year.

But it’s no wonder that 15% of people who previously wanted to buy a house have completely given up. Goldman Sachs in October 2023 reported that housing affordability is even worse now than it was during the disastrous crash of 2008, and Redfin reported that Americans need to make nearly $115,000 to buy a house, which is $40,000 more than the median household income in the U.S.

Indeed, This Old House found that one in five aspiring homeowners failed to purchase in 2023, with affordability being the chief complaint.

“Among these aspiring buyers, a significant portion cited difficulties in affording down payments and concerns about mortgage rates as barriers to purchasing a home,” Taelor Candiloro, a researcher on This Old House’s reviews team, tells Fortune. “High mortgage rates can certainly influence a buyer’s perception, but there is evident desperation in our survey as 30% would settle for a mortgage rate higher than 6% if it meant finally purchasing a home.”

The top factors preventing them from purchasing a home in 2023 included home prices, mortgage rates, moving costs, down payment costs, credit scores, debt, and inventory levels. Indeed, mortgage rates peaked at 8% in October 2023 and there was a lack of supply for potential buyers, so “2023 was a wash for many who hoped to buy a home,” according to the study.

Willing to concede

Although 20% of aspiring homeowners couldn’t make a purchase based on the factors mentioned above, 72% percent of unsuccessful buyers still have plans to purchase a home in 2024. But many of them are willing to concede to make homeownership happen.

Other aspiring homeowners are willing to increase their budget to buy a home this year, settle for a different area from where they had originally planned, ease up on square footage expectations, and ask family members for money to buy a home. Some are also willing to offer above the original asking price.

Beyond the study, millennials and Gen Zers have already shown creativity in trying to avoid a home. In fact, housing affordability is so strained that two in five Gen Zers and millennials are working side hustles to save for down payments, according to a Redfin study released in September 2023.

Some people “simply don’t have the money for a down payment—a situation that has become increasingly common due to rising mortgage rates and elevated home prices,” Redfin deputy chief economist Taylor Marr said in a statement.

Plus, one in five millennials have also started asking for money to buy a home on their wedding registries, according to an October 2023 report by Zillow and The Knot, a wedding planning site. With an average of $70,000 needed for a 20% down payment on a starter home, it’s understandable that couples would need extra ways to get cash.

“Most of the first-time homebuyers I am working with are faced with challenges of affordability and competition,” Donna Incorvaja, a real estate agent at RelatedISG Realty, previously told Fortune. “It’s not that they can’t afford to buy, but that what they can afford in today’s market is very different from what a younger generation could buy three to four years ago.”

Sense of optimism

Although many homebuyers have given up on the idea of owning a home completely, others are still holding out. Of aspiring homeowners who still want to buy a house even though they failed last year, some believe the home prices will decrease (despite several forecasts indicating otherwise) and that inventory levels will improve, which is also a large unknown in today’s housing market.

Even with a certain level of optimism, 76% of prospective homeowners plan to use programs to help lower their down payment, but may not have a mortgage secured, according to the study. In fact, only 42% of potential 2024 homebuyers are preapproved for a mortgage, which is typically the first step in starting the home hunting process.

Others are also holding out for how the 2024 presidential election may impact the economy—and therefore the housing market.

“Real estate tax rates, deductions, and overall policies like increasing housing inventory may be affected as a new president steps in,” Candiloro says. “We found that 13% of aspiring homeowners are currently waiting to see how the 2024 election will impact our economy before making any decisions on purchasing a home.”

Despite affordability challenges and an ever-changing housing market, This Old House suggests several tips for pursuing homeownership in 2024.

“Doing the necessary research ahead of time on property taxes in the area, putting down more money upfront, or looking for FHA loans can help you avoid more expenses down the road,”  Candiloro says. “Securing a mortgage preapproval, shopping for homeowners insurance, and making a moving budget are all things to consider if you’re looking to buy your first home this year.”

This story was originally featured on Fortune.com