The age of first-time homebuyers has shot up to an all-time high. A National Association of Realtors report says the median age in 2024 jumped to 38, up three years from 2023, reports Yahoo Finance. "The first-time homebuyer who can enter into today's market is older, has a higher income, [and] is wealthier," NAR economist Jessica Lautz tells CNBC. A look at the factors at play:
- Key stat: NAR's data comes from 5,390 buyers who bought a home over the period of July 2023 through June 2024. The share of people buying their first home shrank to 24% from 32% in 2023—the lowest since NAR started running the report in 1981. Back then, first-time homebuyers were typically in their late 20s.
- Housing shortage: Zillow economist Orphe Divounguy calls a housing shortage the "biggest issue of housing today" because it's keeping prices high. NAR places the deficit at 4 million new homes needed. Building has begun picking up recently, with a 2.7% jump in construction projects from August to September.
- Boomer market: Baby boomers continue to edge out younger buyers, using equity to buy homes on the market outright. Buyers today need higher down payments, which boomers are better able to afford. There's also an all-time high—26%—of buyers who can afford to pay with cash. Meanwhile, high rents are a contributing factor in keeping younger people from being able to save enough to buy.
- Best bets: MoneyWise has tips for young prospective buyers. Seeking a home in more affordable, smaller real estate markets can open up possibilities. They also recommend shoring up your finances by reducing debt, and looking into federal and state assistance programs to buoy your chances.
(Millennials' tactic on the
housing market: Live with their parents.)
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