Your Netflix Bill or a New House? A Study on the Path to Homeownership

COLUMBIA, MO – February 12, 2026 – A new analysis suggests the path to a starter home might be paved with canceled subscriptions and home-cooked meals. According to a report released today by the Mortgage Research Network, young renters could potentially trade their discretionary spending habits for a 5% down payment on a home in less than three years in dozens of major U.S. cities. The study, titled "Streaming or Starter Home?", posits that by redirecting an average of $641 per month from non-essential expenses, aspiring homeowners could accumulate nearly $7,700 annually, fast-tracking a goal that many feel is increasingly out of reach.

The Price of Convenience

The report's striking conclusion is rooted in an examination of modern spending, particularly among Gen Z. Researchers at the Missouri-based network analyzed four key areas of discretionary spending: video and music streaming, food delivery, social activities, and impulse shopping. Drawing on data from sources like Deloitte's Digital Media Trends and an Ally Bank survey on social spending, the analysis paints a picture of a generation where convenience comes at a significant cumulative cost.

For instance, recent studies show that Gen Z and Millennials subscribe to an average of five paid streaming video services, with costs rising 20% in the last year alone. Meanwhile, a 2025 Ally Bank report revealed that young adults spend an average of $250 per month on social activities with friends, with nearly 60% stating that this spending negatively impacts their financial goals. A quarter of those surveyed admitted that social spending directly hinders their ability to build savings.

It's this pool of funds—spent on subscriptions, takeout, and social outings—that the study identifies as a powerful, untapped resource for savings. "Gen Z isn't going to give up every convenience any more than Gen X would have given up buying Nirvana CDs," said Tim Lucas, the report's author and lead analyst at Mortgage Research Network. "But this study shows that there are non-essential expenses almost anyone can cut to reach a financial goal... Starting small can create a snowball effect that puts homeownership within reach in just a few years."

A Tale of Two Housing Markets

While the national average timeline to save for a 5% down payment under this model is 2.7 years, the report starkly illustrates that the single most important factor is geography. The feasibility of this "streaming-for-a-starter-home" trade-off varies dramatically from one city to another, creating a deeply divided map of opportunity for first-time buyers.

In Pittsburgh, where the median home price is around $225,000, a prospective buyer could save the required $11,266 down payment in just 1.5 years by banking their $641 each month. Similarly affordable paths appear in markets like Memphis, Oklahoma City, and Detroit, where the goal could be reached in under two years. In these cities, the report's premise feels not just possible, but practical.

The picture is vastly different in the nation's high-cost coastal markets. In San Jose, California, the same disciplined saving of $641 per month would need to be sustained for a staggering 10.1 years to accumulate the $77,390 required for a 5% down payment on a median-priced home of over $1.5 million. The timeline is similarly daunting in other major hubs: 7.1 years in San Francisco, 6.1 years in Los Angeles, and 4.7 years in Boston. For renters in these areas, cutting out streaming services and social dinners feels less like a viable strategy and more like a drop in an ever-expanding bucket.

Beyond the Latte Factor: A Question of Scale

The report's findings have reignited a long-standing debate in personal finance: to what extent can individual austerity overcome systemic economic challenges? Critics of this "latte factor" approach argue that focusing on minor discretionary spending distracts from the larger crises of housing affordability, wage stagnation, and economic inequality.

While saving $7,700 a year is a significant achievement for any individual, its impact is dwarfed by market forces in many regions. In places where median home prices have outpaced wage growth for decades, the problem is often not a lack of individual discipline but a fundamental lack of housing supply and an abundance of competition. For many young people already grappling with student loan debt and the rising costs of essentials like healthcare and food, the $641 in "discretionary" income identified by the study may not even exist.

Furthermore, experts point to the need for broader policy solutions, such as zoning reform to encourage new construction, initiatives to curb institutional investment in single-family homes, and more robust support for affordable housing programs. While cutting back on non-essentials can certainly be a healthy financial exercise, they argue it is not a panacea for a housing market that has become structurally inaccessible for a large portion of the population. The report's data itself underscores this point: no amount of skipped takeout orders can single-handedly close a six-figure gap for a down payment in America's most expensive cities.

Navigating the Path to a Down Payment

Despite the debate, the core principle of disciplined saving remains a crucial component of achieving homeownership. The 5% down payment benchmark used in the study is a relevant target, aligning with the minimums for many conventional loan programs and sitting slightly above the 3.5% required for government-backed FHA loans.

However, aspiring homeowners have more tools at their disposal than just cutting expenses. A comprehensive strategy often involves a multi-pronged approach. This can include seeking out down payment assistance (DPA) programs, which are offered by state and local governments and can provide grants or forgivable loans to cover upfront costs. Exploring different loan types, such as FHA, VA, or USDA loans, can also open doors with lower—or even zero—down payment requirements.

As Lucas noted in the press release, any savings accumulated can serve multiple purposes beyond just the down payment itself. These funds can help buyers qualify for better mortgage rates, lower private mortgage insurance (PMI) costs, or provide a critical emergency fund for the inevitable expenses that come with owning a home. Ultimately, while swapping streaming for saving may not solve the entire housing affordability puzzle, it represents a tangible step that can empower individuals to gain a foothold in a challenging market, especially when combined with other financial tools and resources.