Boomers Outpace Millennials and Gen Z in Tight U.S. Housing Market
The U.S. housing market poses significant challenges for younger buyers, particularly millennials and Gen Z. Rising mortgage rates and increasing home prices have made home ownership a daunting goal for many. The National Association of Realtors (NAR) reported a record low for first-time home buyers—just 21% in 2025. In contrast, the average age for first-time buyers has reached an unprecedented 40 years.
Current Trends in Home Buying
Jessica Lautz, NAR’s Deputy Chief Economist, emphasized the urgent need for affordable housing. She noted that the proportion of first-time buyers has decreased by 50% since 2007, just before the Great Recession. This decline highlights the real implications of a constrained housing supply.
- In 2025, first-time home buyer share fell to 21%.
- Typical first-time buyer age rose to 40 years.
- Older baby boomers made up 22% of home buyers in recent years.
- Younger millennials and Gen Z represented only 14% and 5%, respectively.
Demographic Shifts in Home Ownership
A notable 46% of homes purchased in 2024 were acquired by individuals aged 60 and above. Historically, younger generations made up a larger segment of home buyers. In 1991, the median age for first-time buyers was 28; by 2024, this increased to 38.
Impact of Rising Costs
High mortgage rates and soaring property prices have pushed the median home buyer’s age to 56, a stark increase from 46 in 2021. According to Torsten Sløk, Chief Economist at Apollo Academy, this trend portends challenges for the traditional American Dream, which often centers around home ownership.
- The median home buyer age jumped from 46 in 2021 to 56 in 2024.
- Median age of first-time buyers increased from 28 in 1991 to 38 in 2024.
Income Challenges and Affordability
Young buyers face financial obstacles, as wages have not kept pace with rising home prices. A recent U.S. Department of the Treasury report indicated that income growth has lagged behind both rent and housing price increases.
As of February 2024, the required income to afford a median-priced home was approximately $141,000. In contrast, the average U.S. salary hovered around half that amount. Danielle Hale, Chief Economist at Realtor.com, mentioned that the income requirement for home buying remains considerably higher than pre-pandemic levels.
Future Outlook
Despite current market difficulties, experts believe millennials and Gen Z will eventually secure homes. Jim Reid from Deutsche Bank highlighted that ownership will transfer over time from older generations, though the eventual pricing remains uncertain.
In summary, the U.S. housing market presents a complex landscape for younger generations. Until major shifts occur in either interest rates or home prices, challenges will persist for those aspiring for home ownership.
