Share of First-Time Buyers For New Single-Family Homes Declines in 2024

According to the latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index survey (HMI), 40% of builders’ single-family home sales so far in 2024, on average, have been made to first-time home buyers. That share has doubled since 2016, when only 19% of builders’ sales went to first-time buyers.

NAHB notes that its limited time series on this topic in the HMI survey indicates that first-time home buyers purchased an increasing share of new homes between 2016 and 2021, when the proportion rose from 19% to 43%. Unfortunately, the series has a two-year hiatus (2019 and 2020) when no data are available.

However, since 2021, growth in the new-home first-time buyer share has stopped. After holding steady at 43% in 2022, the share has lost ground in each of the past two years, slipping to 42% in 2023 and then to 40% in 2024.

NAHB says that more detailed analysis shows there is a direct correlation between the first-time buyer share and builder size. In other words, the larger the builder, the more likely it is for a higher share of its sales to go to people buying a home for the first time. To be more precise, builders with 1–5 single-family starts a year reported that only about 18% of their sales so far in 2024 have gone to first-time buyers. That average increases to 21% among builders with 6–24 starts, increases to 34% among those with 25–99 starts, and reaches 44% among builders who start at least 100 homes a year.