Baby boomers made up 39% of home buyers last year– more than any other generation, and up from 29% in 2021, according to the 2023 Home Buyers and Sellers Generational Trends report from the National Association of Realtors®. Millennials (now ages 24 to 42) had been the top homebuying cohort since NAR’s 2014 report.
Generation Y/Millennials’ share fell from 43% in 2021 to 28% last year.
The segment with the highest median household income, Generation X (43 to 57 years old), made up 24% of total buyers.
Generation Z (ages 18 to 23) now makes up 4% of buyers. Three of every 10 Gen Z buyers (30%) move directly from a family member’s home into homeownership.
The Silent Generation (buyers 77 to 97) represented only 4% of buyers. They indicated being closer to friends and family as a primary reason for their purchase decision.
NAR reported 26% of all buyers were first-timers, down from the year-prior figure of 34%. Last year’s figure was the lowest since the association started tracking the data.
Fourteen percent of home buyers purchased a multi-generational home, with older boomers and Gen Xers making up more than a third of those purchasers.
Among all buyers, 78% financed their home purchase. NAR found the share decreases as the age of the buyer increases. Younger buyers depend on savings for their downpayment, while 22% of them receive help in the form of a gift or loan from a friend or relative. Older buyers use proceeds from the sale of their previous residence.
The generational trends report examines the similarities and differences of recent buyers and sellers across generations. NAR said buyers ages 58 to 67 (younger baby boomers) and buyers 68 to 76 (older baby boomers) were broken into two separate categories for the report as they have differing demographics and buying behaviors.
“Baby boomers have the upper hand in the homebuying market,” said Dr. Jessica Lautz, NAR deputy chief economist and vice president of research. “The majority of them are repeat buyers who have housing equity to propel them into their dream home – be it a place to enjoy retirement or a home near friends and family. They are living healthier and longer and making housing trades later in life.”
Lautz was encouraged by the entry of Gen Z into the homebuying the market. “The desire for homeownership is strong, and many are relying on family support systems to help make their first real estate purchase.”
Baby boomers retained their position as the largest home seller generation. In 2021, they account for 42% of sellers. Last year, the figure jumped to 52%.
All generations agreed the most common reason to sell was to be closer to friends and family. The younger generations also cited the desire for a larger home and job relocation as leading reasons to sell their home. For older generations, retirement also prompted the decision to sell.
NAR’s 137-page study found that 86% of all buyers purchased their homes through a real estate agent. The number was highest among younger boomers (90%) and Gen X (88%). More than three-fourths (76%) said they would use their agent again or recommend their agent to others.
Eighty-eight percent of all buyers said they view a home purchase as a good investment. About three of every four younger millennials (74%) and older millennials (77%) viewed a home as better than or about as good a financial investment as stocks.
“Owning a home is more than just a financial investment. It’s a symbol of stability, independence and community that helps people build their lives and achieve their dreams,” said NAR President Kenny Parcell, a Realtor® from Spanish Fork, Utah, and broker-owner of Equity Real Estate Utah. “Whether you’re a first-time home buyer or an experienced investor, Realtors® have the expertise and knowledge needed to provide valuable advice and help you make informed decisions about your purchase.”
NAR’s survey, based on random sampling, had an adjusted response rate of 3.2%. The association mailed a 129-question survey in July 2022 to 153,045 buyers who purchased a primary residence between July 2021 and June 2022. The recipients were representative of sales on a geographic basis.