The increase in homebuyers’ income has never moved higher or faster, and now sits at $107,000, according to a new report from National Association of Realtors.
The buyer income annual increase was 22% from $88,000 last year. This comes as home prices and mortgage rates continue to rise. It is based on tracking transactions between July 2022 and June 2023.
“Given the erosion of housing affordability due to higher home prices and mortgage rates, the household income for those who successfully purchased homes jumped by nearly $20,000 and topped six figures for only the second time in our records,” Jessica Lautz, NAR deputy chief economist and vice president of research, said in prepared remarks.
“In a still-competitive housing market, more well-off home buyers were able to have their bids accepted by offering larger down payments and even by paying cash.”
The report also showed a recovery in the percentage of first-time homebuyers following last year’s historic low.
In this survey, 32% of all home buyers were first-timers, up from last year’s 26%. It is still below the 38% annual average since 1981.
“First-time buyers tiptoed back into the market this year with less competition and fewer multiple-offer scenarios,” Lautz said. “While the share of first-time buyers is still near historic lows, it is higher than last year. Notably, today’s first-time buyers had household incomes nearly $25,000 above last year and are more likely to use financial assets to enter the market.”