TD Bank survey of 1,003 aspiring homeowners reveals a generation willing to stretch financial limits to own
First-time homebuyers are entering 2026 armed with resilience, flexibility and a willingness to rewrite the traditional rulebook on homeownership.
A new annual survey from TD Bank, polling 1,003 Americans who plan to purchase their first home this year, reveals a cohort that is optimistic but stretched, and increasingly open to financial strategies that would have seemed unconventional just a few years ago.
Nearly three-quarters of respondents said they would consider a 50-year mortgage if one were available, while 78% of younger millennials and 74% of Gen Z respondents indicated they would tap their 401(k) to fund a first home purchase if permitted to do so.
Half of those surveyed said they would be comfortable buying a fixer-upper under current market conditions.
"First-time homebuyers' desire and motivation to buy remains strong, and they are approaching their budgeting and financial boundaries with flexibility," said Steve Kaminski, head of residential lending at TD Bank US.
"They are open to various alternative approaches to make that first purchase possible amid elevated rates, broader economic uncertainty and limited inventory."
The findings land at a moment when mortgage professionals across the country are wrestling with how best to serve a client base that is determined to own, yet constrained by a market that continues to test their limits. Affordability improved across all 50 states by the end of 2025, yet conditions remain well short of pre-pandemic norms for most entry-level buyers.
Read more: First-time homebuyer share hits record low as median age climbs to 40
Retirement savings and budget thresholds under pressure
The survey surfaces a concerning pattern in how aspiring buyers are managing their broader financial health.
Nearly one in three first-time buyers polled, or 31%, said they reduced or halted retirement contributions while saving for a home purchase.
Meanwhile, the traditional 28% mortgage-to-income threshold is increasingly being abandoned in practice: more than half of respondents (54%) anticipated spending between 26% and 35% of their monthly income on mortgage payments, up from 48% the previous year.
That upward drift speaks to a generation prioritizing homeownership even at the cost of financial buffers.
Matt Gouge, mortgage broker and founding partner at UMortgage, has observed the same shift firsthand. "Buyers, especially first-time homebuyers, have to be a little bit more flexible," Gouge told Mortgage Professional America earlier this year.
"They have to start thinking about housing, especially their first house, as a stepping stone, not a forever home."
Read more: Gen X mortgage stress deepens as retirement doubts grow
Family support is also playing a growing role in bridging the gap between aspiration and access. Two-thirds of survey respondents said they were receiving, or planned to receive, financial support from family members, rising to 76% among younger millennials.
For brokers fielding calls from buyers whose down payment strategies hinge on gift funds and generational transfers, the numbers affirm what many already know on the ground.
Despite the financial strain, sentiment is running high. Eighty-one percent of respondents described themselves as optimistic about the housing market in 2026, with an equal share agreeing that homeownership remains a sound long-term investment.
Nearly three in five expected to remain in their first home for more than a decade, up from 51% a year earlier.
A gap in lender engagement that brokers can fill
Perhaps the most significant finding for mortgage professionals is the persistent disconnect between buyer ambition and lender contact.
Only 27% of first-time buyers surveyed said they spoke with a mortgage lender as part of the homebuying process, and just 22% obtained pre-qualification or pre-approval, despite their stated plans to purchase in 2026.
"First-time homebuyers crave access to clear guidance and reliable advice, which is more important than ever in today's environment," said Scott Lindner, national sales director at TD.
"Meeting with a lender early in the process helps them better understand how they should structure their timeline, prepare their full financial picture, make a budget and assess other common costs in their region."
As one executive explained to MPA, brokers are uniquely positioned to serve this segment precisely because affordability challenges are not uniform and borrowers do not fit neatly into one profile.
"Having access to and understanding different tools, like down payment assistance programs and other low-down-payment programs, allows brokers to responsibly bridge the gap between income and savings," said Miki Adams, president of CBC Mortgage Agency.
On the credit preparedness front, buyers are becoming more proactive: 70% of those monitoring their credit were making on-time payments, up from 60% the prior year. FIfty-seven percent were actively paying down debt, compared to 51% in 2025.
Checking credit reports for errors also surged, with 59% doing so versus 44% the year before. Over half of respondents had also created a formal homeownership budget, up from 48% in 2025.
Over half also created a formal homeownership budget, an increase from 48% the previous year.
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