FT: The US housing crisis is pushing Generation Z toward cryptocurrency and "economic nihilism"

On December 7, the Financial Times published an article stating that the continuously worsening housing affordability in the United States is profoundly changing Gen Z’s financial and consumption behaviors, even pushing some young people toward cryptocurrency speculation and fostering a sense of “economic nihilism.” The imbalance between housing prices and income has become a core force affecting the economic behavior of young people. Faced with the distant goal of homeownership, some young people are choosing to “lie flat,” reduce savings, and invest more frequently in high-risk assets like cryptocurrencies. Surveys show that young people who believe that buying a home is unrealistic are more likely to exhibit three behaviors: reduced savings, decreased work motivation, and increased speculative investment. In contrast, those who still believe they can buy a home in the future tend to save and plan more proactively, as their belief in achieving the goal changes their incentive structure. The article emphasizes that as the opportunity cost of buying a home soars, more and more young people are investing their time and money in areas that offer more immediate feedback, such as speculative markets. To reverse this trend, policies need to directly improve housing supply and prices, for example: loosening building restrictions, increasing the construction of affordable housing, and optimizing land use regulations. The FT believes that improving young people’s financial literacy is also crucial, including skills such as budgeting, investment basics, risk assessment, and long-term savings planning, which will determine whether they can achieve their goal of homeownership in the future.