A new reason for millennials’ inability to buy a house in the current market has emerged.
Home ownership among the 25-40 age group has been a subject of controversy in the real estate industry, as the percentage of millennials owning property has steadily decreased each year.
Recent research in the Australian real estate market has shown that a viral trend, popularized by Hollywood, could be hurting millennials’ borrowing capacity.
Potential homeowners spending heavily on this new fixation is reportedly a factor that money-lending institutions are taking into account when deciding who gets to take out a house loan, according to an expert.
Taking weight-loss injections is slashing millennials’ homebuying ability by nearly $100,000
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According to Money.com.au, the use of viral GLP-1 weight-loss medications, such as Oz*mpic, Mounjaro, and Wegovy, is affecting Australian millennials’ homebuying capacity.
GLP-1 injections are prescription medicines that help diabetic patients manage weight by regulating blood sugar levels and appetite. However, it became popular as a weight-loss solution after several Hollywood celebrities and influencers admitted to using GLP-1.
The study found that the average Australian is spending $610 a month on weight-loss injections, which is significantly reducing their borrowing power.
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The platform’s senior mortgage broker specialist, Debbie Hays, said that a regular expense of that magnitude could raise questions when calculating the Household Expenditure Measure (HEM). It is a benchmark used by Australian lenders to assess the minimum expected level of household spending of the loan applicant.
“When you submit your bank statements to a lender, it is their obligation to go through them, and if they find a regular direct debit of $700, they will question what it is,” Hays told Daily Mail.
“It’s a higher expense than private health cover for a single applicant, so a lender can determine it reduces their borrowing capacity by $80,000 to $100,000.”
A $610 monthly expense is about 15% of the average $4,180 monthly mortgage payment in Australia.
Even if an individual was taking the medication as prescribed, the outcome would be the same.
About 17% of Australians currently take GLP-1 injections, but only 7% take them for a medical condition like diabetes, according to the Daily Mail report.
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“If someone is overweight and starts taking these dr*gs and they also want to save for a home, it impacts their borrowing ability,” Hays added.
In the current market, borrowers should consider every expense to be held against them and disclose their expenses accordingly, Hays warned.
Another Money.com.au report, published in January, showed that one in five potential homeowners significantly underestimated their living expenses when applying for a mortgage.
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“Most people don’t know how much they spend each month,” Hays said in the report.
“More often than not, mortgage applicants will have an estimate of their living expenses, and when you go through their bank statements, you find glaring inconsistencies. You want to find those errors before you submit your loan application.”
Millennials own less than two-thirds of U.S. real estate compared to baby boomers
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Over the past three decades, the real estate ownership scenario in the United States has changed dramatically.
An infographic by Markets in a Minute, reported by Visual Capitalist based on Federal Reserve data, showed that millennials own less than two-thirds of the real estate that baby boomers owned at the same age.
In 1991, the silent generation owned 65% of the homes, and baby boomers owned the rest. In 2025, boomers account for 41% of real estate ownership, Gen X owns 30% of the homes, and the silent generation’s share has dropped to 9%.
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Millennials, who owned zero percent homes in 1991, now account for only 21%.
In 2020, only 37.3% of homeowners in the USA were under age 35, according to a report by The Zebra Insurance.
A National Association of Realtors (NAR) survey found that some of the largest and most expensive housing markets in the country had the lowest percentage of millennial homeowners.
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In Los Angeles, only about 30% of households aged 25-44 own their home. In San Jose, the home-ownership rate for this age group is about 34%, and in San Francisco, around 37%.
In New York and San Diego, the percentage is well below the national average.
“Avocado toast” may not be the reason millennials can’t buy homes
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Australian real estate mogul Tim Gurner said in 2017 that millennials were not able to buy homes because they were spending on things like “avocado toast brunches.”
His suggestion gave rise to the viral avocado toast memes. “I ate avocado toast this morning and now I’m homeless,” one of the jokes from the time read.
But it also kick-started a discourse in which several other everyday expenses, such as lattes and streaming services like Netflix, were blamed for the low millennial home-ownership rate.
However, surveys show that the reality is much different.
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A Redfin report published by National Mortgage Professional said that since mortgage rates began rising in 2022, from 3% to 7%, housing affordability plummeted even further. In early 2024, the average monthly payment for a new home hit a record high of $2,800.
For millennials, there were several other factors as well.
According to NAR, more than 50% of home buyers under 36 said student debt delayed their home buying.
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A tighter lending standard is another reason.
Banks have tightened credit underwriting to reduce risk and doubled down on the 20% down payment rule for homebuyers. With inflation, millennials are requiring longer to accumulate enough wealth to put down on a home.
“Remember that the bulk of the current 25- to 34-year-old cohort started their careers during the financial crisis and early stages of the recovery, when the economy and labor market were fragile,”
Getting married or starting families later in life, compared to baby boomers, is another reason often cited for the delay in millennial homebuying. However, in many cases, it is the other way round.
Studies have found that the inability to buy a home has often deterred millennials from tying the knot or having a baby.
“Millennials are trying to navigate a constricted and racist housing market and a nation with outdated urban infrastructure, so much of which is out of line with what we want and what we need to remain gainfully employed, financially stable, and moderately happy,” journalist Jill Filipovic wrote in her 2019 book, Ok Boomer, Let’s Talk.
“Math’s not hard. The system is.” The internet reacted to millennials’ inability to buy homes in the current economy
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