The average age of homebuyers in the United States has risen to 56 years old, up from 49, compared to last year.
According to an annual report by the National Association of Realtors, the profile of a first time homebuyer in the United States is an older, single woman who doesn't have children.
Women made up 20 percent of transactions compared to 80 percent of men. By race, white buyers made up 83 percent of purchases, Black buyers six percent, Hispanics four percent, and Asians four percent.
While the new data reflects a growing trend of older individuals buying real estate, it also signifies that younger Americans such as millennials and Gen Z are being priced out of the homebuying process and cannot afford a home, reported CNBC.
The shift is driven by rising homeownership costs, making it increasingly difficult for younger buyers to enter the market, said the report.
The median home price has surged 39 percent since 2020, reaching $435,000, while mortgage rates have more than doubled. Depending on the state, a starter home can sale for more than $1 million.
As a result, the percentage of first-time buyers has dropped from 32 to 24, the lowest since 1981 said CNBC.
Despite the U.S. Department of Housing and Urban Development (HUD) providing grants and loan options for buying a home, younger buyers face significant hurdles to homeownership: High down payments, student debt, and stiff competition from wealthier, all-cash buyers stateside and overseas.
Many buyers are uninformed about mortgage assistance programs and grants for down payments that are available by state, county, and city municipalities, oftentimes relying on financial assistance from family members for down payments.
Experts argued that rising home prices and the hidden costs of homeownership have made it nearly unattainable for younger generations who aren't employed at high paying jobs or have access to existing wealth.
The market is dominated by buyers who tend to buy multiple homes, with many using home equity to make large down payments or buys.
According to analysts, housing affordability in the U.S. won't improve until 2026 as rates and prices remain too high. Home prices are expected to rise by 4.5 percent this year, five percent in 2025, and 0.5 percent in 2026.
