The age of first-time homebuyers in the United States has reached a historic high, now averaging 38 years old. This shift highlights a significant delay in reaching the milestone of homeownership among Americans. In stark contrast to previous decades, only a third of U.S. citizens own a home by age 30, a significant drop from 47% in 1984. A recent study by John Burns Research and Consulting also indicates other notable life milestones happening later in life, such as living independently and marriage. Currently, only 70% of 30-year-olds live independently, a decrease from 83% in 1984, while just 48% have been married, down from 78% during the same period.
This trend in delayed homeownership has been evolving rapidly. Just a few years ago, in 2020, the average age of a first-time homebuyer was five years younger, at 33. Between 1993 and 2018, this age averaged around 31 years. Factors contributing to this shift include changing cultural norms, limited availability of housing, and the rising costs associated with buying a home. The escalation of home prices over recent years has notably accelerated the trend, with the median age of first-time buyers climbing significantly from 2020 to 2024.
The COVID-19 pandemic further exacerbated these challenges, with rising home prices and increased mortgage rates following the pandemic period. This situation has compounded the existing housing supply gap, which Realtor.com estimates at nearly 4 million homes nationwide. The limited supply has kept home prices high, leading many potential buyers to remain renters rather than enter the housing market. This cultural shift away from homeownership has contributed to the rise in the median age of first-time buyers.
As of 2024, the rental market reflects this change, with 72% of renters being 30 years or older, marking an all-time high. In 2020, this demographic accounted for less than 70% of renters. The National Association of Realtors’ “2024 Profile of Home Buyers and Sellers” reveals that first-time homebuyers comprised just 24% of the market last year, the lowest since data collection began in 1981. Concurrently, the median age of all homebuyers increased to 56, up from 49 the prior year.
The Societal Shift
This delay in homeownership has significant implications for both individuals and the broader housing market. For many, the prolonged reliance on rental properties may lead to increased financial strain, as renting often provides less financial stability and long-term investment potential than owning a home. The cultural shift towards later life milestones may also impact family planning and lifestyle decisions, as individuals prioritize financial security before committing to homeownership.
On a broader scale, the increasing age of first-time homebuyers signals potential challenges for the housing market. With fewer individuals entering the market, demand for rental properties may continue to rise, potentially driving up rental costs. The housing supply gap further complicates this issue, as insufficient new housing developments could exacerbate affordability challenges and limit access to homeownership for future generations. Addressing these issues will be crucial for ensuring that homeownership remains an achievable goal for a diverse range of U.S. citizens.