The median age of first-time homebuyers has climbed to a historic high of 40, according to the National Association of Realtors (NAR), delaying the critical wealth-building benefits of homeownership for younger generations facing steep affordability hurdles.
A report published Thursday by Realtor.com reveals that purchasing a home by age 30 yields a 22.5% higher net worth by age 50 compared to waiting until one’s 40s. However, with the time required to save for a downpayment stretching to an average of nearly 10 years, the long-term benefits of early homeownership are increasingly restricted to those with preexisting family wealth or assistance.
Today’s prospective buyers face a significantly different market than previous generations. According to data from NAR cited by Realtor.com, the median age of a first-time homebuyer surged from 30 in 1990 to 40 in 2025. This delay is largely driven by home prices outpacing income growth.
Realtor.com notes that the time needed to save for a typical downpayment has expanded from roughly three years in 1990 to nearly 10 years in 2025. Consequently, the overall U.S. homeownership rate currently sits at 65.7%, trailing pandemic-era highs of 68%, according to the report.
Early homeownership as a wealth multiplier
Delaying homeownership shortens the window for equity to compound. A Realtor.com analysis of the Panel Study of Income Dynamics (PSID), a longitudinal household survey directed by faculty at the University of Michigan, found that securing a home by age 30 is associated with an average boost in net worth of $119,000 by age 50 versus those who did not purchase until their 40s.
“Homeownership has long been a cornerstone of financial security in the U.S., and our analysis shows that laying that foundation sooner can have big impacts,” said Danielle Hale, chief economist at Realtor.com, in a press release accompanying the report.
“Earlier entry into the market doesn’t just provide a place to live; it catalyzes broader balance-sheet growth,” she continued. “By gaining more years for appreciation and mortgage paydown, early homebuyers build a foundation of wealth that supports opportunities that cascade into the next generation.”
The role of family wealth in compounding disparities
Because of these steeper barriers, familial financial assistance has become a vital bridge to property ownership, according to the Realtor.com analysis.
- Parental transfers: According to Federal Reserve research cited in the report, parental wealth transfers explain about 13 percentage points of the homeownership rate among young households.
- Gifts and loans: About 1 in 5 first-time buyers now rely on a gift or loan from family or friends to fund their purchase, according to NAR.
- Inheritance: Receiving an inheritance of at least $5,000 makes a family 2.5 times more likely to become homeowners, according to Inequality.org data.
- Upbringing: A Realtor.com analysis of PSID data shows that adults raised entirely in homeowner households are 18.4% more likely to purchase their own home by age 35.
The growing necessity of intergenerational wealth to break into today’s housing market reinforces longstanding racial and economic divides. According to the U.S. Census Bureau’s Housing Vacancy Survey, the fourth-quarter 2025 homeownership rate for white households remained high at 75.1%, compared to 48.7% for Hispanic households and 44.2% for Black households.
For historically marginalized groups, even modest financial assistance is highly transformative. Inequality.org data cited in the report highlights that receiving a $5,000 inheritance makes Black households at least five times more likely to become homeowners.
As Hale noted, “The widening affordability gap isn’t just a hurdle for today’s buyers, it’s a structural challenge to economic mobility that compounds over decades.”
