First-time homebuyers increasingly pay all cash amid rising median age

A recent report highlighted that first-time homebuyers are increasingly paying all cash for their homes, a shift driven in part by generational wealth transfers, according to whqr.org.

The median age of first-time buyers has reached a record high of 40 years. Those paying all cash tend to be older, with a median age of 54, compared to 38 for those financing purchases. The use of inheritances or proceeds from inherited property is more common among all-cash buyers.

Personal savings remain the primary source for down payments overall, but more buyers are now using assets such as 401(k)s, stocks, or cryptocurrency rather than financial help from family or friends. Experts note that older buyers may be less comfortable seeking family loans or gifts.

The report suggests the share of first-time buyers using inheritances will likely increase as the boomer generation ages. This dynamic contributes to a growing divide between those saving independently and those benefiting from wealth transfers.

Real estate professionals report a rise in all-cash offers since the COVID-19 pandemic, attributing it to the need for competitive bids and the impact of high mortgage rates, which make financing more expensive over 30 years.