For much of the postwar era, Americans bought a starter home and watched it appreciate into an investment. Decades later, the familiar American Dream of a house with a white picket fence has become far less attainable as home prices have risen 235% since January 2000. As a result, many younger Americans are putting more of their wealth-building efforts into the stock market, treating brokerage accounts as a new version of the American Dream.

“For younger adults who despair about ever being able to buy a home, investing in financial markets can be a great way to save until they can afford one,” Chen Zhao, head of economics research at Redfin, told Fortune.

Zhao’s point is reflected in the numbers. Fewer than half of Gen Z and millennials can afford to buy a home, and the average age of a first-time homebuyer has risen from 28 in 1992 to 40 in 2025. Even so, more than two-thirds of Americans still say buying a home remains an important asset that holds value. But as homeownership becomes a remote goal for younger generations and home costs have climbed roughly 50% in recent years, young adults are treating down payments as a starter asset while they build a record $3.1 trillion in stock holdings, up 4.5 times since the pandemic.

That pressure is already affecting behavior. Nearly a third of Gen Z adults, 31%, say they have delayed buying a home because of financial pressure, and 34% worry they may never be able to afford one, according to Northwestern Mutual’s 2026 Planning & Progress Study.

George Eckerd, research director for wealth and markets at the JPMorganChase Institute, said the scale of investing is helping drive the shift. Stock ownership rates have “gone up so much” that, alongside flat or softening homeownership, “that is a significant change in the way young Americans are building wealth,” Eckerd told Fortune.

Instead of placing every housing dollar into savings, younger Americans are increasingly viewing stock investments as money that can later be converted into a down payment if homeownership becomes possible. Among Gen Z and millennials who recently bought a home, one in five sold stocks to help pay for the down payment, compared with twice that share among boomers, according to a 2025 Redfin survey. More than half of millennials also say they feel forced to choose between investing for retirement and buying a home.

Eckerd said stocks and homes remain fundamentally different tools. Stocks are liquid and easy to diversify, while a house is typically concentrated in one property and financed with leverage, even though homeownership does provide tax advantages.

“The housing cycle can be somewhat different than the stock market cycle, but they do tend to at least be affected by some similar factors, like recessions and interest rates,” Eckerd said.

Young Americans hold record stock wealth as the median homeowner age rises

The Federal Reserve has tracked the share of the stock market owned by Americans under 40 since 1989. Their combined holdings are now larger than ever, reaching $3.09 trillion this year.

Stocks and mutual funds now account for a much larger portion of young households’ balance sheets. Equities made up just 9% of under-40 households’ net worth in 1989; today that figure is 27%, the highest share on record. Younger investors are also starting earlier. According to a Charles Schwab survey, Gen Z begins investing at 19 on average and millennials at 25. A Schwab spokesperson told Fortune that Gen Z now accounts for a third of new Schwab clients.

Other financial milestones are arriving earlier as well. Gen Z began saving for retirement at age 22 on average and millennials at 28, according to the 2026 Northwestern Mutual study, years earlier than their boomer parents and grandparents.

All of this is happening as some measures put the median age of a homeowner in 2025 at 59, up from 39 in 2005. While 90% of Gen Z respondents in a recent report said they want to own a home one day, 79% said they are being priced out of the market.

The link between more young retail investors and housing affordability also appears in a recent JPMorganChase Institute report co-authored by Eckerd. It found that 37% of 25-year-olds had a retail investment account in 2024, six times the share in 2015, as retail investing flows rose roughly 50% from 2023 to early 2025.

The report also said declining affordability “may be shifting the allocation of savings, making financial assets like stocks relatively more attractive or accessible than home equity.”

Eckerd said part of the difference is psychological. A mortgage effectively locks borrowers into a monthly saving mechanism through principal repayment, while a brokerage account funded by discretionary transfers usually does not, unless it is a 401(k), where automatic payroll deductions create similar discipline.

“Some people want to be locked into a monthly saving mechanism by paying their mortgage every month and accumulating that equity,” Eckerd told Fortune. A brokerage account, he said, does not impose that same requirement. “Whereas they might not have the discipline to actually make a discretionary decision to send another dollop of money to their brokerage account every month.”

Risks facing younger investors

Even when younger adults treat brokerage accounts as a substitute for mortgage-style saving, some may be drawn toward meme stocks, crypto and leverage rather than diversified investing, Douglas Boneparth, a certified financial planner and president of New York wealth-management firm Bone Fide Wealth, told Fortune.

“People go to riskier assets because they feel there may not be any other way to generate wealth,” Boneparth said.

He said social media amplifies that tendency by creating a “very noisy world” in which algorithm-fed flashes of quick riches can make disciplined investing seem less appealing. That pressure can push people who feel priced out into taking on excessive risk, such as going “triple levered on semiconductors” instead of making steady monthly contributions.

“You can download an app on your phone and instantly start trading,” Boneparth said. “I don’t like the fact that it doesn’t teach you anything about being a disciplined and consistent investor, and you can lever yourself up and put yourself into some pretty precarious financial situations if you’re not careful.”

Recent data from Schwab supports that concern. Its August client sentiment survey found that 48% of its Gen Z clients are bullish on the U.S. stock market, up from 24% the previous quarter. The survey also found that 41% of Schwab’s active traders describe themselves as at least somewhat risk-seeking, and 84% said they would buy the dip rather than pull back.

Although apps such as Robinhood have made market access easier than ever, Eckerd said that does not necessarily mean wealth-building has become truly democratized. His research found that lower-income investors have been “accumulating later” in the market’s upswing, meaning they often buy only after valuations have already risen.

Eckerd linked that pattern to the labor market, noting that disadvantaged groups tend to face more cyclical unemployment, so income gains often arrive late in an economic cycle. Separate academic research he conducted found a similar pattern in housing, where lower-income areas and Black communities have shown more cyclical participation in homebuying since the 1990s.

In both markets, Eckerd said, disadvantaged groups “only can afford to accumulate assets when they’ve already appreciated.”

This story was originally featured on Fortune.com