First-Time Home Buyers Shrink to Historic Low of 24% as Buyer Age Hits Record High
WASHINGTON, Nov. 04, 2024 (GLOBE NEWSWIRE) -- Key Highlights
- A record high 26% of buyers paid cash for their homes.
- Seventeen percent of home buyers purchased a multigenerational home, the highest share ever recorded.
- The median down payment was 18% among all home buyers and 9% for first-time buyers.
The first-time homebuyer market share decreased to a historic low of 24% (down from 32% last year), while home buyers’ ages hit all-time highs of 56 years overall (49 last year), 38 years for first-time buyers (35 last year) and 61 years for repeat buyers (58 last year), according to the National Association of Realtors®’ 2024 Profile of Home Buyers and Sellers[1]. This annual survey of recent home buyers and sellers – this year tracking transactions between July 2023 and June 2024 – has been NAR’s flagship report since it first published in 1981, providing industry professionals insight into detailed homebuying and selling behavior.
“The U.S. housing market is split into two groups: first-time buyers struggling to enter the market and current homeowners buying with cash,” said Jessica Lautz, NAR deputy chief economist and vice president of research. “First-time buyers face high home prices, high mortgage interest rates and limited inventory, making them a decade older with significantly higher incomes than previous generations of buyers. Meanwhile, current homeowners can more easily make housing trades using built-up housing equity for cash purchases or large down payments on dream homes.”
The typical home buyer’s median household income for 2023 rose to $108,800 from $107,000 in 2022. First-time buyers had a median household income of $97,000, up from $95,900 the prior year and an increase of $26,000 in the last two years. Repeat buyers had a median household income of $114,300, up from $111,700 the previous year.
The share of married couples increased to 62% of all buyers, with single female buyers seeing a slight rise to 20%. Conversely, the share of single males decreased to 8% and unmarried couples dropped to 6%. In addition, the share of single female first-time buyers jumped by 5%.
Eighty-three percent of recent home buyers identified their ethnicity as White or Caucasian. Seven percent of recent buyers identified as Black/African American, 6% identified as Hispanic/Latino, 4% identified as Asian/Pacific Islander and 3% as some other ethnicity.
Seventy-three percent of recent home buyers did not have a child under the age of 18 in their home – the highest share recorded.
Seventeen percent of home buyers purchased a multigenerational home, the highest share in the data series. The top reasons cited were cost savings (36%), to take care of aging parents (25%), children over the age of 18 moving back home (21%), and children over the age of 18 who never left home (20%).
“As home buyers encounter an unaffordable housing market, many are choosing to double up as families,” explains Lautz. “Cost savings are a major factor, with young adults returning home – or never leaving – due to prohibitive rental and home prices. Meanwhile, elderly parents and relatives are moving in with family members as home buyers reprioritize what matters most to them.”
Real estate agents played a crucial role in the homebuying process, with 86% of all buyers utilizing their services – the highest of all information sources used. Agents were the most useful information source in the home search process.
Eighty-eight percent of home purchases were made through a real estate agent or broker, demonstrating the continued importance of agents in the homebuying process. Nearly 90% of buyers each expressed satisfaction with their agent’s responsiveness, knowledge of the purchase process, honesty and integrity, knowledge of the real estate market and people skills. Eighty-eight percent of home buyers would use their agent again or recommend to others.
In 2024, the median down payments were 18% for all home buyers, 9% for first-time home buyers and 23% for repeat home buyers – the highest down payments for first-time home buyers since 1997 and repeat home buyers since 2003. First-time buyers continue to rely on savings (69%); however, 25% used loans or gifts from friends and family, 21% used financial assets and an all-time high of 7% used inheritances. A record 26% of home buyers paid cash for their homes.
The typical age of home sellers reached 63 years, the highest ever recorded. The share of married couples selling their homes was 69%, an increase from 65% last year, marking the first increase in four years.
For sellers, the most cited reason for selling their home was the desire to move closer to friends and family (23%), followed by home was too small (12%), home was too large (11%) and neighborhood becoming less desirable (10%).
“Family support systems are influencing buying and selling decisions,” said Lautz. “Being close to friends and family is the top reason to sell, while buying a home convenient to friends and family continues to grow in importance. Today’s buyers are less likely to be concerned with their work locations when purchasing, perhaps because of a higher share of older repeat buyers and remote work flexibility remaining a factor.”
Ninety percent of sellers sold with the assistance of a real estate agent, up from 89% last year, and only 6% were for-sale-by-owner sales, an all-time low. Most sellers (87%) said that they would definitely (72%) or probably (15%) recommend their agent for future services.
“Most home buyers and sellers find it valuable to use an agent who is a Realtor® to help them maneuver through the complicated homebuying and selling processes, especially in a challenging housing market,” said NAR President Kevin Sears, broker-associate of Sears Real Estate/Lamacchia Realty in Springfield, Massachusetts. “Realtors® provide critical knowledge and expertise that ensure a successful transaction.”
Methodology
Data gathered in the report is based on primary residence home buyers. In July 2024, NAR mailed out a 127-question survey using a random sample weighted to be representative of sales on a geographic basis to 167,750 recent home buyers. The buyers must have purchased a primary residence home between July 2023 and June 2024. NAR received 5,390 responses from primary residence buyers. After accounting for undeliverable questionnaires, the survey had an adjusted response rate of 3.2%. Per the REALTORS® Confidence Index, 83% of home buyers were primary residence buyers in 2023, which accounts for 4,756,000 homes sold in 2023 (among new and existing homes). Using that calculation, the sample at the 95% confidence level has a confidence interval of plus-or-minus 1%.
About the National Association of Realtors®
The National Association of Realtors® is America’s largest trade association, representing 1.5 million members involved in all aspects of the residential and commercial real estate industries. The term Realtor® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics. For free consumer guides about navigating the homebuying and selling transaction processes – from written buyer agreements to negotiating compensation – visit facts.realtor.
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Information about NAR is available at nar.realtor. This and other news releases are posted in the newsroom at nar.realtor/newsroom. Statistical data in this release, as well as other tables and surveys, are posted in the “Research and Statistics” tab.
[1]The 2024 edition of NAR’s Profile of Home Buyers and Sellers continues the longest-running series of national housing data evaluating the demographics, preferences and experiences of recent buyers and sellers. Results are representative of owner-occupants and do not include investors or vacation homes.
Lauren Cozzi National Association of REALTORS® 202/383-1178 LCozzi@nar.realtor
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