UPDATE: The median age of first-time homebuyers in the U.S. has surged to an all-time high of 40 years, according to a newly released report from the National Association of Realtors (NAR). This alarming trend reflects the mounting affordability pressures that are effectively locking younger generations out of the housing market.
This significant shift is a stark increase from just 33 years in 2021 and marks the oldest median age recorded in more than four decades. The report reveals that only 21% of home sales are attributed to first-time buyers, a drastic decrease from approximately 40% before the 2008 financial crisis.
Jessica Lautz, NAR’s deputy chief economist, emphasized the dire implications: “Today’s first-time buyers are building less housing wealth and will likely have fewer moves over a lifetime as a result.” This growing divide between seasoned buyers and first-time purchasers suggests a troubling future for younger generations seeking to own a home.
The current landscape shows a stark contrast: buyers with significant housing equity are making larger down payments and are able to offer cash, while first-time buyers face significant challenges entering the market. The emotional toll is evident, as less than 40% of adults under 30 believe the American dream of homeownership is still attainable, compared to nearly 70% of those aged over 65, according to Pew Research.
The report warns that delaying homeownership until age 40 instead of 30 could cost first-time buyers approximately $150,000 in equity on a typical starter home. “We must focus on policies that address the root cause of the affordability crisis: inadequate housing supply,” stated Shannon McGahn, NAR’s executive vice president and chief advocacy officer.
Several factors contribute to this crisis, including soaring rental prices and massive student loan debt, making it increasingly challenging for young adults to save for down payments. The median down payment has now risen to 19%, the highest level in decades.
All-cash purchases have also reached unprecedented heights, averaging 26% over the past year, showing a trend favoring repeat buyers who can leverage equity from previous sales to navigate high mortgage rates. For first-time buyers, personal savings remain the most common source of down payment funds, with 59% relying solely on savings. Notably, over 20% received financial assistance from family or friends.
Further complicating the picture, the share of buyers with children under 18 has plummeted to just 24%, a historic low compared to 58% in 1985.
This urgent report from NAR is based on survey data from transactions occurring between July 2024 and June 2025, painting a troubling picture for the future of homeownership in the U.S. As the housing market continues to evolve, the struggle for first-time buyers is far from over.
Stay tuned for more updates as this situation develops.
