The Dream Delayed — Inside the 2025 Aspiring Homeowners Report

 

The Pain Is Real—And Rising

Imagine saving for years, only to find the market running even faster. That’s the reality for millions of Americans in 2025. A whopping 70% of aspiring homeowners now believe they’ll never afford a home, according to the latest Aspiring Homeowners Report from This Old House. With median home prices at $435,000, and typical buyers budgeting just $200,000, the American Dream has hit a roadblock.

The survey, conducted in late 2024 across 2,000 would-be buyers, unveils a market fraught with price barriers, shrinking inventory, and a deep sense of disenfranchisement.

What Is the 2025 Aspiring Homeowners Report?

The 2025 report combines survey data from This Old House with market trends sourced from Redfin and the National Association of Realtors (NAR). It examines:

• Buyer psychology and expectations
• Price, mortgage, and inventory trends
• Regional affordability
• First-time buyer challenges and behaviors
• Government support demand

Quick Stats:

• Median home price (Oct 2024): $435,000
• Most buyers’ budget: $200,000
• Price gap: $235,000
• Home prices have risen 48% in 5 years
• Inventory has dropped 24%

Key 2025 Insights (at a Glance)

• 70% of aspiring buyers fear they’ll never own a home
• 62% believe the market is biased against first-time buyers
• 43% say they can’t afford a down payment
• 78% want federal down payment support
• Only 16% plan to buy this year
• 41% expect prices to rise even more in 2025

What’s New for 2025?

• 📈 Prices keep rising: The median home sale price climbed from $416,100 (June 2023) to $435,000 (Oct 2024), and shows no signs of slowing.
• 🏘️ Listings down: Available inventory has decreased 24% since 2019, creating fierce competition for the few homes on the market.
• 🧮 Affordability crash: The typical buyer can afford around $200K—while the median home costs double that, highlighting an unprecedented affordability gap.
• 🔐 Confidence crisis: Only 18% believe now is a good time to buy a home, reflecting widespread caution among would-be buyers.

Why This Matters for Buyers, Agents & TCs

For first-time buyers, these trends aren’t just frustrating—they’re decisive. Homeownership shapes wealth, mobility, and financial stability, so being shut out has long-term consequences.

Real estate agents and transaction coordinators: Be prepared to coach more cautious, data-savvy, and stressed-out buyers through this process.

Brokers and lenders: Expect more requests for low-down-payment and government-backed loan products as buyers look for creative financing options.

🧠 Stat of the section: A 20% down payment on today’s median-priced home ($435,000) = $87,000, which exceeds the 2023 U.S. median household income of $77,719.

One figure says it all: $435,000. That’s the median U.S. home price as of October 2024, according to Redfin. Meanwhile, the majority of aspiring homeowners in the 2025 Aspiring Homeowners Report estimate they can afford a home around $200,000. That’s a $235,000 affordability gap—a chasm that’s only grown in recent years.

Since 2014, home prices have nearly doubled, and over the past five years alone, prices have jumped 48%. Supply hasn’t kept pace either. Available inventory has dropped by 24%, creating intense competition for the few homes that remain in reach.

And the pain doesn’t stop at prices.

Interest Rates Compound the Pain

While the report focuses more on pricing than mortgages, buyers aren’t blind to the double whammy of high rates. Roughly 49% cite high mortgage rates as a primary obstacle.

Let’s illustrate: In 2020, a $300,000 home with a 3% mortgage had monthly payments around $1,265. In 2024, the same loan at 7% pushes payments over $2,000—a 58% jump. This sharp rise in borrowing costs has pushed many buyers to the sidelines, particularly those without high incomes or equity from previous homes.

The Down Payment Dilemma

For many, the down payment is the biggest blocker. Nearly 43% say they can’t save enough.

 

Let’s do the math: 20% down on a $435,000 home = $87,000. U.S. median income (2023) is $77,719, over a year’s salary, with nothing left for moving costs, closing, or emergencies. Not surprisingly, 51% of would-be buyers plan to put down less than 20%, but that invites mortgage insurance costs, pushing affordability even further out of reach.

Buyers are taking drastic steps to scrape together savings: 37% are skipping vacations, 23% are taking on side gigs, and many are delaying life milestones to make homeownership possible.

