Home insurers take note: homeownership by millennials and Gen X grew in 2023, while Gen Z lagged, according to a new report by Redfin, an online real estate brokerage firm. Even so, most Gen Zers are tracking ahead of their parents at the same age, most likely due to record low mortgage rates in the past.

Just over a quarter (26.3 percent) of adult Gen Zers owned a home in 2023, a small boost from 26.2 percent in 2022, according to Redfin’s data.

The homeownership rate for millennials rose to 54.8 percent from 52 percent, and the homeownership rate for Gen X rose to 72 percent from 70.5 percent.

Baby boomer homeownership changed little, up 78.8 percent from 78.7 percent in 2022. This figure is down from the record 79.7 percent in 2020, likely the result of an aging population.

It was an especially hard year to buy a home; mortgage rates surpassed 8 percent for the first time since 2000 and housing prices remained stubbornly high, according to the Redfin report. This resulted in soaring mortgage payments, likely stalling Gen Z’s home-buying plans, considering they may be at the start of their career and don’t have enough money saved for large purchases.

2024 should be different, according to the online real estate broker, since mortgage rates have already dropped from more than 8 percent in October to 6.8 percent percent as of mid-January.

“Housing affordability remains strained, but things are looking up for Gen Z,” said Redfin Chief Economist Daryl Fairweather. “The recent decline in rents means Gen Zers can put more money toward saving for a down payment. Plus, the job market is strong, and career opportunities have become less concentrated in expensive cities during the remote work era, meaning many Gen Zers can choose to live somewhere more affordable.”

According to Redfin, homeownership rates for 19-to-25-year-old Gen Zers are higher than the homeownership rates were for millennials and Gen Xers when they were the same age. “For example, the rate for 24-year-old Gen Zers is 27.8 percent, compared with 24.5 percent for millennials when they were 24 and 23.5 percent of Gen Xers when they were 24.”

At the time, millennials were in their early twenties, still struggling to find work due to the Great Recession, making it more difficult to afford a home, Redfin added.

When Gen Xers were in their early twenties, they were hit with some of the highest mortgage rates in history; rates were around 11 percent in 1989, when the oldest Gen Xers were 24.

Gen Zers are more savvy home buyers, said Jon Byram, a Redfin Premier real estate agent in Northern Virginia.

“Gen Zers have done their research. They know all of the real estate jargon and are entering the housing market more educated than prior generations,” he added. “Some young first-time buyers are also coming in with financial help from family, or co-buying with family members, which boosts their buying power. And some have savings because they’ve been living with their family rent-free.”

The only Gen Zers who are tracking behind prior generations are 26-year-olds, who were the oldest Gen Zers as of 2023, according to Redfin. The homeownership rate for 26-year-old Gen Zers is 26 percent, below 31 percent for millennials at 26, 32.5 percent of Gen Xers at 26, and 35.6 percent of baby boomers at 26.