First-Time Homebuyers Hit All-Time Low

The share of first-time buyers in the U.S. housing market fell to 21 percent last year, according to the latest data by the National Association of Realtors (NAR), a drop of 3 percent from a year earlier and the lowest rate since at least 1981.

As further proof that young people are having a particularly hard time breaking into homeownership, the median age of first-time buyers reached an all-time high last year, inching up to 40.

It likely has to do with the fact that home prices, after rising by nearly 50 percent between 2019 and 2024, are still rising, albeit at a slower pace. Mortgage rates are playing a role as well. After roughly doubling between 2019 and 2022, they are still historically high, hovering just below 6.5 percent.

But the biggest obstacle for first-time buyers is possibly the upfront payment required to purchase a home. The average down payment for first-time buyers is now 10 percent of the full purchase price, according to NAR data-an all-time high since 1989.

Baby Boomers Continue Dominating the Market

Baby boomers, flush with record-high home equity, continue to dominate the U.S. housing market, accounting for 42 percent of homebuyers and 52 percent of sellers, according to NAR data.

"The housing market remains sharply divided between homeowners with equity and first-time buyers trying to break in-many of whom are younger millennials," NAR Deputy Chief Economist Dr. Jessica Lautz said in a statement. "For many younger households, affordability challenges and limited inventory are still making homeownership difficult to achieve."

Despite their dominance, things are bad for baby boomers-and for repeat buyers in general as well. The median age for this category has risen to 62, while their down payment has reached 23 percent, an all-time high since 2003.

But while no one is spared the impact of the housing affordability crisis, first-time buyers cannot count on having built any equity and typically have less savings than their older peers.

Many of them, the youngest millennials and older Gen Zers, are also now approaching the cutoff age to maximize their net worth, according to a recent study by Realtor.com that found that those who purchase their first home by age 32 clock a 22.5 percent higher net worth by age 50 compared with those who wait to buy in their 40s.

Americans Are Disheartened-With Good Reason

While homeownership still remains a dream for millions of Americans, many have stopped believing it is an affordable goal. According to a recent survey by The Harris Poll, nearly seven in 10 Americans believe a six-figure income is now required just to enter the housing market, and seven in 10 say homeownership feels more like a privilege than a goal.

"The housing market isn't just failing buyers. It's reshaping how Americans see their own futures," Libby Rodney, Chief Strategy Officer at The Harris Poll, said in a statement.

"Nearly half of Americans say housing costs are putting their lives on pause. That's not a market statistic-that's a generation of people delaying milestones, rethinking careers, and redefining what success looks like. The freeze isn't just economic. It's existential."

Newsweek's reporters and editors used Martyn, our Al assistant, to help produce this story. Learn more about Martyn.

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This story was originally published April 16, 2026 at 11:54 AM.