According to a recent poll, owning and living in a freestanding house

Thanks for your reply MartyTargetTestPrep,

Could you please help me in one additional doubt. Can't that in "like that of earlier generations" refer to goal and then the comparison would be between like goal of young adults and goal of earlier generations?

To clarify, "that" does not always function as a pronoun and even when functioning as a pronoun it's not always acting in this "new copy" fashion. This particular sentence, however, does have "that" acting as a pronoun where it would be a new copy. Here is another GMATPrep sentence that uses "that" in the same way: "The Neanderthal had a vocal tract like THAT of the apes" (I'm pulling from memory so that may not be word-for-word).

Using the pronoun "that" to represent a new copy doesn't work particularly well here. It makes sense when you are talking about things that obviously cannot be shared: "Their house looks just like that of my parents" or "Her dancing was superior to that of her rival". [Notice that the "new-copy" that construction is a bit awkward and can be easily stated in other ways, such as using the possessive.] In this sentence the goals are shared and not exclusive, so it doesn't really call for "that" as a pronoun.

The real kicker against "that" in this problem (as cited by the OA) is the lack of parallelism between the main clause and this subordinate clause. "That" would stand in the place of the very long idea "owning and living in a freestanding house on its own land", which is followed by the verb "is". To be parallel, we would need to include the verb "was" after "that" to be parallel in structure. ....owning and living in a freestanding house on its own land is a goal..., as that was... [again, I would prefer using the pronoun "it" to indicate the goals are the same]

KW