First-time homebuyers are older than ever as housing affordability tightens

The path to homeownership in the United States is taking longer than ever, with first-time buyers now reaching a record-high median age. According to the National Association of Realtors’ 2025 Profile of Home Buyers and Sellers, the median age of a first-time homebuyer has climbed to 40, reflecting intensifying affordability pressures across the housing market.

Housing analysts say the shift underscores how rising home prices, limited supply, and higher borrowing costs are fundamentally altering when and how Americans can buy their first home.

A Historic Shift in Buyer Age

The NAR’s latest report, which analyzes home purchases made between mid-2024 and mid-2025, shows the median age for first-time buyers increased sharply from prior years, reaching the highest level on record. Two decades ago, first-time buyers were typically in their late 20s.

According to Realtor.com, the increase reflects a combination of higher mortgage rates, elevated home prices, and slower wage growth relative to housing costs, particularly in coastal and high-demand markets. The report also notes that first-time buyers accounted for just 21% of all home purchases, another historic low that highlights growing barriers to entry (NAR, 2025).

Affordability and Supply Constraints

Federal housing data shows that housing costs continue to outpace income growth. According to the U.S. Census Bureau, median home values rose significantly between 2019 and 2024, while household incomes failed to keep pace in many regions. At the same time, the U.S. Department of Housing and Urban Development has repeatedly cited underbuilding as a core driver of affordability challenges, warning that insufficient housing supply is keeping prices elevated nationwide.

Major news outlets, including The Wall Street Journal, have reported that builders have largely moved away from smaller, entry-level homes in favor of higher-priced developments, further limiting options for first-time buyers.

Market-Wide Impacts

Housing economists say the aging first-time buyer is reshaping the broader housing ecosystem. According to The New York Times, delayed homeownership can slow household formation, extend rental demand, and reduce mobility — particularly for younger adults and growing families.

Older first-time buyers are also more likely to seek properties that offer flexibility, such as multigenerational layouts or rental potential. Analysts cited by CalMatters note that this has increased interest in homes that can support accessory dwelling units (ADUs) or secondary living spaces, especially in high-cost states like California.

Why This Matters

The rising age of first-time buyers signals that affordability challenges are becoming structural rather than temporary. According to GoBankingRates (2025), delayed homeownership can affect long-term wealth accumulation, retirement planning, and housing stability for middle-income households.

State housing agencies have echoed these concerns. The California Department of Housing and Community Development estimates the state needs roughly 180,000 new homes per year to meet demand — a target it has consistently missed.

Quick Tip: If you’re entering homeownership later in life, consider housing options that offer built-in flexibility, such as properties that allow ADUs or rental units, which can help offset ownership costs and adapt to changing household needs.

Xavier Rodriguez is the CEO of ADU Geeks, San Diego’s leading ADU consulting and project management firm. In 2024, the company was ranked No. 1 on the San Diego Business Journal’s Fastest Growing Private Companies list in the Small Business category, achieving 594.3% revenue growth.