First-time buyers represented only 24% of all home buyers during the 12 months ended in June, down from 32% in the previous 12-month period, as the average age of a home buyer increased to 56, according to the National Association of Realtors (NAR).
In addition, a record 26% of buyers paid cash for their homes.
According to NAR’s data, the average age of a first-time home buyer increased to 38 (up from 35 last year). The average age of a repeat home buyer was 58.
Meanwhile, the average annual salary for a typical home buyer increased to $108,800. The average salary for a first-time home buyer increased to $97,000, while the average salary for a repeat buyer increased to $114,300.
“The U.S. housing market is split into two groups: first-time buyers struggling to enter the market and current homeowners buying with cash,” explains Jessica Lautz, deputy chief economist and vice president of research for NAR, in a statement. “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.”
Seventeen percent of home buyers purchased a multigenerational home, the highest share ever recorded.
“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.
“Family support systems are influencing buying and selling decisions,” adds 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.”
The median down payment was 18% among all home buyers and 9% for first-time buyers.
Photo: Roberto Nickson