The real estate market is rapidly evolving. If you’re considering a sale or purchase, it’s important to understand who today’s buyers and sellers are, what they want, and the common threads for getting to the closing table. The NAR 2025 Profile of Home Buyers and Sellers can help us unpack this data, offering insight into consumer behavior, motivations, and how expectations are shifting compared to past years. Here are some of the key takeaways shaping the market.

THE TWO SIDES OF THE BUYING COIN
Two polar opposite trends have emerged in purchasers. On one side, we have an all-time high of all-cash buyers. On the other, we have a substantial drop in first-time buyers who currently make up only 21% of the market—the lowest share ever recorded by the NAR. The share of first-time buyers prior to 2008 was historically around 40%. Additionally, people are waiting longer to purchase their first home as the median age of first-time buyers has climbed to 40. 

In past generations, homeownership helped pave the way to financial security with the median age of first-time buyers in the 1980s being in their late 20s. As summarized by Shannon McGahn, NAR executive vice president and chief advocacy officer, “Delayed or denied homeownership until age 40—instead of 30—can mean losing roughly $150,000 in equity on a typical starter home.” Increases in rental costs, home prices, and student loan debt have left many would-be buyers short on the funds needed for a home purchase. In turn, this means they’re missing out on the home equity growth that their generational counterparts experienced. 

This leads us to the explosion of cash buyers. About 26% of purchases over the last year were buyers that skipped financing altogether and were able to pay for their home in cash. By comparison, fewer than 10% of buyers in the early aughts were all-cash.

Many of these buyers are leveraging the equity from a primary home sale, but investors have also played a role in the rise of cash deals. 2025 saw a record share in Q2 when 33% of single-family sales in the US were purchased as investment properties. Overall, investors currently hold about 20% of the nation’s single-family homes. The prevalence of cash deals continues to widen the gap for first-time buyers as they struggle to compete and spend far more in the long run due to financing expenses.

MORTGAGE COMMONALITIES
For buyers using a mortgage, the amount of money they put down has been trending upward. The median down payment in 2025 was 19% for all buyers—23% for repeat and 10% for first-time buyers. This was the highest median down payment for repeat buyers since 2003 and the highest for first-time buyers since 1989.

First-time buyers typically used savings for the down payment at 59%. Tapping into retirement or other investment accounts was the second most common source for first-time buyers at 26%, and 22% received help from family or friends. More than half of repeat buyers used the proceeds from their previous home toward their purchase. 

The use of low- or zero-down payment government-insured mortgages, such as FHA and VA, has experienced a steep decline. The NAR reports that FHA, in particular, has fallen from 55% in 2009 to 28% in 2025. Though these loans are intended to promote homeownership by lowering down payments, having lower credit score requirements, and accepting higher DTI, they’re not as competitive as conventional loans in seller’s markets due to stricter property condition standards.

HOUSEHOLD MAKEUP
Over half of all homebuyers in 1985 had minor children. The NAR report found that only 24% of recent buyers had children under 18, with most households having only one child. This makes sense given the rise in older repeat buyers, but it’s worth noting as the buying pool becomes less centered around parents. Married couples remain the largest demographic of homebuyers, though their market share fell to 61%. Single women made up 21% of all buyers with single men coming in at 9%.

TENURE
In the early 2000s, owners stayed in their home for an average of six years. This reached a new high over the last year with median tenure at 11 years, and it’s expected to jump to 15 years. 28% of recent buyers said they don’t plan to move again after purchasing their “forever home.” This sentiment was shared by both repeat and first-time buyers. As fewer households have children and the age of buyers increases, many people are passing on the idea of a transitional “starter home.”

REPRESENTATION
Perhaps you’ve heard about the NAR lawsuit that led to sweeping industry changes in 2024. (If you haven’t, here’s a primer.) There was plenty of speculation in the immediate aftermath over how this would impact agents’ involvement in transactions. Now, more than a year out from the effective changes, we know that consumers are still overwhelmingly choosing agent representation in both buying and selling. 88% of buyers and 91% of sellers hired a real estate agent to assist with their deal in 2025. FSBOs hit an all-time low of 5%. 

Despite the hurdles of pricing, delayed first-time purchases, and the dominance of cash buyers, the outlook for this year’s housing market shows good potential for both buyers and sellers. Established homeowners will continue to have strong equity positions, while new buyers will benefit from more sustainable growth. It’s especially important during times of change to be well-prepared and have a trusted professional on your side. Contact your Realtor for local market insights and a plan tailored to your needs!