In the past 10 years, an average of 1.5 million bought their first home every year, down from the historical average of 1.8 million a year.
CNN Money points out that the difference between the figures comes out to three million people in total who haven’t been able to buy a home over the last decade. Many of these potential buyers have been shut out due to low inventory and rising home prices.
First-time buyers make an enormous impact on the market. They purchase smaller entry-level homes, which allows current homeowners to trade up for bigger, more expensive homes. Plus, they represent the shift of housing demand from renting to owning.
But it looks like first-timers are coming back to the market. From 2014-2016, first-time buyers accounted for 85% of the housing market's expansion, according to the report. In 2016, there were two million first-time buyers, a 15% increase from the year before.
Advertisement
Related Stories
Economics
Shelter Costs Drive Inflation Higher Than Expected in January
January Consumer Price Index data show inflation increased more than anticipated as shelter costs continue to rise despite Federal Reserve policy tightening
Economics
Weighing the Effects of the Fed's and Treasury's Latest Announcements
The upshot of the Jan. 31 announcements is that while mortgage rates will stay higher for longer, they're likely to hold steady
Economics
NAHB CEO Tobin Says 'Housing Renaissance' on the Horizon
Responding to positive housing-related data such as falling mortgage rates and increased homebuyer activity, NAHB's CEO Jim Tobin is optimistic
