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The share of homes bought by first-time buyers fell to a record low in 2024, with first-timers picking up just 24 percent of homes sold, according to a new report from the National Association of Realtors.
That was down from 32 percent in 2023, as high home prices paired with high interest rates to create a force that kept first-time homebuyers out of the market, the report, known as the Profile of Home Buyers and Sellers, said.
“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’s deputy chief economist. “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.”
The report comes from an annual survey conducted by NAR between July 2023 and June 2024.
It found that buyers need to make more money than ever to afford to buy, and even then, they’re struggling to put more money down.
First-time homebuyers put down 9 percent for a down payment, whereas the median for all buyers was 18 percent, according to the report.
The age of buyers rose across all spectrums. Homebuyers’ ages rose to 56 years, up from 49 last year. For first-timers, the average age was 38 years old, up from 35 last year.
More buyers than ever bought what NAR called a “multigenerational home,” which typically includes more than one unit. That helps to share costs with others living in the home and provides space for older children or aging relatives to live in the home.
That may have been helped both by the affordability crunch and by a policy change by Fannie Mae, which lowered the minimum down payment required for buyers getting into a two- to four-unit property, to as little as 5 percent.
“As homebuyers encounter an unaffordable housing market, many are choosing to double up as families,” Lautz said. “Cost savings are a major factor, with young adults returning home — or never leaving — due to prohibitive rental and home prices.”
The 127-question survey was sent to 167,750 recent primary residence homebuyers based on geography and representative of sales. It received 5,390 responses.
Eighty-three percent of buyers were white, 7 percent were Black, 6 percent were Hispanic, 4 percent were Asian and 3 percent were some other ethnicity, the survey found.
