First-time home buyers made a comeback in 2023, gaining market share even as higher mortgage rates and rising home prices made purchases less affordable. According to the 2023 Profile of Home Buyers and Sellers conducted by the National Association of REALTORS©, first-time buyers accounted for 32% of all home purchases. This is a substantial improvement over the 26% of market share held in 2022.
However, successful first-time buyers are still fewer in number than in years past, when they typically claimed 38% of the market. The high point for first-time buyers was back in 2010, when they accounted for 50% of all home purchases.
The 2023 gain in market share came at a price. The survey shows a median annual household income of $107,000 for first-time buyers, a nearly 20k increase over income thresholds shown in the 2022 survey.
First-time buyers made an average down payment of 9%. About 24% of survey respondents tapped their retirement savings or investment accounts to generate their down payment. 11% of first-time buyers sold stocks or bonds. 11% used funds from a 401k, IRA or pension. 2% reported selling cryptocurrency.
When looking at demographics, most first-time buyers were Millennials with a typical age of 35. This is similar to 2022’s findings, where the typical first-time buyer was 36. 59% were married couples. 70% of them did not have children under 18 years old.
What is unspoken, but evident in the survey, is a widening wealth gap among first-time buyers. Unrelenting home price increases, paired with interest rate levels that are double from two years ago, have pushed home ownership out of reach for a growing number of people.
This is easy to overlook while home inventory is low, and homes are selling quickly. However, there are not enough affordable homes for buyers with the national median income of $74,580, or for those earning less. This is one possible reason why the number of successful first-time buyers are below historical norms.
Now the good news: you don’t have to be rich to buy a Columbus area home, but you do need to be well-informed! Not all homes are priced correctly for their condition or for the prevailing market trends. We show you how to identify value and create a compelling purchase offer in our free e-book, “How to Buy a Home like a Pro!” Get your copy now at the link, there is no charge and no obligation.
As Exclusive Buyer’s Brokers, we serve your best interests at all times! Unlike real estate agents and brokerages who represent sellers, as an Exclusive Buyer’s Broker, we only represent you, the buyer, getting you the best price and terms with no conflict of interest at all times.
Understanding this distinction could literally save you thousands of dollars not only on the purchase price and terms, but also on seller concessions and home inspection issues, whether you are a first-time homebuyer or an experienced homeowner!
Contact us with your home buying questions! Remember, we are with you every step of the way…all the way home!
Andrew Show
Exclusive Buyer’s Broker, CEBA-M, MCNE, CSP, PSA,e-PRO, CREM, ABRM, AHWD
Buyer’s Resource Realty Services www.BuyersHome.com
Serving Metro Columbus, Ohio with Exclusive Buyer’s Agents
7100 North High Street, Suite 204, Worthington, Ohio 43085
614-888-4110 | 888-888-4110 Toll Free | 614-839-4110 Fax
