The average age of first-time homebuyers is rising. According to a report released by the National Association of Realtors (NAR), for the first time in history, the average age of American first-time homebuyers is 36 years old.
At the same time, young buyer participation is at a historic low. Only 26% of the total number of buyers registered between July 2021 and June 2022 decided to purchase their first home. This is quite a drop compared to the 34% of first-time buyers recorded last year.
What problems do young buyers have?
The data highlighted in the report is not surprising, but it does represent a problem for young buyers looking to purchase their first home. NAR's Vice President of Demographics and Behavioral Insights, Jessica Lautz, told The Hill:
We also know that first time homebuyers have to save for a down payment and closing costs in an environment of high inflation with rising rents while still having student loan debt and being able to pay that down as well as credit card costs or childcare expenses. All of that does add up. And so, saving for a down payment ends up on the back burner because you have to pay the bills that are due first before you can save.
According to The Hill, 26% of first-time homebuyers say that their main difficulty when buying a home is saving the money needed to buy it. Furthermore, many of them say they have to make sacrifices to save money by cutting back on entertainment expenses.
This may be one of the reasons that explains another one of the results released in the report: 88% of the houses purchased are second-hand, while only 12% are newly built.
