| The NAR 2025 Buyer & Seller Trends report shows first-time buyers dropped to a record low of 21%, with the median age rising to 40. |
| Overview ● The share of first-time home buyers dropped to 21%, down from 24% last year. ● This marks the lowest share since 1981, when NAR began tracking the data. ● Historically, before the Great Recession, first-time buyers represented about 40% of the market. ● The median age of first-time buyers increased to 40, up from 38 last year. ● The median age of all buyers is now 59, while repeat buyers have a median age of 62. ● Among first-time buyers: ○ 32% were between 25 and 34 years old ○ 25% were between 35 and 44 years old Demographics and Household Composition ● Married couples: 50% of first-time buyers (unchanged from last year). ● Single females: 25% of first-time buyers. ● Unmarried couples: 11% of first-time buyers. ● Single males: 10% of first-time buyers. ● Ethnic diversity: ○ 34% of first-time buyers identified as non-White or Hispanic. ○ 15% of repeat buyers identified as non-White or Hispanic. ○ Among all buyers: 84% White, 7% Hispanic/Latino, 6% Black/African-American, 4% Asian/Pacific Islander, 3% other. ● Family composition: ○ 32% of first-time buyers had children under 18 living at home. ○ 22% of repeat buyers had children under 18 living at home○ 24% of all buyers had children under 18, a historic low. Income, Education, and Employment ● Median household income for first-time buyers: $94,400, down from $97,000 last year. ● Median household income for repeat buyers: $111,700. ● Median income for all buyers: $109,000. ● Married couples had the highest household incomes. ● Single female buyers had the lowest median incomes of all household types. ● Among all buyers: ○ 26% held a bachelor’s degree. ○ 25% held a master’s, law, or MBA-level degree. ○ 19% had a high school diploma but no college ○ 18% lived in a household with a veteran. ○ 1% included an active-duty service member. Financing and Down Payments ● Median down payment for first-time buyers: 10%, the highest since 1989. ● Median down payment for repeat buyers: 23%. ● 30% of repeat buyers purchased with all cash. ● Top funding sources for first-time buyer down payments: ○ Personal savings: 59% ○ Financial assets (401k, stocks, crypto): 26% ○ Gifts or loans from family or friends: 22% Housing and Living Arrangements ● 64% of first-time buyers rented their previous home or apartment. ● 22% lived with friends or family before buying. ● 65% of all buyers owned their previous home. ● 14% of all buyers purchased multigenerational homes, down from 17% in 2024. ● Top reasons for buying a multigenerational home: ○ Caring for aging parents: 41% ○ Cost savings: 29% ○ Adult children moving back home: 27% ○ Grandchildren living in the home: 12% ○ Reducing childcare costs: 6% Motivations for Buying ● 21% of all buyers said the desire to own a home of their own was their main reason for purchasing. ● Among first-time buyers, that number rose to 64%. ● 45% of all buyers said the timing was right and they were ready to purchase. ● 20% said they had little choice and needed to buy when they did. ● 16% wanted to be closer to friends or family. ● 10% wanted a larger home. Jessica Lautz, NAR Deputy Chief Economist: “The historically low share of first-time buyers underscores the real-world consequences of a housing market starved for affordable inventory. The share of first-time buyers in the market has contracted by 50% since 2007, right before the Great Recession. The implications for the housing market are staggering. Today’s first-time buyers are building less housing wealth and will likely have fewer moves over a lifetime as a result.” “Unfolding in the housing market is a tale of two cities. We’re seeing buyers with significant housing equity making larger down payments and all-cash offers, while first-time buyers continue to struggle to enter the market.” Shannon McGahn, NAR Executive Vice President: “For generations, access to homeownership has been the primary way Americans build wealth and the cornerstone of the American Dream. Delayed or denied homeownership until age 40 instead of 30 can mean losing roughly $150,000 in equity on a typical starter home.” |
