Older Americans — those typically on the tail end of the baby boom — are the ones buying and selling all the houses in the hot U.S. housing market.
The median age for a repeat buyer — someone who has bought a house before — is 58, according to new data from the National Association of Realtors. That’s slightly down from last year’s record of 59, but up significantly from age 36 in 1981, the year the association started keeping track. This year, the typical first-time homebuyer is 35.
“We are still talking about an incredibly difficult market for first-time buyers to enter, even if there’s slightly less competition,” Jessica Lautz, the association’s deputy chief economist, told The Washington Post. “If there’s a multi-offer situation, an all-cash buyer or someone who has a lot of equity is likely to win. And that person is going to be older.”
First-time buyers made up 32% of all home buyers, up from last year’s historic low of 26%, according to the realtor association. While that’s an increase, it is well below the 38% annual average since 1981.
“First-time buyers tiptoed back into the market this year with less competition and fewer multiple-offer scenarios,” Lautz said in a press release. “While the share of first-time buyers is still near historic lows, it is higher than last year. Notably, today’s first-time buyers had household incomes nearly $25,000 above last year and are more likely to use financial assets to enter the market.”
Higher home prices and mortgage rates have eroded housing affordability. The association noted that household income for those who successfully bought homes jumped by nearly $20,000 and topped six figures for only the second time in its records.
Older buyers are more likely to be sellers, which puts cash in their pockets. The typical home seller was 60 years old — unchanged from last year’s report. Sellers typically lived in their homes for 10 years before putting them on the market.
“In a still-competitive housing market, more well-off homebuyers were able to have their bids accepted by offering larger down payments and even by paying cash,” Lautz said.
One housing analyst, Meredith Whitney, founder and CEO of Whitney Advisory Group, predicted a “silver tsunami” as baby boomers age out of their homes and start downsizing.
Citing AARP estimates, Whitney said 51% of people over the age of 50 are set to downsize to smaller homes, a shift she predicts will begin in late 2024 and into 2025 and persist for decades to come. That could bring more than 30 million housing units back on the market, Yahoo Finance reported.
Household composition also continues to shift, according to the realtors association.
Seventy percent of recent buyers did not have a child under the age of 18 in their home, the highest share recorded. By comparison, in 1985, 42% of households did not have a child under the age of 18.
The report found 59% of recent buyers were married couples — the lowest share since 2010 — while single female (19%) and single male (10%) buyers increased. Nine percent of buyers were unmarried couples. Also, 14% of buyers purchased a multigenerational home, with the most common reasons being to take care of aging parents, to save money and to accommodate children or relatives over the age of 18 moving back home.