Homes have often sold for thousands of dollars above asking prices during the recent housing boom. And the generation that won many of those auction wars and bought a greater percentage of homes than a decade ago may come as a surprise: older Americans.
In 2009, people aged 18 to 39 made up almost half of home buyers, according to a new analysis by Zillow. By 2019, that number had fallen to 42%. At the same time, adults aged 60 and over fell from 16% of homebuyers in 2009 to almost 25% in 2019.
Since then, older Americans have continued to buy homes in large numbers, often pushing up prices and outperforming younger buyers.
Older buyers have a head start when competing for a home on the market. Many have the advantage over first-time buyers of being able to capitalize on the value of their existing home. Baby boomers have used the profits from the sale of their old homes to finance new homes that better match their ideal of retirement. Older buyers are also more likely to be able to bid all in cash, which research watch helps house hunters close the deal.
âWhether it’s downsizing or moving to a new city, baby boomers being more active means competition that previous generations didn’t have when buying their first home,â said Jeff Tucker, Senior Economist at Zillow. lifetime savings and home equity to operate in a competitive supply. “
In 2009, the median buyer was 40. The median climbed to 44 in 2019, before falling to 43 in 2021, Zillow found.
Millennials buy the most homes these days, with 37% of sales going to buyers aged 27 to 41. Gen X and Baby Boomers each make up 25% of home buyers. And the Quiet Generation (those 77 and over) buy almost as many homes as Generation Z (18 to 26).
Overall, the tilting of home purchases towards older Americans is a worrying trend, given that homeownership is equated with the American dream for many.
It has not gone unnoticed. The White House wants to make homeownership smoother and more accessible for first-time homebuyers, and the Biden administration recently announced a series of measures designed to tackle key barriers to homeownership. They plan to increase the supply of housing and expand funding possibilities.
But the obstacles for first-time buyers and the youngest are numerous. There is a widespread housing shortage, especially for the so-called starting houses, as well as an increase in the share of households be bought out by investors.
There are still some pockets of hope. Zillow found that in some cities where housing is cheaper, young buyers were still a high share of home buyers before the pandemic. In Buffalo, 57% of recent homebuyers were between 18 and 39 years old in 2019, and in Salt Lake City, 56% of homes in 2019 were sold to adults of the same age group.
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