Interest in 'house hacking' explodes among Millennial and Gen Z home buyers seeking extra income

More than half of young home buyers consider renting out all or a portion of their home to produce additional income.

SEATTLE, Nov. 16, 2023 -- Young home buyers, who more often struggle to afford a down payment and mortgage, are leading a popularity surge in house hacking – renting out part or all of a home for extra cash.

A recent Zillow® survey shows most Millennial (55%) and Gen Z (51%) buyers find it very or extremely important to have the opportunity to rent out part of their home for extra income while living in it. That's compared to 39% of all homebuyers, which is up eight percentage points in the past two years.

Zillow's 2023 Consumer Housing Trends Report (CHTR) also shows that more than half of Millennial (59%) and Gen Z (54%) buyers say it's highly important to be able to rent out the entire home in the future, compared to 43% of all buyers.

"Younger homebuyers — mostly Gen Z and Millennials — are especially into the idea of rental income as a key factor in their home buying decisions," said Zillow senior population scientist Manny Garcia. "For those first-time buyers navigating the 'side hustle culture,' where a regular 9-to-5 might not quite cut it for homeownership dreams, rental income can step in to help with mortgage qualification and smoothing out those monthly payments."

Zillow's survey also further illustrates the disproportionate impact of the affordability crisis on households of color, while reinforcing that people maintain an unwavering desire to own a home regardless of market conditions.

Latinx homebuyers prioritize the potential for rental income at a higher rate than other racial groups. Among Latinx buyers, 51% expressed interest in renting a portion of the home for additional income while residing in it, followed by 46% of Black buyers and 40% of white buyers.

To empower homeowners looking to generate income, Zillow developed a suite of tools, available through Zillow Rental Manager, including free listings, pricing suggestions, background checks, online applications, and state-specific lease generation. These resources provide comprehensive support for those seeking rental income from their single-family or multi-unit properties.

Successful Buyers: High Importance of Rental Income from Home Purchase by Generation

(based on 2023 CHTR data)

Successful Buyers: High Importance of Rental Income from Home Purchase by Race

(based on 2023 CHTR data)

Prospective Buyers: High Importance of Rental Income from Home Purchase among Home Shoppers

(based on 2023 CHTR data)

About Zillow Group

Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, great partners, and easier buying, selling, financing and renting experiences.