The average first-time homebuyer is now 40, the oldest on record, yet buying this late can leave you $150K behind in equity. Is it still worth it?

Even more concerning, NAR estimates that delaying a first home purchase until age 40 rather than age 30 could cost you about $150,000 in lost starter-home equity (2).

What’s going on?

Traditionally, first-time homebuyers were in their late 20s or early 30s (1, 2). But the climb to the age of 40 reflects larger pressures: higher home prices, steep mortgage rates and limited affordable inventory. Starter homes are in short supply or overpriced. First-timers made up only 21% of home purchases in 2025, the lowest on record (1).

Affordability is another hurdle. First-time buyers had a median household income of $94,400 in 2025, well above the national median of about $81,600. That suggests only higher-earning households are managing to break into homeownership (2).

Then there’s the down payment. The median for first-timers hit 10% in 2025, the highest since 1989 (3). On top of that, 37% of first-time homebuyers carried student loan debt, which can push back timelines or lower purchase budgets (4).

Why it matters

The estimated $150,000 in lost equity isn’t just a number. It represents missed years of appreciation, mortgage paydown and compounding gains. Every year you wait, there’s less time for your home to grow in value alongside you.

Jessica Lautz, NAR’s deputy chief economist and vice president of research, says that today’s first-time buyers may build less housing wealth over their lifetimes and likely make fewer moves as a result (3). Buying later can also mean carrying your mortgage into your retirement years. With fewer years to benefit from market growth, that can be a financial strain if the purchase acts more like a lifestyle decision than a wealth-building one.

How to decide if buying at 40 or older is worth it

If you’re approaching 40 and considering homeownership for the first time, here’s how to think it through:

• Start with lifestyle, not just investment. Buying later is often about stability, location and comfort more than big equity gains. If your primary goal is building wealth, know that the clock started earlier for buyers who purchased in their 20s or early 30s.
• Afford the full cost of ownership. Look beyond the mortgage. Taxes, insurance, maintenance, repairs and utilities all matter, especially with fewer years to spread out expenses.
• Recognize the equity gap. It may be tough to catch up to someone who has had a decade or more of home equity growth. NAR estimates that the gap could be near $150,000, over a lifetime (2).
• Compare renting and buying honestly. If you have low rent and don’t plan to stay long, renting may give more flexibility with less risk. Buying shines when you expect to put down roots and can comfortably handle the costs.
• Keep expectations realistic. Home values don’t always rise quickly. Buying at 40 still gives you years to build equity, just not as many as younger buyers.

Above all, make the decision intentionally. If you buy based on your lifestyle, long-term stability and what you can afford instead of hoping for fast appreciation, homeownership at 40 can still be deeply rewarding. It may not be about beating the market, but about creating a home you love and grow into.

Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

NAR (1); Realtor.com (2); NAR (3); Education Data Initiative (4).