First-Time Buyers Fall to Record Low of 21% in NAR’s 2025 Report

First-time home buyers now make up just 21% of all home purchases, the lowest share ever recorded by the National Association of Realtors (NAR). 

And for the first time, the typical first-time buyer is 40 years old.

Those two numbers, from NAR’s 2025 Profile of Home Buyers and Sellers, tell the story of a housing market defined by scarcity, cost, and delay. 

The annual report, which covers transactions from July 2024 through June 2025, reveals a market where affordability barriers and aging demographics are reshaping the very definition of a “typical buyer.”

The median age of all buyers reached 59, up from 56 last year and 47 before the pandemic. The typical repeat buyer is now 62, while one in four buyers is between 65 and 74 years old.

Among first-time buyers, 32% are between 25 and 34, and 25% fall between 35 and 44. Homeownership is increasingly a milestone reached later in life.

A Market Without Its Entry Point

The share of first-time buyers has dropped by 50% since 2007, right before the Great Recession. The result is a generation that’s waiting longer than ever to buy and, as a consequence, losing years of potential equity growth.

Jessica Lautz, NAR’s deputy chief economist and vice president of research, put it plainly:

“The historically low share of first-time buyers underscores the real-world consequences of a housing market starved for affordable inventory. 

“The share of first-time buyers in the market has contracted by 50% since 2007, right before the Great Recession. 

“The implications for the housing market are staggering. Today’s first-time buyers are building less housing wealth and will likely have fewer moves over a lifetime as a result.”

Lautz’s point highlights more than just a generational challenge. With fewer new buyers entering the market, mobility slows across the board. 

Sellers are staying put longer, too. The median tenure in homes before selling is 11 years, the longest on record. That lack of turnover limits the supply of entry-level properties and keeps prices elevated in markets where first-time buyers are most active.

A Split Market of Haves and Have-Nots

The demographics behind today’s buyers tell a story of widening wealth and age gaps. 

Married couples still make up the majority at 61%, but that share continues to fall. Single female buyers rose slightly to 21%, single males to 9%, and unmarried couples held steady at 6%.

Among first-time buyers:

• 50% were married couples
• 25% were single females
• 11% were unmarried couples
• 10% were single males

First-time buyers are also more diverse than repeat buyers; 34% of first-time buyers identified as non-White or Hispanic, compared to 15% of repeat buyers. Among all buyers:

• 84% identified as White
• 7% identified as Hispanic or Latino
• 6% identified as Black or African-American
• 4% identified as Asian or Pacific Islander

The financial profiles of buyers reveal an equally stark contrast. Repeat buyers have a median age of 62, put down 23%, and pay all cash 30% of the time. 

First-time buyers, by comparison, make 10% down payments, the highest since 1989 (but still less than half what repeat buyers are putting down), and often rely on multiple sources to make it work:

• Personal savings (59%)
• Financial assets such as 401(k)s or crypto (26%)
• Gifts or loans from family and friends (22%)

Multigenerational living continues to play a role in affordability, though slightly fewer buyers took this route in 2025. Fourteen percent of buyers purchased multigenerational homes, down from 17% last year. The top reasons for buying them included:

• Caring for aging parents (41%)
• Saving on costs (29%)
• Adult children moving back home (27%)
• Spend more time with aging parents (23%)
• Grandchildren living in the home (12%)
• Reducing childcare costs (6%)

For repeat buyers, the financial landscape looks entirely different. 

• Half purchased newer homes after selling
• 34% bought larger homes

The data in NAR’s report highlights the widening gap between buyers who have built equity and those who haven’t. Lautz described it as “a tale of two cities”:

“We’re seeing buyers with significant housing equity making larger down payments and all-cash offers, while first-time buyers continue to struggle to enter the market.”

The median distance moved also shrank slightly to 30 miles, indicating most buyers are staying local rather than relocating to lower-cost regions.

Put all these numbers together, and it’s clear the “entry-level buyer” looks very different from its counterpart a few decades ago. The dream of buying a first home in one’s late twenties or early thirties is no longer the norm. It’s the exception. 

The Cost of Waiting

For many would-be buyers, waiting feels like the safest option in a high-rate environment. But as NAR’s report highlights, that delay comes with a long-term cost.

Shannon McGahn, NAR’s executive vice president and chief advocacy officer, explained the financial consequences clearly:

“For generations, access to homeownership has been the primary way Americans build wealth and the cornerstone of the American Dream. Delayed or denied homeownership until age 40 instead of 30 can mean losing roughly $150,000 in equity on a typical starter home.”

That $150,000 figure reframes the affordability discussion. It’s not just about higher home prices and mortgage rates. It’s about lost opportunities to build intergenerational wealth.

Income data also reveals who’s still able to buy. The median household income among all buyers rose slightly to $109,000, while:

• First-time buyers had a median income of $94,400
• Repeat buyers earned a median income of $111,700
• Married couples reported the highest household incomes
• Single female buyers had the lowest median income of all groups

Housing history also reveals a widening gap between generations.

• 65% of recent buyers owned their previous home
• 64% of first-time buyers rented before purchasing
• 22% lived with friends or family before buying

That last number has nearly doubled since the early 1990s, showing how often family support now bridges the gap to ownership.

When asked why they bought, buyers cited a mix of practical and emotional motivations:

• 21% said they wanted to own a home of their own (for first-time buyers that jumps to 64%)
• 16% wanted to be closer to friends or family
• 10% wanted a larger home

For first-time buyers, the dream of ownership still drives the decision, with 64% saying it was their main reason for buying.

The dream of homeownership is still very much alive, but it’s delayed and more dependent on existing wealth than ever before. With affordability tightening and inventory stagnant, younger and first-time buyers face the toughest path to entry in modern history.