Helping the Next Generation Buy a Home: Why First-Time Buyers Are Waiting Longer

Why is the average first-time homebuyer now 40 years old? Garrett and Shelby break down the latest housing trends, affordability challenges, and why buying a first home has changed so dramatically over the past few decades.

Transcript

SPEAKER_00 0:00

Welcome to the Idaho Life Show real estate in community. I'm Garrett Thill. With me as always we have Shelby Matson here, top producing agent in the Treasure Valley, and she's also the VP of operations here at Idaho Life. Shelby, we have a number to put on the table today. And when I first read this a couple months ago, I had to read it twice to make sure I wasn't misreading it.

SPEAKER_01 0:21

I want to hear it because I have a feeling I know which one you're talking about, and it still gets me every single time I think about it.

SPEAKER_00 0:28

Yeah, so the NAR, which is the National Association of Realtors, they released their 2025 profile of home buyers and sellers for last year, Shelby. And they reported that the median age for a first-time home buyer in this country is now 4-0, 40. Wow.

SPEAKER_01 0:46

Four years old. Wow.

SPEAKER_00 0:48

So it's the highest it has ever been since they started tracking this back in is the early 80s.

SPEAKER_01 0:53

Yeah. And the historical jump on that number is what really stops me in my tracks. In 1992, the medium first-time buyer was 28. What a significant difference, right?

SPEAKER_00 1:04

Huge difference.

SPEAKER_01 1:05

It is scary, actually. Just four years ago, that number was 33. So in four years of time, we have added seven years to the age at which Americans can buy their first home. That is not a gradual drift. This is a huge jump.

SPEAKER_00 1:19

It is. And you know, first-time buyers as kind of a share of the overall home buying market, it's dropped to 21%, which is also the lowest share since NAR has been basically tracking these numbers. So going all the way back from when they started, you know, keeping track about four decades ago, seeing that number drop so low is is not a great number to see as well.

SPEAKER_01 1:41

I agree. I agree. And for every five homes that sold in this country, only one went to a first-time home buyer. Historically, that number has been around, I don't know, 40%. So yeah, right. So we're at roughly half of the long-term normal.

SPEAKER_00 1:56

Yeah. And then if you look on the median age of a repeat buyer, so someone that's buying again, that's bought before, that repeat buyer last year in the country was 62 years old, which is also another record that we hit. Yeah. So you've got first-time buyers in their 40s, right? You've got repeat buyers that are in their 60s. That's it's basically this is a generational picture and it tells you a lot about who is actually able to transact, you know, buy in the in this market.

SPEAKER_01 2:23

Yeah, for sure. And those who are already that already own homes who have built equity through years of appreciation, they are still very active. The people trying to get in for the first time without any of that equity behind them, they are getting older and older before they can even make the jump and make it happen.

SPEAKER_00 2:41

Yeah. And kind of the the why it matters, because this is not, and in my opinion, at least, Shelby, it's not a generation that has done anything wrong. It this is not the work ethic story where we think, you know, that the parents are thinking that the kids are not working as harder than we used to. This is you know not an avocado toast an avocado toast story. So this is it truly comes down to being a math story.

SPEAKER_01 3:04

Yeah. When you take medium home prices and compare them to the medium wages over the last 30 years, the lines have not moved together. Home prices have climbed dramatically faster that than the incomes, right? The cost of living. A 30-year-old in 1995 buying a starter home was looking at a fundamentally different ratio than a 30-year-old in 2025 is looking at right now.

SPEAKER_00 3:27

It's true. And then you you also add on, you got student debt, right? So you got those loans. You learn the mortgage rates, which are sitting right now, you know, we're the mid to six percent-ish. You take the fact that the family formation is happening a lot later in life than it is earlier. You've got people marrying later, they're having kids later, uh, they're settling into their finding their community later on in life as well. So kind of every traditional trigger that used to push someone into a first-time home purchase has shifted way later in life.

SPEAKER_01 3:59

Yeah. And here in the Treasure Valley specifically, a starter home in Boise or Meridian in 2010. Are you ready for this number? $170,000, right? The equivalent home today is well worth north of $400,000 at least. Young people who grew up here who want to plant roots near their families are watching the entry point move faster than they can chase it.

SPEAKER_00 4:25

Yeah, and kind of like the young couples that we see coming through our office, they're not asking, you know, can you find me a deal? They're asking, is this even a possibility? You know, can we do this? We're first-time buyers, we're 30 years old. We we we're not looking for a deal. We just want in a home, we don't even know if it's possible. So it's a very different question than I used to hear 10 years ago.

SPEAKER_01 4:47

For sure. And, you know, I don't want to make this a doom and gloom episode. No, right? There is a very interesting and frankly hopeful trend happening underneath this data. A movement among parents in their late 50s, 60s, and early 70s who have spent decades building equity in a treasure valley home, right? Because it they probably bought it for $170,000 or less, and who are starting to change the math for their kids. It's actually a really great thing.

SPEAKER_00 5:15

Yeah, it is. And then kind of the the great thing about this is that later in the show we're gonna have a lot of special things that are gonna happen and talk a lot about different factors and parents helping the kids. But we also have today someone coming in and they're going to be talking about first-time buying. They're a first-time buyer home specialist. Yes. Her name is Taylor Taylor Lee, and she is a first-time buyer specialist. She helps out all ages, all sellers, all buyers, but really has kind of found her niche in the first-time home buyer specialist here at Idaho Life. So she's gonna walk through kind of what she actually sees on the ground with the buyer she's working with, and then also how we're able to strategize and help the median 40-year-old age, you know, median buyer shift that down to be lower with the help of parents with extra resources. She might talk about some loans that are out there. So we're really trying to hear to support and show folks that are first-time buyers that you don't have to wait until you're 40 anymore.

SPEAKER_01 6:16

That's right. You definitely do not. Stay with us, Treasure Valley. When we come back, we are digging into the quiet trend, changing the map for thousands of families. You're listening to the Idaho Life Show, Real Estate and Community.