2025 Aspiring Homeowners Report: 70% Fear They Will Never Own a Home
Owning a home remains a big goal for many Americans. However, rising prices and limited inventory present substantial challenges. According to the National Association of Realtors (NAR) 2024 Profile of Home Buyers and Sellers, the national median sale price for homes reached $435,000, nearly doubling since 2014.
To explore the realities of today’s first-time homebuyers, the This Old House research team surveyed 2,000 aspiring homeowners and analyzed data from Redfin, a national real estate brokerage. This report uncovers the biggest hurdles and opportunities for those who want to make their homeownership dreams a reality in 2025.
Key Findings
- 70% of aspiring homeowners are concerned they will never be able to own a home, and 62% believe the housing market is rigged against first-time homebuyers.
- Home prices (70%), mortgage rates (49%), and saving for a down payment (43%) are considered the biggest obstacles to homeownership.
- 78% of aspiring homeowners say the federal government should assist first-time homebuyers with down payments.
- El Paso, Texas, is the best city for aspiring homeowners, thanks to low sale prices ($250,000) and high inventory.
70% of Aspiring Homeowners Say Prices Are Too High, and 41% Expect Them To Get Even Higher
The housing market remains a significant challenge for aspiring homeowners. As of October 2024, the national median sale price for a home was $435,000, far above the $200,000 that most respondents said they could afford—a gap of $235,000.
Home prices have nearly doubled since 2014. Our respondents estimated the typical home price at around $300,000. Over the past five years alone, home prices have surged by 48%, while inventory has decreased by 24%, making it increasingly difficult for buyers to find affordable options.
This sharp price increase has created a sense of unease among aspiring homeowners. Our survey found that 70% consider high prices a major obstacle to homeownership, and 70% are concerned that they may never be able to afford a home.
Additionally, 62% believe the current market is biased against first-time buyers, and only 18% of respondents feel that now is a good time to buy. Just 16% plan to purchase a home within the next year, and only 18% believe they could afford one today. In addition, 41% of respondents expect home prices to continue rising in 2025, adding to the growing sense of frustration and uncertainty in the housing market.
Aspiring Homeowners Are Worried About Down Payments, and 78% Believe the Government Should Help
Down payments remain a major barrier for many aspiring homeowners. Nearly half (43%) of respondents said they can’t save for a down payment, with a 20% down payment on the median home price of $435,000 requiring a daunting $87,000. For context, that’s over a year’s salary for many Americans—the median household income was $77,719 in 2023, according to the U.S. Census American Community Survey.
To overcome this hurdle, 51% of respondents plan to put down less than 20%. This typically requires mortgage insurance, adding to their monthly expenses if they choose to go this route. Reflecting on the financial challenges of homebuying, 78% of respondents believe the federal government should provide down payment assistance to first-time homebuyers.
Aspiring homeowners are also making sacrifices to save for their future homes, including 37% who are delaying vacations and 23% who say they’ve taken on a second job or side gig.
Would-Be Homeowners Are Willing To Compromise on Location and Size for a Good Deal
Aspiring homeowners are increasingly ready to make sacrifices to achieve their homeownership goals. Half (50%) of respondents don’t believe they can find an affordable home in their current area, but many are open to relocating. Most aspiring homeowners (61%) are willing to move neighborhoods, while 29% are willing to move to an entirely different part of the country.
Compromises aren’t limited to location—many are also flexible on the features of their future home:
- 55% would consider a smaller home if it meant getting a good deal.
- 39% are open to a longer commute.
- 36% would forgo having a yard.
- 33% are willing to compromise on school district quality.
- 21% would accept a less safe neighborhood.
However, buyers draw the line at certain risks: Just 15% would buy in an area with a high risk of natural disasters, even for a good deal.
Best Cities for Aspiring Homeowners
We used monthly data from Redfin to find the best cities for aspiring homeowners. We ranked the 100 biggest U.S. cities on median home price, price per square foot, and new listings to see where homeownership is the most achievable for first-time buyers. We looked for cities where the median sale price was closer to the median $200,000 budget of the aspiring homeowner, the cost per square foot was low, and there were more new listings per population.
We found that the best cities for aspiring homeowners are El Paso, Texas, St. Louis, Wichita, Kansas, Philadelphia, and New Orleans. These cities have prices below the national median, and many of them are showing price decreases. In addition to being an affordable market for aspiring homeowners, Philadelphia was one of the most popular cities for Gen Z to move to in 2023.
Full Data
Tips for the First-Time Homebuyer
The homebuying process can feel overwhelming—77% of aspiring homeowners agreed. However, careful planning can help you navigate it confidently. Here are some tips to address the most intimidating aspects:
- Get pre-approved for a mortgage: Understand your budget and secure preapproval early to strengthen your offers. Check to see what options your current bank has. First-time homebuyers may also qualify for specialized loans like FHA loans, which require lower down payments, or VA loans for veterans with no down payment requirements.
- Learn about loans and interest rates: Compare fixed and adjustable-rate mortgages, and use online calculators to see how interest rates impact your monthly payments. Look for programs offering favorable terms for first-time buyers, such as state-backed assistance programs.
- Find a trustworthy agent: Choose an agent with experience, strong reviews, and clear communication. Interview several to find the best fit, especially those knowledgeable about first-time buyer programs. Ask friends and family if they have recommendations.
- Prepare for closing costs: Closing costs typically range from 3–5% of the home price. Request an estimate from your lender, and explore grants or assistance programs designed to reduce expenses for first-time buyers.
Considering cost is the biggest barrier for many aspiring homeowners, finding ways to save in other areas can make the dream of homeownership more achievable. One option after buying your new home is to work with a cheap moving company, which can help minimize relocation expenses while ensuring a smooth transition to a new home.
Expert Tips and Insights
We turned to a panel of experts to learn about their observations of the housing market and what aspiring homeowners can anticipate this year. Read their tips and insights below.
Methodology
The research team at This Old House surveyed 2,000 non-homeowners in the U.S. to determine their aspirations for homeownership, whether they plan to pursue homeownership in 2024, and what barriers to homeownership they currently face. The survey was administered between November 7–9, 2024.
To determine the best cities for aspiring homeowners, the research team analyzed monthly market data from Redfin, a national real estate brokerage. Data were collected in November 2024, with data current up to October 2024. Additional population statistics came from the U.S. Census 2023 American Community Survey 1-Year Estimates. We ranked the 100 most populous U.S. cities on the following metrics:
- Median sale price relative to the median budget of an aspiring homeowner ($200,000)
- Year-over-year change in median sale price from October 2023 to October 2024
- Median price per square foot
- Year-over-year change in median price per square foot from October 2023 to October 2024
- Number of new listings per 1,000 population
- Year-over-year change in new listings from October 2023 to October 2024
Questions about our study? Please contact the author here.
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