The National Association of Realtors released its Profile of Home Buyers and Sellers Thursday, and the findings will make a splash. It’s not hard to understand why; the survey revealed first-time buyers made up 22 percent of home purchases, up slightly from last year’s all-time low of 21 percent. But this is still far below the historical norm of 40 percent seen before 2008.
Normally, discussions about this research would be a positive thing. However, critics have suggested that the survey must be missing first-time buyers. They’re wrong; NAR’s survey findings are consistent with a broader picture showing that homeownership has become increasingly difficult for younger households.
Unfortunately, the risk of focusing too heavily on this aspect of the debate is that it distracts from the more pressing issue: the growing barriers to first-time homeownership and the need for meaningful solutions.
When NAR’s findings are examined alongside Census Bureau data and other national surveys, it’s clear that NAR’s survey is not an outlier. In fact, the strongest evidence comes from sources entirely outside NAR.
First-time homebuyer data
According to the Census Bureau’s Housing Vacancies and Homeownership Survey, the homeownership rate for Americans under the age of 35 has now declined for four consecutive years, reaching 37 percent. Meanwhile, homeownership rates for Americans over age 50 remain above 70 percent.
The divide between younger households attempting to enter homeownership and older homeowners who have accumulated housing equity continues to widen.
The Census’s American Community Survey tells a similar story. According to NAR calculations of the data, between 2021 and 2024, the number of households aged 25 to 34 grew by more than 700,000. Yet the number of homeowners in that age group increased by only about 65,000. The homeownership rate for this age group fell from 41.6 percent to 40.4 percent, while the share who recently moved into owner-occupied housing dropped by nearly one-third.
If fewer young households are becoming homeowners, it follows that first-time buyers would make up a smaller share of home purchases. That is exactly what NAR’s survey measures.
Importantly, NAR’s definition of a first-time buyer is straightforward and has not changed in decades. Homebuyers are simply asked, “Was this your first home purchase?” Those who answer yes are classified as first-time buyers.
Maintaining that consistent definition is critical because it allows for meaningful comparisons across time. It provides an important perspective on how the path to homeownership has evolved and the challenges of today.
Another important distinction is that NAR’s survey captures all buyers, regardless of whether they finance their purchase. This matters because today’s market increasingly includes buyers who enter homeownership through accumulated wealth rather than through a mortgage.
The latest survey found that 10 percent of first-time buyers paid entirely with cash, the highest share ever recorded. These buyers look very different from traditional first-time buyers. Their median age was 54, compared with 38 among first-time buyers who financed their purchase. They are also more likely to rely on inheritance, gifts or other wealth transfers to enter the housing market.
At the same time, first-time buyers who rely on financing continue to face substantial affordability barriers. Overall, the median age of first-time buyers remains at a record high of 40 years old. In previous decades, first-time buyers were typically in their late 20s.
The challenges facing younger households are also evident in living arrangements. The Census’s Current Population Survey data show that 16.4 percent of adults ages 25 to 34 lived with family in 2025, compared with only 9 percent in 1980. NAR’s survey similarly finds that 21 percent of first-time buyers lived with family before purchasing their home, nearly double the share reported in the early 1990s.
The story the data is telling
Viewed together, these trends tell a consistent story: Homeownership is being delayed. Young households continue to want to own a home, but many struggle to save for a down payment, find affordable inventory or qualify for a monthly payment that fits within their budget.
For that reason, the decline in first-time buyers should not be viewed as a debate over research methodologies. It is a market reality, and it needs to be approached as such. That means taking steps to increase supply, such as modernizing the outdated capital gains exclusion, streamlining regulations, and encouraging state and local zoning changes. These are essential to expanding opportunities for future generations of homebuyers.
When Census homeownership rates, household formation data, living arrangement trends and NAR’s consumer survey all point in the same direction, confidence in the findings increases. The data sources are different, the methodologies are different, yet the conclusion remains the same: Fewer young households are successfully transitioning into homeownership.
The story is not that first-time buyers have disappeared from the data. It’s that they are increasingly missing from the housing market itself. Instead of discounting these very real circumstances, we need to be talking about solutions. That’s the important conversation that deserves our time and focus.
Jessica Lautz is the Deputy Chief Economist and Vice President of Research for the National Association of Realtors in Washington, D.C. Get connected on LinkedIn.
