Why Are People Buying Their First Home Later in Life?

Owning a home is a big part of what many Americans aim for. However, recent studies show that achieving this dream is happening much later than it used to. The average age of someone buying their first home has hit almost 40 years old, the highest it's been in decades.

The National Association of Realtors (NAR) recently revealed that the average age of all homebuyers is now 56, up by seven years. For those buying a home for the first time, the average age has increased to 38 from 35 just last year. This shift isn't too surprising for anyone who has been trying to buy a home lately.

Mortgage rates have shot up from about 3% to over 7% in just two years and haven't fallen much since. At the same time, the prices of homes across most cities in the country have gone up.

These changes have made buying a home much more expensive, especially for younger people or those trying to buy their first home. Jessica Lautz from the NAR notes that high prices, high-interest rates, and not enough homes for sale are the main problems first-time buyers are facing.

Check out: Top 5 Loan Options for First-Time Homebuyers in 2025

People who already own homes have it a bit easier since they can sell their current home and use the money to help buy a new one, either by trading up or downsizing.
 

A Growing Trend

The trend of people buying homes later in life isn't new. It has been gradually happening for the past 40 years. A lot of this change is due to social and economic reasons.

For instance, people are getting married later, spending more time in school, and starting their careers later. All these factors delay home buying.

Moreover, the current high costs related to buying a home, like bigger down payments and various fees, alongside the scarcity of affordable "starter" homes, have pushed even more potential buyers to wait.

The survey revealed that 77% of younger adults consider the lack of affordable homes in their desired area a major obstacle to buying a home.

Other reasons include homeowners not moving as much as they used to and older Americans choosing not to downsize due to high-interest rates, which make even smaller homes more expensive in the long run.

All these factors combined mean it's tougher for someone without the advantage of selling a previous property to afford buying a home.

Max Koziol from Chase Home Lending mentioned that it now takes longer for younger people to save up for the initial costs of buying a home. This delay contributes to the rise in the average age of homebuyers.

Despite these hurdles, the desire to own a home remains strong among Americans, and the dream of homeownership is still alive.

However, with the current challenges, it looks like the trend of buying a home later in life will continue for some time.

Read more: Can You Buy a House Without Putting Any Money Down?

Not being able to afford a home isn't all bad. There are many advantages to renting, whether it's a condo, apartment, or an entire house. However, while renting does incur costs, they are generally lower than the expenses associated with buying a home. 

Find programs that help with rent by signing up here