Buyers Want Help—From Uncle Sam

The affordability crisis has ignited support for federal action. A striking 78% of respondents believe the government should provide down payment assistance for first-time homebuyers. This demand reflects not only frustration but an increasing awareness of how systemic factors—like wage stagnation, asset inflation, and policy gaps—are locking a generation out of homeownership.

Emotional Impact: More Than Just Math

This isn’t just about numbers. The emotional fallout is profound:

• 70% fear they’ll never afford a home
• 62% feel the system is rigged against first-time buyers
• Only 18% think now is a good time to buy
• Just 16% plan to purchase within the year

For agents, brokers, and transaction coordinators, this means managing more than just paperwork. You’re guiding clients through high-stress decisions in an unpredictable market. Empathy, education, and creative financing solutions will be key in 2025.

Relocation and Compromise — How Aspiring Homeowners Are Adjusting

Willing to Move, Shrink, and Sacrifice

When affordability breaks down, flexibility takes over. That’s what we’re seeing among 2025 aspiring homeowners. According to the report, 50% don’t believe they can buy in their current area, but most aren’t giving up. Instead, they’re willing to relocate, downsize, and adjust expectations—sometimes dramatically.

Top Willingness Stats:

• 61% are willing to move to a different neighborhood
• 29% would move to a different part of the country
• 55% would accept a smaller home
• 39% are fine with a longer commute
• 36% would give up a yard
• 33% would lower school district expectations
• 21% would consider less safe neighborhoods

But even in this wave of trade-offs, there are limits: Only 15% would consider buying in a high natural disaster risk area, even for a good deal.

 

These figures underscore a growing realism among buyers—but also a willingness to get creative to make ownership work.

Best Cities for Aspiring Buyers in 2025

Not all housing markets are created equal. The research team behind the report analyzed Redfin’s October 2024 data across the 100 most populous U.S. cities. They ranked cities by:

• Median home price vs. $200K buyer budget
• Price per square foot
• Year-over-year pricing trends
• Volume of new listings per 1,000 residents

Rank	City	Median Sale Price	Price/Sq Ft	Inventory Advantage
1	El Paso, TX	$250,000	Low	High
2	St. Louis, MO	Below U.S. median	Moderate	Stable
3	Wichita, KS	Well under $200K	Very Low	Increasing
4	Philadelphia, PA	Below median	Moderate	Price softening
5	New Orleans, LA	Below median	Moderate	Improving

📌 Philadelphia also ranked high for Gen Z migration in 2023, showing growing popularity among younger buyers.

These cities combine affordability with inventory fluidity, offering genuine buying opportunities—especially for remote workers or flexible movers.

Why This Data Matters for Agents, TCs & PropTech Pros

Real estate agents: These shifting patterns mean cross-market referrals and relocation expertise will be crucial.

Transaction coordinators: Expect more multi-state transactions and increased document volume for relocation deals.

Brokers and tech platforms: It’s a great time to build tools that help buyers compare cost of living, neighborhood crime rates, and commute times.

Expert-Approved Tips for First-Time Homebuyers in 2025

Buying Your First Home? Start Here

The 2025 Aspiring Homeowners Report didn’t just highlight problems—it also spotlighted solutions. And with 77% of would-be buyers feeling overwhelmed by the homebuying process, expert advice is more critical than ever.

Here are practical, proven tips from finance professors, consumer experts, and seasoned pros that can help you—and your clients—make smarter moves in this high-pressure market.

1. 1. Get Pre-Approved—Now
      Why: It helps buyers understand their budget, narrows their home search, and strengthens offers.
      💡 Bonus Insight: Some lenders offer rate-lock programs during pre-approval—especially helpful if rates are climbing.

 

1. 1. Explore First-Time Buyer Loan Programs
      Why: You don’t always need 20% down. FHA, VA, and USDA loans often require less—sometimes zero down.
      ✅ FHA: 3.5% down
      ✅ VA: No down payment for qualified veterans
      ✅ USDA: 0% down in eligible rural areas
      State-specific programs may also offer grants or forgivable loans. Many agents overlook these—don’t.

 

1. 1. Compare Interest Rates, Not Just Homes
      Why: A 1% rate difference can mean hundreds in monthly savings. Buyers should shop across lenders, use calculators, and know the difference between fixed and adjustable-rate mortgages.
      🛠️ Use tools like NerdWallet, Bankrate, or local credit union platforms.

