"They have strong demand for the American dream of homeownership, but they're really just feeling left behind right now, Jessica Lautz, the deputy chief economist at NAR, said of first-time buyers. Homeownership is a way that many Americans build wealth and unfortunately they're just being pushed to the sidelines for a longer period of time and losing out on those wealth gains. They're also thinking about unique ways to enter into homeownership."
"For many first-time buyers, saving for a down payment remains the largest financial hurdle to homeownership. NAR data shows that today's first-time buyers are putting 10% down, the highest amount in nearly 40 years. Although the most common source for these funds remains personal savings, NAR found that many are also tapping into other financial assets, including retirement funds and stocks. Others have received financial help from relatives or friends through a gift or a loan."
"Additionally, Lautz noted that many first-time buyers are looking to improve their financial situation by doing things like living with family to save on rent or pooling resources to buy a property with roommates and friends. The report added that many are also looking at more mortgage options, including adjustable-rate mortgages, which typically offer lower initial rates before later resetting."
Demand for homeownership among first-time buyers remains strong, but many are being sidelined from purchasing. First-time buyers comprised 21% of the market in 2025, an all-time low, and their average age rose to 40. Saving for a down payment is the largest financial hurdle; average down payments rose to 10%, the highest in nearly 40 years. Buyers are using personal savings, retirement funds, stocks, and family gifts or loans. Many are living with family, pooling resources, or choosing adjustable-rate mortgages for initial affordability, though ARMs carry long-term risk.
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