The National Association of Realtors (NAR) released a report on Friday that found 88% of all first-time homebuyers in the U.S. are white, while 8% are Hispanic, 3% are Black and 2% are Asian.
The share of Black and Asian first-time buyers is down from 6% in 2021, while the share of white first-time buyers is up from 82% and Hispanic homebuyers up from 7%.
“Housing affordability and limited inventory impacted the buying power of all buyers, however, the greatest impact was felt by Black and Asian Americans, as both groups saw a shrinking share of home buyers,” Jessica Lautz, NAR’s vice president of demographics and behavioral insights, said in a statement.
“Conversely, White and Hispanic Americans experienced gains in buyer shares. Population growth among Hispanic Americans likely drove the increase, while many White Americans are repeat buyers with housing equity that allows them to make easier trades in today’s market.”
The Hispanic population reached 62.5 million in 2021, up from 50.5 million in 2010. That’s a 19% increase in 11 years, as compared to the national growth rate of 7%. The Asian population grew by 23% during this time.
The NAR report also found that as a group, the share of first-time homebuyers dropped to a record low of 26% from 34% last year, and off the peak of 50% in 2010. The age of a first-time homebuyer increased to an all-time high of 36 years as compared to 33 years in 2021.
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Lautz said she is not surprised by the record -ow number of first-time buyers, attributing the reasons to housing affordability, high home prices, rising interest rates and lack of home inventory.
NAR found the age of repeat buyers increased to 59 years from 56 years last year. The median expected home tenure for first-time homebuyers was a record high of 18 years, compared to 10 years in 2021.
NAR data shows, 78% of buyers financed their home purchase, a reduction from 87% in 2021, with a typical down payment for first-time buyers at 6% and repeat buyers putting down 17%.
These factors also impacted when, where and how buyers purchased homes, according to NAR’s 2022 Profile of Home Buyers and Sellers, which also analyzed the demographic of buyers and sellers across America.
“Those who have housing equity hold the cards and they’ve fared very well in the current real estate market. First-time buyers are older as a result of saving for down payments for longer periods of time or relying on a generational transfer of wealth to propel them into homeownership,” explained Lautz.
NAR reports buyers moved a median distance of 50 miles away from their previous homes, triple the median distance of 15 miles recorded from 2018 through 2021.
Lautz attributes this to the presence of family support systems, home affordability and remote work, all of which contributed to a buyer’s decision to move farther away from their previous home.
Shares of homes purchased in small towns and rural areas increased to all-time highs of 29% and 19%, respectively. Meanwhile, homes purchased in suburban areas declined to 39% and urban areas to 10% from last year.
The report also says around nine in 10 buyers (86%) and sellers (87%) sought the help of a real estate agent or broker to buy or sell a house and the vast majority (90%) were satisfied.
The median age of home sellers is 60 years, compared to 56 years in 2021, and those seller typically spent 10 years in a home before selling. That’s the same time period recorded in 2019 and 2020 but an increase from eight years in 2021.
Buyers searched for a home for a median of 10 weeks, two weeks more than in 2020 and 2021, the report says. The typical homebuyer paid 100% of the asking price, with 28% purchasing for more than the asking price.