Today’s First-Time Homebuyers Older, More Often Single from Les and Elaine

new_home_sale_soldZillow’s analysis of first-time homebuyers found they are renting for six years before buying, compared to an average of 2.6 years in the 1970s

– Americans are renting more than twice as long before buying their first home as they did in the 1970s.

– First-time homebuyers are older and less likely to be married than they were in the past.

– Americans are buying increasingly expensive first homes and spending more relative to their incomes than any time in the past 40 years.

Aug 17, 2015

SEATTLE, Aug. 17, 2015 /PRNewswire/ — Today’s first-time homebuyer is older and more likely to be single than first-time homebuyers in the 1970s and 1980s, according to a new Zillow® analysisi.

Zillow’s study found that Americans are renting for an average of six years before buying their first homes. In the 1970s, they rented for an average of 2.6 years. They’re also spending a bigger chunk of their incomes to buy: In the 1970s, first-time homebuyers bought homes that cost about 1.7 times their annual income. Now they’re buying homes that cost 2.6 times their annual income.

Part of that can be attributed to the housing markets where millennials are moving: more expensive cities on the coasts, where there are growing job markets.

The average first-time homebuyer is about 33, at the front end of the millennial generation. Their median income is $54,340, which is about the same as what first-time homebuyers made in the 1970s, when adjusted for inflation.

In the late 1980s, 52 percent of first-time homebuyers were married. Today, only 40% were married.

“Millennials are delaying all kinds of major life decisions, like getting married and having kids, so it makes sense that they would also delay buying a home,” said Zillow Chief Economist Dr. Svenja Gudell. “We know millennials value home-ownership and want to buy. The next challenge will be figuring out how they can save for a down payment and qualify for a mortgage, especially while the rental market is so unaffordable all over the country. The last hurdle will be finding a home they like amidst very tight inventory, especially among starter homes.”

Years

Median Age

Median Income (in 2011 dollars)

Median Home Price (in 2011 dollars)

Price-to-Income

Percent Married

Number of Family Members

Median Years Renting

1970-1974

30.6

$52,831.53

$87,371.37

1.7

Not available

3

2.6

1974-1979

29

$54,869.55

$98,772.99

1.8

Not available

2.6

4.6

1980-1984

29.6

$51,178.56

$102,367.05

2

Not available

2

5

1985-1989

30.4

$58,296.90

$107,942.98

1.9

52%

2.4

4.4

1990-1994

32.2

$52,400.80

$98,697.29

1.9

44%

2

5

1995-1999

33.3

$51,418.35

$112,528.86

2.2

44%

2.3

5.5

2000-2004

33.5

$58,738.00

$144,796.52

2.5

47%

2

5.5

2005-2009

33.3

$58,087.91

$162,648.76

2.8

40%

2

6

2010-2013

32.5

$54,339.84

$140,327.58

2.6

40%

2

6

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

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