Housing market dominated by white, older and wealthier buyers

The share of first-time buyers has fallen to a record low, struggling to compete in a U.S. housing market flooded with older, whiter and wealthier buyers.

That’s according to the annual profile of home buyers and sellers released Thursday by the National Association of Realtors.

First-time buyers at the lowest

The share of first-time home buyers navigating today’s housing market has fallen to just 26% – the lowest share the National Association of Realtors has seen in the more than 40 years it publishes his report.

This is a sharp drop from 34% last year and a peak of 50% in 2010.

“It’s no surprise that the share of first-time buyers has fallen to an all-time low given the housing market’s combination of historically low inventory, persistently high house prices and rising interest rates. rapidly increasing,” said Jessica Lautz, vice president of demographics and behavior. insights for the National Association of Realtors.

White buyers dominate the housing market

White buyers make up 88% of all homebuyers — up from 82% a year ago — a figure that far outstrips buyers of other races. According to the report, only 8% of shoppers were Hispanic Americans, 3% were Black Americans, and 2% were Asian Americans.

While the shares of white and Hispanic Americans rose from a year ago, the shares of black and Asian Americans declined, both down from 6% last year.

“Housing affordability and limited inventory impacted the purchasing power of all buyers, however, the greatest impact was felt by Blacks and Asian Americans, as both groups have seen a declining share of homebuyers,” Lautz said.

“Conversely, white and Hispanic Americans saw gains in buyer share. Population growth among Hispanic Americans has likely driven this increase, while many white Americans are regular buyers with home equity that allows them to make easier transactions in today’s market. .

Buyers are getting older

The age of the typical first home buyer was 36, up from 33 a year ago. In addition, the typical age of the regular buyer has risen to 59, from 56 last year.

“Both ages are the highest in the history of the dataset. The median expected tenure for first-time buyers was 18 years, the highest on record and up from 10 years in 2021,” the report said.

The report also illustrates that buyers with existing wealth – whether equity or inheritance – enjoy a clear advantage in today’s market.

“Those with home equity hold the cards and they’ve done very well in today’s real estate market,” Lautz said. “First-time buyers are older because they have saved for down payments for longer periods or rely on a generational wealth transfer to propel them into homeownership.”

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