The share of first-time homebuyers is fewer and older than ever before, according to a new report from the National Association of Realtors.
Just 26 percent of U.S. homebuyers in the last year were first-time buyers, that’s down from 34 percent in 2021 and the lowest since NAR began tracking the data. In 2010, 50 percent of homebuyers were first timers, buoyed by the federal First-Time Home Buyer Tax Credit, according to NAR.
The average age of first-time homebuyers in the last year was 36, which is an all-time high and up from an average age of 33 a year ago, according to NAR. The typical repeat homebuyer’s age climbed from 56 years in 2021 to 59 years this year, also the highest since the data has been tracked.
“It’s not surprising that the share of first-time buyers shrank to the lowest level ever recorded given the housing market’s combination of historically low inventory, persistently high home prices and rapidly escalating interest rates,” Jessica Lautz, NAR vice president of demographics and behavioral insights, said in a written statement. “Those who have housing equity hold the cards and they’ve fared very well in the current real estate market. First-time buyers are older as a result of saving for down payments for longer periods of time or relying on a generational transfer of wealth to propel them into homeownership.”
The report also found that people are staying in their homes longer. The median expected home tenure for first-time buyers was 18 years, the highest ever recorded and up from 10 years in 2021.
Released Thursday, NAR’s 2022 Profile of Home Buyers and Sellers also found that the median distance buyers moved from their previous homes more than tripled from the distance registered the previous four years as the shares of homes purchased in small towns and rural areas reached record highs.
The median distance between the home that recent buyers purchased and the home from which they moved was 50 miles, that’s more than a three-fold jump from the median of 15 miles from 2018 through 2021. The shares of homes purchased in small towns was 29 percent and rural areas was 19 percent in the last year, both all-time highs.
“Family support systems still prevailed as a motivating factor when moving and in neighborhood choice,” Lautz said. “For others, housing affordability was a driving factor to seek homes in areas farther away. For many, remote work decisions were formalized in the last year, providing clarity for employees to permanently move to more distant areas.”
White Americans accounted for 88 percent of all buyers, followed by Hispanic Americans at 8 percent, Black Americans at 3 percent, and Asian Americans at 2 percent, according to NAR. The shares for White and Hispanic Americans increased from a year ago, 82 percent and 7 percent, respectively, while the shares of Black and Asian American buyers declined, both down from 6 percent.
The median number of weeks that buyers searched for a home was 10, an increase from eight weeks in 2020 and 2021 and homebuyers typically purchased their homes for 100 percent of the asking price, with 28 percent purchasing for more than asking price, according to the NAR report.