Owning a home is a big dream for many people in America. However, this dream is taking a little longer to come true for a lot of folks.
A new report by the National Association of Realtors (NAR) reveals that the average age of people buying homes for the first time has hit nearly 40 years old. This is a significant rise from the past.
The overall median age of all homebuyers is now 56, which is the oldest it's been in the 43 years NAR has kept track of this data. People buying homes again are around 61 years old on average, up from 58.
Homes are more expensive, and getting a mortgage is not as cheap as it once was. Interest rates for home loans have more than doubled in the past two years, making monthly payments higher. These factors make it tough for younger people or those trying to buy a home for the first time.
Jessica Lautz, a top economist at NAR, says that first-time buyers are especially hit hard by steep home prices, high mortgage rates, and not enough homes for sale.
People who already own homes have it a bit easier because they can use the value they've built up in their current homes to help buy another one.
Why Are Homebuyers Getting Older?
This trend of older homebuyers isn't just happening because of the current state of the economy. It's part of a long-term shift that's been ongoing for decades. People are choosing to get married later, spend more time in education, and start their careers later, which delays home buying.
The recent spike in home prices and the cost of getting a mortgage have made it even harder for people to buy homes early. The high prices, combined with the lack of affordable starter homes, force many to delay their home-buying plans.
A survey found that 77% of adults under 40 say there aren't enough affordable homes available where they want to live.
Another reason for the shortage of homes for sale is that people are choosing to stay in their current homes longer, either by expanding or improving them, instead of moving.
Plus, higher interest rates mean that even if smaller homes are cheaper, the monthly payments might not be, making it tough for older Americans to downsize.
Check out: Top 5 Loan Options for First-Time Homebuyers in 2025
What Does This Mean For Future Homebuyers?
All these challenges make it harder for new buyers without existing home equity to enter the market. It's taking them longer to save for the upfront costs of buying a home, thus raising the average age of homebuyers.
Despite these obstacles, the desire to own a home remains strong. But solving the issues that make it tough for younger buyers will take time, which means the average age of homebuyers may keep rising for a while.
Read more: Can You Buy a House Without Putting Any Money Down?
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