The national picture is grim – but certain pockets are offering hope for new homebuyers
Times are tough for first-time homebuyers across the US, with booming prices and rental costs continuing to widen the divide between hopeful entrants to the housing market and those who already own a home.
The stats tell their own story: the share of first-time buyers in the real estate market fell to a historic low of 24% last year while the average age of those purchasing their first property continues to tick closer to 40, rising to 38 in 2024, according to the National Association of Realtors (NAR).
But while the national figures paint a gloomy picture of younger Americans’ hopes of buying a property, that trend is also a regional one with certain markets seeing much better prospects than others.
Just ask Hunter Bolling (pictured top), a Dallas-based mortgage broker who told Mortgage Professional America he’d seen first-hand how the outlook can vary for first-time buyers depending on where they’re planning to purchase.
“I will say it depends on the state,” he said. “In Texas, I’ve had four buyers this year under the age of 25. But my wife is licensed in Virginia and she sees something different – that average age creeping into the mid-to-late 30s.”
First-time market entrants often outflanked by cash-rich buyers
In Texas, first-time buyers might typically purchase a home for somewhere between $300,000 and $360,000 – significantly lower than red-hot national markets such as New York and California, where average properties could change hands for hundreds of thousands of dollars more.
Still, that affordability is presenting its own challenges for Texas residents – namely, increased competition from outside the state as first-time buyers jostle with newcomers who are often flush with cash and have more firepower in a bidding war.
Kevin Kenerson of Lending Hand Mortgage stresses that waiting to buy means paying more later. He shares how assistance programs and credit support can help buyers navigate today’s tougher market.https://t.co/dNmmi1phZV
— Mortgage Professional America Magazine (@MPAMagazineUS) May 20, 2025
“In Texas specifically, a lot of people are moving here and a lot of people are trying to stay here,” Bolling said. “It’s that battle for those homes… They’re competing with people who have the cash and who have the reserves.”
Mortgage brokers can offer borrowers a valuable advantage in that war, he added: the ability to close a deal and get it over the line before competition from other parties intensifies during the bidding process.
That could be part of the reason brokers are steadily growing market share and cutting into retail profits. “One of the main reasons that I see this shift form retail to wholesale, the broker side, is speed,” Bolling said. “The way that I’ve beaten cash [offers] is speed.
“Our average to close last year from start to finish was 7.2 business days. That’s how we beat out-of-state buyers – with speed. And we have to prep the buyer.”
That preparation means going through an application in detail either on a Zoom call or in person, crunching the numbers and finding the most efficient way to get a deal signed, sealed and delivered – an especially arduous task in the current market, with general affordability and cost of living a “massive crisis” in Texas right now.
The state may have seen a big tax cut last year, “but it’s nothing that’s drastically changing monthly payments,” Bolling said. If anything, a spike in home insurance costs in 2024 “offset” that tax relief.
That’s not to mention stubborn mortgage rates, which have continued to hover in the 6.5%-7% range despite hopes at the beginning of the year that borrowing costs were due to tick lower.
“It’s really setting the gameplan out front so when we’re ready to execute, those homebuyers know their plan is in place and what it’s going to take to get into a home,” Bolling said.
Downpayment assistance the right option for some – but not all - buyers
Unsurprisingly, downpayment assistance programs are increasingly popular among first-time buyers struggling to drum up the required amount on their own, but Bolling urges them to think long and hard about whether that’s the right option before taking the plunge.
“From experience of downpayment assistance here, if rates do fall over the next three years you’re either paying that money back or you’re trying to figure out a way to get into that lower interest rate,” he said. “I saw people [complaining] on the phone in 2020, 2021 because they weren’t educated on the downpayment assistance they took out – they couldn’t refi.
“So that’s my biggest thing. If people are scared because liquidity is hard, I get it, and they get into a home. But also make sure you educate them on what the loan program entails.”
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