 

1. 1. Find the Right Agent—And Interview Them
      Why: A good agent isn’t just a door-opener—they’re a guide through bidding wars, forms, and market trends.
      🔍 Ask about experience with first-time buyers
      📚 Ensure they understand financing options
      📣 Check their local reputation or reviews

 

1. 1. Prepare for Closing Costs
      Why: These often surprise buyers. On average, closing costs run 3–5% of the home’s price—that’s $13K–$21K on a $435K home.
      🧾 Tip: Request a closing disclosure early and compare service provider fees.

 

1. Don’t Forget the Move
   Why: Budgeting for your down payment is critical, but so is moving day.
   💰 Pro tip: Many first-time buyers save $1,000+ by using affordable moving companies—especially important if they’re relocating across cities or states.

 

How Experts View the Market

“The biggest hurdle is still affordability, but knowledge and strategy make a massive difference.” — Rebel Cole, Ph.D., Professor of Finance, Florida Atlantic University

“First-time buyers need both information and support. Agents and lenders must educate more aggressively.” — Ying Huang Johnson, Ph.D., University of South Alabama

“Don’t be discouraged. This market is hard, but not impossible. Stay flexible and focused.” — Melanie Jewkes, Utah State University Extension

Why It Matters and What’s Next for the Industry

Why This Report Matters for the Real Estate Ecosystem

The 2025 Aspiring Homeowners Report isn’t just another snapshot—it’s a warning shot. When 70% of would-be buyers fear they’ll never own a home, the market needs more than sales tactics. It needs strategy, education, and empathy.

For every stakeholder in real estate, here’s what’s at stake:

🧑‍💼 Agents & Brokers:
Clients are more cautious, emotional, and well-researched than ever.
Buyer education and transparent pricing discussions are non-negotiables.
Cross-regional and affordability-focused marketing is key to survival.

🧾 Transaction Coordinators:
Prepare for more out-of-state deals and digital-first processes.
TCs can offer a calm, compliance-focused center amid growing complexity.
Mastering local assistance programs and coordinating timing across lenders will be a competitive edge.

💼 PropTech Builders & VC-backed Startups:
There’s a clear gap for platforms that match buyers to affordable homes + down payment help.
Relocation calculators, rent-vs-buy tools, and financing eligibility engines are more valuable than ever.

Detailed Insights and Trends to Watch

Trend	Implication
Home prices outpacing income	Down payments unaffordable without outside assistance
Increased buyer flexibility	More buyers willing to relocate, commute, or downsize
Gen Z and Millennials dominant	Need for mobile-first tools and digital mortgage guidance
Government intervention demand	Expect policy debates around housing vouchers and grants
Emotional fatigue among buyers	Buyer burnout may affect deal flow and timeline expectations

FAQs

1. 1. What is the biggest obstacle to buying a home in 2025?
      High prices. 70% of aspiring homeowners cited pricing as their top concern.

 

1. 1. How much should I save for a down payment?
      Ideally 20%, but most respondents in the report plan to put down less—closer to 5–10%. Assistance programs can help.

 

1. 1. Is now a good time to buy?
      Only 18% of respondents think so. If you find a stable-rate mortgage and favorable local conditions, it can still make sense.

 

1. 1. What cities are best for first-time buyers?
      El Paso, St. Louis, Wichita, Philadelphia, and New Orleans stood out for affordability, price trends, and active listings.

 

1. Can I buy with less than 20% down?
   Yes—FHA, VA, and USDA loans offer low or no down payment options, especially for first-time buyers.

Resources & Further Reading

• National Association of Realtors (NAR)
• Redfin Housing Data Center
• HUD First-Time Buyer Programs
• ReBillion’s Real Estate Blog
• ReBillion.ai Transaction Coordination Tools

Conclusion & Soft CTA

Buying your first home in 2025 may feel overwhelming—but you’re not powerless. With the right data, a proactive strategy, and expert support, your homeownership dream doesn’t have to be delayed forever. Whether you’re a buyer, agent, or transaction coordinator, staying informed is your first step toward getting ahead.

Explore more insights, checklists, and tech tools at ReBillion’s Blog or visit ReBillion.ai to see how we’re simplifying real estate for everyone.