In recent years, elevated home prices and high interest rates have spotlighted the barriers young adults face to becoming homeowners. One figure in particular has dominated headlines this year: The median age of a first-time homebuyer (FTHB) is now 40, according to the National Association of Realtors.
But estimates for the median FTHB age vary by organization and methodology. Further, this number doesn’t fully capture the growing challenges young adults face in becoming homeowners.
Here, we look beyond the median age and find that a meaningfully smaller pool of young adults are becoming homeowners. And those who do buy a home are likely to have greater financial resources than their peers.
Focusing on the median FTHB age can mask affordability challenges
Despite methodological differences, most estimates place the median FTHB age from 32 to 35, with little change over the past decade.
The gap between the National Association of Realtors’ survey-based estimate and estimates drawn from administrative mortgage and credit records likely reflects differences in how the data are collected and how representative each sample is.
But just because the median age has remained stable doesn't mean the homebuying affordability challenges young adults face are overstated. That’s because median age doesn’t capture how many young adults are actually buying homes.
Consider two hypothetical years. In the first year, five people purchase homes. Their ages are 20, 25, 33, 40, and 45, for a median age of 33. In the second year, only three people purchase homes, ages 25, 32, and 38, for a median age of 32. The median age in the first year and the second year is nearly identical, but the second year saw 40 percent fewer buyers.
In other words, a stable median can mask the fact that fewer young adults are becoming homeowners.
Fewer young adults can afford to buy a home
To understand how many young adults are buying homes, we analyzed American Community Survey data on young adults (ages 18 to 45) who were either a household head or their spouse and moved into owner-occupied housing in the past year. The American Community Survey data do not separate out FTHBs specifically, but the median age of these young buyers was 34 in every year from 2018 to 2024, except in 2023, when it dipped to 33, aligning with the median estimates from large administrative data.
We find that homebuying among young adults peaked in 2021, when interest rates were at historic lows. Compared with 2021, the number of young adults who purchased homes in 2024 dropped by more than 26 percent.
The decline was widespread across nearly every age in the range, except for buyers up to age 20. Buyers ages 20 and younger saw a slight uptick in 2024 compared with other ages, but this group accounts for only about 1 percent of all homebuyers ages 18 to 45, so it does little to change the overall picture.
So although the median age at which young adults buy homes hasn't shifted much in recent years, the number of young adults able to buy homes has shifted. This points to a real and growing challenge for young adults trying to enter homeownership.
How homebuying patterns among young adults have shifted as homeownership has become more unaffordable
Our previous research shows that fewer of today’s young adults are becoming homeowners, with more renting or staying with parents or others. To understand which young adults are buying homes, we examined buying patterns among recent homebuyers younger than 35, an age range that approximates the FTHB population.
Our analysis shows that as housing affordability has worsened, young adults increasingly need either more financial resources or more help from older adults to become homeowners. These patterns are similar when we include buyers up to age 45 in our analysis.
We find that the share of young adults buying without a mortgage rose from 7.7 percent in 2018 to 10.2 percent in 2024. The share putting at least 20 percent down on a home purchase increased from 23.9 percent to 27.4 percent.
Meanwhile, the share with household incomes up to 80 percent of the area median income fell from 33.7 percent to 28.9 percent, suggesting homebuying is concentrating among wealthier young adults.
In recent years, young buyers were also more likely to purchase a home with someone substantially older than them. The share with a coborrower at least 20 years older rose from 3.7 percent in 2018 to 5.2 percent in 2024.
Together, these shifts suggest that the young adults who are still buying homes increasingly have access to family wealth, cash, or shared credit that others their age do not. Homeownership isn't just becoming rarer among young adults—it's becoming more concentrated among those with existing financial advantages.
Looking ahead
The typical age at which young adults buy homes hasn’t changed much, but who gets to buy, and how, has changed substantially. Because homeownership is a key source of building wealth, these growing disparities could widen wealth gaps within today's young adults over the long term.
These shifts also raise important questions about how housing finance policies, such as the design of down payment assistance programs and underwriting standards, might need to adapt as family coborrowing structures and other alternative paths into homeownership become more common.
To better understand young adult homeownership, our future analyses will explore
- how young adult homeownership, and the gap between younger and older adults, varies across locations;
- how rising housing costs affect young adults' decisions about having children or moving;
- how young adult homeownership in the US compares with other countries; and
- what promising, innovative solutions could help young adults—especially those who lack intergenerational support—achieve homeownership and build wealth going forward.
By building a fuller picture of the barriers young adults face in achieving homeownership, we can highlight gaps in current research and ultimately identify policies that could help lower barriers to homeownership.
