The Bulk of U.S. Home Deeds Are About to Be Passed Along. Millennials, Are You Really Ready?

A Realtor.com survey is out, showing 23% of millennials feeling ready to buy a home in the next six months. This is an interesting turn in attitudes. And it only appears with millennials. Just 15% of their generation felt ready in late 2024.

If you happen to be a millennial getting ready to buy — or a boomer getting ready to let go of your home — here are some thoughts on how you fit into the current real estate market.

What Are You Getting Into?

Some will buy. Some will inherit. Some will not have that mental readiness, and will feel caught off-guard by their inheritances. What to do? Rent this home? Sell it? Maybe it’s dated. Fix it up first? Find a broker that handles renovations? Or sell it at a discount price?

Baby boomers hold the deeds to 40+ percent of U.S. real estate value. As a whole, it’s as though boomers haven’t budged. They’re now staying in their homes almost twice as long as they used to, according to Redfin. But we know death and taxes are inevitable, and this major generation is at the brink of leaving those homes to their juniors.

As Valuable as Boomers’ Homes Are, Many Need TLC

Not all current deed holders will leave good directions on what to do with the homes they leave behind — let alone the funds to help carry out those plans. It’s one reason Redfin housing economist Daryl Fairweather sees the great deed handoff as a mixed blessing for the younger generations.

Varied, sometimes unexpected factors will put young people to the test:

• The homes they inherit are not typically homes they’d choose for themselves.

• Especially in markets where climate has become a major financial drag, insurance policies for  older homes can come with sticker shock.

• Some homes will have weighty liens to resolve. Many older adults have borrowed against home equity to take care of their medical bills.

Millennials, take a deep breath. More than two-thirds of boomers have kept their homes for decades. Imagine clicking on a house tour video and finding yourself back in the 1990s…

If I’m the Older Adult Who’s Leaving a Home to a Younger Loved One, What’s Most Important?

Current deed holders, have you written down good directions in your estate planning documents to help prepare your beneficiaries? Will the next deed holder know what to do with your home?

Maybe there are liens on your home. These could reflect unpaid debts, mortgages, or reverse mortgages. Having a plan to resolve those outstanding title issues is most important.

Those who come after you in the chain of title will benefit from your planning. If your home is going to loved ones, you might want to lay out how long the home can belong to any current residents, how insurance, upkeep, and taxes will be covered, and how the beneficiaries should distribute home sale proceeds.

Placing your deed in a trust can help the next generation. It can offer direction so survivors know how to handle the home when you’re no longer around. Some trusts, though, prove burdensome down the road. Heirs whose hands are tied by family trusts sometimes go to court to disconnect themselves from well-meaning legacies.

What If You’ve Inherited a Home That’s Surged in Value?

Most millennials know capital gains get taxed when someone sells an asset for more than they paid in the first place. If a deed holder bequeaths (not gives away) a home, the heir gets an easier tax outcome when selling a home that has surged in value. The Internal Revenue Service lets heirs declare a stepped-up cost basis, so they don’t pay taxes on the rising property value that their parents accumulated.

The heir to a deed who wants to sell it can use the home’s value when inherited as a cost basis. This allows far less in accumulated value to be taxed — often none.

The IRS offers worksheets so home sellers can calculate taxable capital gains. Review IRS Publication 523: Selling Your Home.

You might be exempt from capital taxes, and yet it’s good to understand them. Take the time for due diligence when selling an inherited house.

While we’re on this point, let’s look at one more tax issue…

Remember to Check the Property Taxes

Those who receive a home in this era need to be aware of the rise in valuation of the home (a.k.a. inflation) over the past few years. How has the upward pressure on the home’s assessed value impacted local taxes? The median U.S. property tax bill now exceeds $3,000 annually! And a deed transfer sets a home up for yet another tax assessment.

So, if you receive or buy a home, check on the property taxes. Have a plan to ensure they’re always covered. Property taxes can be a deal-breaker for some.

If the costs are just too steep, you do not have to accept a deed. Recipients always have the choice of whether to accept or to turn down the deed.

Other Trends in Generational Attitudes to Homeownership

Here are a few more findings from the recent Realtor.com® Survey:

• Only millennials have a rising interest in buying a home in the next six months (as compared to their views last September).

• Most people surveyed said they have no plans to receive or transfer a real estate deed during the remainder of 2025.  

• Half of current deed holders with mortgage balances feel stuck in place because getting a new mortgage would mean paying higher interest.

• Most current deed holders believe that mortgage interest rates won’t go down any time in the coming year.  

• If rates dip down, many deed holders would be more likely to sell their homes than they are now.

• A mortgage rate over 6% is nearly universal put-off.

• Almost two-thirds of potential mortgage borrowers say a rate below 5% is what they’re looking for.

• Gen Z continues to rent. Since last year, a greater portion of this young cohort will have to delay buying. Prices and mortgage rates are just too high.

If there’s an obvious takeaway from the Realtors.com survey, it’s this. Most people view mortgage interest as a key factor in their willingness (or not) to become home buyers. A third of potential buyers have stepped back from their home buying goals because of this — echoing the survey responses from last year.