As Housing Costs Rise and Starter Homes Disappear, First-Time Buyers Face a Dire Dilemma
Tue, 01/24/2023 – 11:54
Unforgiving market conditions mean that today’s first-time homebuyers are older and more financially burdened than new buyers in years past
Surging mortgage rates coupled with persistent home price gains have created a series of unprecedented hurdles for today’s homebuyers, and according to Insider, first-timers are faring the worst. New buyers looking for affordable starter homes are finding a bleak supply of for-sale properties, and even those still available on the market are becoming too pricey for young house hunters to afford.
As a result, the first-time buyer profile is changing. Between June 2021 and June 2022, the typical first-time homebuyer was 36 years old, the highest median age recorded since the National Association of Realtors began surveying buyers in 1981, when homebuying newbies accounted for just 26% of all home purchases.
The profile of the typical first-time homebuyer has dramatically shifted over the past few decades — and even more so in the years since the housing-market meltdown in 2008. The most recent NAR data indicates the new face of first-time homeownership is older, richer, more likely to be unmarried, and more likely to be moving right from their parents’ home.
Perhaps the most striking shift is the age of new homebuyers. The median age of someone purchasing their first home in 1981 was 29. Over the next 30 years that figure barely creeped up, rising to just 30 in 2010. But in the past decade, the median age has ticked up even higher, reaching a record of 36 last year.