Here’s the bad news: In 2016, the typical home cost just $233,800, which is nearly 80% lower than in 2025, when the median price registered at $414,400, according to NAR data.
At the same time, there are roughly 470,000 fewer for-sale homes today than there were in 2016, when the national inventory reached 1.65 million properties.
Looking at home sales, there were 5.54 million closings in 2016, compared to just 4.06 million last year, which represents a 1.39 million drop.
The steep decline in sales should come as little surprise considering the surging borrowing costs, with mortgages rates climbing from 3.7% in 2016 to 6.6% in 2025, significantly eroding homebuying affordability for households.
“Although the homeownership rate is higher today than in 2016, boosted by pandemic-era demand and historically low financing costs, entering the market remains a challenge for many households,” says Realtor.com Senior Economic Research Analyst Hannah Jones.
Against this backdrop of intensifying financial headwinds, the median age of the typical first-time homebuyer in the U.S. reached a record high of 40 last year, up from 32 in 2016.
“It comes down to affordability. Higher home prices, higher mortgage rates, and limited entry-level supply mean it takes longer to afford a first home,” says Evangelou. “These buyers aren’t opting out, but they are being pushed to buy later.”