Half of Homeowners Feel Holiday Stress Due to Rising Mortgage Costs

Rising mortgage costs and inflation are reshaping how homeowners plan to celebrate the holidays. From cutting back on gifts to hosting smaller gatherings, Americans are finding ways to preserve the festive spirit without overspending. This article explores how homeowners across generations are adapting their spending habits and managing hosting costs amid financial challenges.

Key Takeaways

• Nearly half of homeowners (48%) feel more stressed about holiday spending this year because of rising mortgage costs.
• 51% are reducing the number of people on their holiday shopping lists due to high mortgage costs.
• 1 in 9 plan to skip gift-giving entirely this year.
• 28% are decreasing the size of their holiday gatherings due to financial constraints.
• 53% plan to cut at least one dish from their holiday dinner to save money.

Homeowners' Holiday Spending Challenges

Americans are adjusting their budgets, cutting back on shopping lists, and exploring creative ways to celebrate this holiday season.

Nearly half (48%) of homeowners reported feeling more stressed about holiday spending compared to last year because their mortgage costs have gone up. Gen Z homeowners lead the way, as 41% expressed concerns about their budgets falling short this season.

To manage costs, 51% of homeowners said they are reducing the number of people on their holiday shopping lists, and 1 in 9 homeowners plan to skip gift-giving entirely. Among younger homeowners, Gen Z was the most likely to forgo gifts altogether (24%).

Despite financial challenges, some homeowners still plan to spend significantly. On average, respondents budgeted $479 for gifts this year, or about $89 per person. Nearly 1 in 5 homeowners (19%) anticipated spending $1,000 or more on gifts. However, these expenses may come at a cost, as 1 in 3 homeowners planned to rely heavily on credit cards for holiday purchases, with millennials (37%) being the most likely to do so.

To save money, many homeowners were considering alternative gift-giving strategies, such as:

• DIY gifts (34%)
• Experience-based gifts (28%)
• Secret Santa (27%)
• White Elephant exchanges (21%)
• Second-hand gifts (19%)
• Regifting unused items (17%)
• Gift card pooling (15%)
• Cookie swaps (13%)

Among Gen Z, 42% are planning on doing a Secret Santa as a cost-saving measure, while 1 in 5 are pooling their money with others to buy gifts.

Cost-Cutting Strategies for Holiday Hosting

Holiday gatherings remain a cherished tradition, but rising costs are prompting homeowners to get creative with their celebrations.

Gen Z homeowners are the most likely to host this season, with 53% planning to hold a holiday gathering. However, financial constraints are a significant factor for some, as 25% of Gen Z said they would skip hosting altogether due to costs.

Among those hosting, nearly 1 in 5 homeowners anticipated spending more than $300 on their holiday gatherings, and estimated per-person costs varied by generation:

• Gen Z ($41)
• Millennials ($29)
• Gen X ($27)
• Baby boomers ($25)

To manage hosting expenses, 48% of Gen Z homeowners plan to reduce or simplify their holiday decorations. For others, cutting costs means thinking outside the box: 1 in 12 Gen Z homeowners said they'll include fast food items in their holiday meals to make them more affordable.

Overall, 28% of homeowners said they are downsizing their holiday gatherings to stay within their budgets. This includes 33% of millennials and 28% of Gen Z. Another 22% of millennials and 20% of Gen Z said they intend to organize potluck dinners to share costs.

Reducing Holiday Dinner Expenses

Cutting back on dishes has become a common strategy for saving money without compromising the joy of gathering around the table.

More than half of homeowners (53%) said they plan to eliminate at least one dish from their holiday dinner this year to reduce expenses. Among Gen Z, this trend was even more pronounced, with 68% planning to trim their menus.

Despite these cuts, some staples remain untouchable for most households, as homeowners are least likely to remove these classics: mashed potatoes, bread or rolls, stuffing or dressing, green beans, roast potatoes, Christmas cookies, and mac and cheese.

Finding Joy in a Budget-Friendly Holiday

Despite financial pressures, homeowners are finding innovative ways to celebrate the holidays while staying within their means. By prioritizing meaningful traditions, simplifying hosting plans, and exploring creative gift-giving strategies, Americans are proving that the holiday spirit doesn't depend on extravagant spending. With resourcefulness and a focus on what truly matters, this year's holiday season can still be a joyful and memorable time for all.

Methodology

We surveyed 1,007 homeowners to explore how inflation and rising mortgage costs are reshaping holiday plans. The generational breakdown was 8% Gen Z, 48% millennials, 34%Gen X, and 10% baby boomers. The data was collected in November 2024.

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