Regardless of what you’ve heard, first time homebuyers are usually not getting dramatically older.
Statistics are like scorching canines — typically juicy however with generally questionable substances. A current instance is a narrative racing across the nation: first-time homebuyers’ median age is 40 this 12 months, versus simply 28 years outdated in 1991. This alarming development was explored in a November 6 New York Instances article, citing survey knowledge from the Nationwide Affiliation of Realtors (NAR).
However I fell right into a lure of my very own making, by ingesting a “wow” statistic that strengthened my very own expertise — I purchased my first home in 1991 at age 29. Now I’m listening to this stat in all places, in information tales and up to date conferences I’ve attended. Statistics like this go viral, by concurrently carrying “factual weight” and but stirring feelings.
But the statistic, as compelling because it appears, is probably going mistaken. Housing economists Edward J. Pinto and Joseph S. Tracy on the American Enterprise Institute (AEI) have lately reported why. The 2 delved into the less-than-appetizing methods the NAR statistic was created. In July 2025, the NAR workforce despatched out 173,250 surveys with 120 questions to reply on-line.
Solely 6,103 individuals bothered to reply, a response fee of three.5 p.c. Solely 1,281 of that group have been first-time homebuyers.
Not solely that, however the AEI workforce discovered that these below 35 have been under-represented by 17 p.c and people aged 45 to 74 have been over-represented by 18 proportion factors.
The NAR economists declare their statistics have ninety-five p.c confidence, plus or minus 1.25 p.c, however statistical confidence for representing a US inhabitants of round 86 million owners collapses when the pattern is now not random. Fancy weighting methods could give an aura of fixing the issue, however depend on subjective guesswork and hard-to-track biases.
Pinto and Tracy at AEI as a substitute used the New York Federal Reserve Financial institution Client Credit score Panel (CCP), which makes use of a five-percent random pattern of all credit score experiences tied to a Social Safety quantity, and offers borrower age and residential shopping for historical past.
And guess what they discovered? The median age of the first-time homebuyer is roughly 33 years outdated — not 40 — and has been regular between 2001 and right now. Analysis by The Cato Institute utilizing the US Census Bureau’s American Housing Survey additionally “casts doubt” on the NAR knowledge, revealing outcomes just like these reported by AEI researchers.
The wrong NAR reality nugget may quickly dissolve if it didn’t carry a lot emotional resonance with those that really feel the housing market is “unfair.” However right here’s the deeper drawback: when a statistic feels true, as a result of it matches in our narrative of how the world works, its energy can quickly sway public insurance policies within the mistaken route.
What Pinto and different housing specialists agree upon (together with the NAR economists) is a widespread housing affordability drawback, however the bigger lesson is that it’s impacting individuals throughout all ages. Because of zoning restrictions on housing density and different challenges, we’re merely not constructing sufficient properties.
What’s extra, we make it very troublesome for a lot of to buy properties in less-affluent areas, by making so-called “small greenback mortgages” much less worthwhile for banks to problem. Dodd-Frank banking rules within the wake of the 2008 Nice Recession vastly elevated the overhead for issuing these loans, leading to a fast drop in mortgage entry on the decrease finish of the market, as The Wall Road Journal has beforehand reported.
My analysis with colleagues at New America reveals that hundreds of thousands of cheap properties exist in the USA, however the financing is unavailable for a lot of households. This results in falling homeownership charges, and in some circumstances, property values. Solely 23 p.c of properties that price beneath $100,000 (together with condos) have been bought with a mortgage mortgage, in response to a 2020 City Institute research. Money patrons made up the remainder.
Neighborhood banks, which usually tend to serve these prospects, are significantly laborious hit by the Dodd-Frank banking rules. Since 2010 we’ve misplaced over 3,600 group banks, “a discount of over 45 p.c,” in response to Treasury Secretary Scott Bessent’s remarks at a convention in October 2025.
In different phrases, if we need to think about bettering homeownership throughout all ages, we have to base our insurance policies on statistics which are constructed upon rigorous methodological foundations. In any other case, repeating an appetizing however incorrect statistic round first-time homeownership may result in persistent financial heartburn.
