The housing market just hit a milestone — and it spotlights a generational change

First-time buyers hit a record low share of the homebuying market last year, another sign that affordability continues to make homeownership out of reach for many.

Only 24% of homebuyers surveyed by the National Association of Realtors said they were purchasing a home for the first time — a substantial drop from the 32% who said the same the year prior. Meanwhile, baby boomers were the largest cohort of homebuyers last year, making up 42% of all homebuyers.

The survey took place in July and included buyers who purchased a primary residence between July 2023 and June 2024. Results were released earlier this week.

Rising home prices, high mortgage rates, limited supply and competition with all-cash buyers continue to hamper many households' ability to move into homeownership, said Brandi Snowden, director of member and consumer-survey research at the NAR.

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During the period of the NAR survey, multigenerational homeownership reached an all-time high, making up 17% of all purchases. Twenty-one percent of Gen Xers surveyed by the NAR purchased a multigenerational home, as did 15% of younger boomers.

The cited reasons to buy a multigenerational house were myriad, but chief among them was cost savings, at 36% of all buyers who purchased a multigenerational home. Twenty-five percent pointed to health and caretaking of aging parents, while 21% attributed the decision to children and relatives older than 18 moving back home.

Multigenerational housing has over time become more prevalent in the United States. The Pew Research Center in 2022 found, based on an analysis of U.S. Census Bureau data between 1971 and 2021, the number of people living in multigenerational family households quadrupled, to 59.7 million.

In early 2021, 18% of the U.S. population was living in a multigenerational household.

Especially as the large baby boomer generation ages up, and younger generations have children, some age cohorts — notably Gen X and older millennials — are now considered "sandwich" generations, in which they are raising kids and caring for aging parents simultaneously. A 2022 study by the University of Michigan Department of Psychiatry found nearly one quarter of adults who provide care for at least one parent older than 65 years old also take care of at least one child younger than 18.

"[Some households] are really looking to purchase these kinds of homes for the cost savings involved; they’re taking in elderly parents, and having that multigenerational home is helpful," Snowden said. "As housing affordability is very difficult, maybe pulling together those incomes and purchase a larger home or splitting expenses is a way for families to approach caregiving."

Multigenerational housing is also more prevalent among immigrant households — in particular, with the recent rise of Asian and Hispanic populations in the United States. Along with Black Americans, each demographic is more likely than white Americans to live with extended family, especially if they are immigrants, according to the Pew Research Center.

Although affordability remains a key hurdle in the nation's for-sale housing market, homeownership has become more diverse, another recent NAR study found.

Snowden said the association doesn't forecast based on demographics or other consumer survey data, but the findings in the recently released data reflect trends that have been in play for a number of years now.

"For several years, we have seen buyers, especially these first-time buyers, are facing the same challenges — limited affordability especially," she said. "We are seeing first-time buyers are having difficulty saving for homebuying. We see first-time buyers are saying debt is holding them back."

That can include student-loan debt, car loans and even high rent payments for their current residence. Seventeen percent of all buyers reported having student-loan debt, with a median amount of $30,000. Millennials had the highest share of student debt, at 43%.

Originally published by Ashley Fahey – Managing Editor, National Content, The Business Journals Apr 2, 2025, Updated Apr 3, 2025 2:47pm EDT. Cincinnati Business Courier.