Key Details:
- Opendoor has released the third edition of its First-Time Homebuyer Report, offering real estate agents a detailed glimpse into the realities faced by today’s first-time buyers, including co-buying trends and home tour burnout.
More than three-quarters of today’s first-time homebuyers are making their first home purchase with a co-buyer. And about a third are co-buying with a parent, friend, or sibling.
That’s according to Opendoor’s third edition of its First-Time Homebuyer Report, released on March 5, 2024. Thanks to ongoing challenges with housing affordability, co-buying has become fairly common among first-time homebuyers.
First-time buyers are purchasing homes—
- With a spouse/partner: 61%
- On their own: 23%
- With parents: 16%
- With friends: 11%
- With siblings: 7%
First-time buyers who were co-buying with friends tended to tour 20-plus homes (45%) and to argue with their co-buyer about what home to buy (49%).
2023 brought a 35% increase in the number of first-time buyers purchasing a home on their own, but the co-buying trend is growing. More than one in ten first-time homebuyers co-purchased a home with a friend (11%). And the majority of these were men (62%).
Read on for more.
Hurdles and delays for prospective first-time buyers in 2023
Financial hurdles are the main reason co-buying has gotten more popular among first-time homebuyers, and they continue to steer buyer decisions.
When it came to delaying a home purchase, money (or the lack thereof) was most often the reason, as 53% put off a home purchase for financial reasons:
- 42% weren’t financially ready
- 32% were waiting for a drop in mortgage rates
Family and friends also played a role in delaying home purchases, with 22% of first-time buyers putting their plans on hold for family-related reasons and 18% holding off because of their relationship status.
Pressure and compromises for first-time buyers in 2023
Nearly nine out of ten first-time buyers (88%) are making compromises with their home purchasing decisions. Most often those compromises involve money, with 43% of respondents saying they paid more for their home than they wanted.
Home purchases came with revised expectations for many first-time homebuyers:
- 32% didn’t buy in the area they wanted
- 28% didn’t get all the home features they were hoping for
- 22% bought a smaller home than they originally wanted
Nine out of 10 first-time buyers felt pushed into moving quickly with a home purchase due to fear of missing out (FOMO), with 42% feeling that pressure internally, 24% feeling rushed by their agent, and 21% feeling under pressure from their co-buyer.
Among those who made their first home purchase in 2023, nearly a third (31%) believe they could have found an even better place if they’d kept looking—the same percentage as in 2022.
Sixty-five percent questioned whether it was all worth it, while 27% were just relieved when the whole process was over.
House tour burnout is real
Home tours can be a big help when shopping for a new home. But too many tours can lead to burnout and decision paralysis.
On average, first-time homebuyers in 2023 toured 23 homes—virtually or in person—which is close to the 24 homes toured the previous year.
Gen Z stood out from the pack by touring an average of 32 homes in 2023—45% more than Millennials, who toured an average of 22 homes, and 60% more than Gen X (20 homes).
First-time homebuyers’ main motivators
Based on Opendoor’s survey, first-time homebuyers are driven primarily by these four things:
- Stability and peace of mind from owning rather than renting (44%)
- More space (43%)
- Investment opportunities (41%)
- Starting a family (23%)
All the above is worth keeping in mind when you’re working with first-time homebuyers. To learn more, read Opendoor’s full downloadable report.
