Rising costs of housing pushing millennials to make 'drastic sacrifices' by living in vans for years

The rising costs of living over the last few years have driven the younger generation to make "drastic sacrifices" in order to reset their financial stability or be able to own a home in the future.

Younger people are opting to live in cost-effective vans and showcase their tiny living quarters on TikTok to the fascination of the internet. 

Michael Alberse, a TikToker with 57,000 followers, moved into a van one year out of college while working at Google at the age of 22, which changed his financial future "forever" and paved the way to homeownership. 

"I chose to live in a van as a short-term sacrifice to almost guarantee my long-term financial future," he said. 

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"I chose to buy a van and build it out so I could save money on rent and put those additional dollars into investments… So it's not my forever plan. But at least it's a great start, so I have a strong base for my future."

Alberse called his motor home "Ted," and lived in it for about a year before selling it after getting "pretty homesick and lonely." 

After selling the van, he moved in with his parents with his fiancée. 

Alberse then moved from California and bought a home in Atlanta after transferring teams at Google, he said. 

"I have a stationary home… and life looks a little different now, but very fulfilling, very happy," he said. 

A van-dwelling couple, Court and Nate, have amassed 2.5 million followers showcasing their lives on the road for nearly five years. 

Court, 36, said they were able to save over $70,000 in the first few years of van living. She also said they were able to address any debt that they had and recently bought land in Southern California. 

"We did not get into a van to be on an external vacation. We very much set out on this journey with a purpose… to hopefully one day gain some financial stability while still enjoying our lives," Court said.

"Before we moved into our first van we were on track to absolutely never be able to own a home one day," she said. 

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"After all this time and all the sacrifices that we've made… there's no way that I could settle going back to a rental. Because for us, that would probably mean we would never be able to buy a home."

"It's just so expensive. Why is housing so expensive?" she added

The U.S. median price of a newly-built home is near its all-time peak, which was reached under President Biden. Though, as of the December 2023 reading (the latest available), the price is down from its all-time high reached in October 2022. 

As for the U.S.’ average interest rate on a 30-year fixed rate mortgage, which is tracked weekly by Freddie Mac, the rate is near a multi-decade high, though it has fallen from its Biden-years’ peak (reached in October 2023) over the past several weeks.

The interest rate on a 30-year fixed-rate mortgage is currently at 6.625%. 

The younger generation is realizing that "cutting Starbucks and Netflix isn't enough" to create the financial future of their parents, according to an Orlando, Florida-based realtor and TikToker Freddie Smith.

"I think that's going to be a very popular story in the next three to five years, because people are just now having to make those drastic sacrifices," he said. 

The issue many younger people are facing when it comes to buying a home is that over the last approximately three years, the median household income can no longer afford the median home, Smith said. 

"The biggest problem that millennials and Gen Z's are having is their income isn't high enough, unfortunately, to qualify for the average house in America," he said. "So to buy a $400,000 home, which is roughly the average cost in America, you're going to need over $100,000 with very little debt to be able to qualify." 

"As far as the living in a van, this is advice that people are taking," Smith said. "I'm seeing this become wildly popular because they're getting rid of that $2,000 rent burden, and they're able to use that money to save for a down payment. Because the bigger the down payment, the less income you need to qualify." 

TikToker Summer Ginther saved enough to afford a down payment after living on the road for three years with her partner. She explained that one of the more unfortunate aspects of van living was having to store waste in a tank that needed to be emptied "about once a week."

"It's definitely not a fun job," she said.

Another aspect of van living was isolation. 

"We definitely do not get to see our family and friends as often as we'd like to, and we miss having that community feeling," she said.

A "vanlife" couple, Will and Meebs, who have 86,000 followers, reiterated the hardships of isolation and "driving for hours in the middle of the night." 

What's hard is "not meeting anyone else our age (or anyone doing the same thing)" as well as "loneliness" from not seeing friends and family as often, they said.

The couple also said that life in a van can be scary when it comes to extreme weather.

"[During our] first proper night in the van there was a huge storm," the couple said on TikTok. "[We were] so SO worried about lightning and wind."

Another concern they had was when they tried to hang their clothes to dry after washing them, "they froze." 

Another TikToker, Dylan Gray, moved into a van in 2019 to save for a home. At the time, he was $3,000 in debt and was working full-time. 

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"It was the most challenging year mentally and physically," he said about living in van. But one year later, he is debt-free and bought his first home.

"Life is what you make it," he said. "The hard work you put in, is what you get out."