The housing market has changed dramatically over the last 60 years. Here is what you should know about the past and present state of the market.

The summer after finishing middle school, I remember being excited that my mom wanted to become a homeowner. Whenever we visited the grocery store, my eyes lit up when I saw real estate magazines. I would share the homes I liked with my mom, hoping she’d pick my favorite one.

My mom eventually bought a home right before my freshman year of high school, with the help of a real estate agent. I loved having my own room and a larger backyard. When I grew up, I wanted to be a homeowner just like her.

But almost two decades later, I’ve chosen to be a renter instead because I want to save up 20% for a down payment in order to avoid private mortgage insurance. Saving up that amount of money is tough, especially since home prices have increased over the decades.

In addition to the price of homes rising, home buying has changed in other ways since my mom purchased her home. And I’m sure things weren’t the same when my grandma purchased hers, almost 60 years ago.

Today, I’ll cover how the home buying process has changed throughout the years.

The median price of homes

From Increased Prices To The Rise Of Homebuying Technology - How Homebuying Has Changed Over The Last 60 Years - The median price of homes

While looking at median price data from the Federal Reserve, I was shocked to see how much home prices have skyrocketed since 1963. During the 1960s (1963-1969, to be exact), the median price of homes sold was $21,450. By contrast, the median price of homes sold from 2010 to 2019 was $289,150.

That represents almost a 1,350% increase. Is there any wonder why some of us youngsters are delaying the purchase of a home? For many of us, it’s unaffordable.

But you have to keep in mind that our grandparents didn’t earn the same wages you and I do now. After doing some digging, I found that the median income of families in 1960 was $5,600, according to the Census Bureau.

Back in 2018, the median income for families was $64,324, according to Census data. That represents almost a 1,150% increase from the median income in 1960, so home prices should be almost as affordable, right?

In some cases, that might be true. But it’s hard to afford the price of a home nowadays if you’re one of the millions of Millennials who struggle to pay student loan debt. Some students have student debt that is half the median price of mortgages!

DecadeMedian price of houses sold in the U.S.

*Based on data from the Federal Reserve

Are you curious to see if you can afford a home now? I recommend using MU30’s home affordability calculator

Changes in interest rates

While looking at data from Freddie Mac, I saw that the 30-year fixed mortgage rate also fluctuated over the past 60 years. Unlike home prices, though, they’ve been mostly trending downward with each decade, except for the 1980s.

In the 1980s mortgage rates were sky-high — the average was 12.702% for the decade. I’m talking credit-card-rate high. The 30-year fixed mortgage rate peaked at 18.45% in October of 1981. 

This was so shocking that I had to use MU30’s simple mortgage calculator to estimate my monthly payments with a rate that high. If I were alive to purchase a house then at the median price of $81,900, my estimated loan payment would be $1,110.03. Even with a $10,000 down payment.

But let’s play revisionist history. If I got an interest rate of 3% during that time period, my estimated loan payment would be $496.53. Interest rates matter. A lot

Higher rates made it a lot more expensive for homebuyers to purchase a home in that time period.

These high rates led to a U.S. recession. After the recession ended in 1982, mortgage rates started trending downward again.

As each new decade passed by, there was a drop in the average 30-year fixed mortgage rate. For example, the average mortgage rate dropped from 8.8118% in the 90s to 6.292% in the 2000s. It dropped almost two points again in the 2010s — from 6.292% to 4.092%.

DecadeAverage 30-year fixed mortgage rate

*Based on data from Freddie Mac

In 2020, the average 30-year fixed mortgage was 3.11%. The low-interest-rate environment we’re in now makes purchasing a home more affordable for some of us. I can’t imagine having to pay an interest rate in the teens!

Age of first-time homebuyers, repeat homebuyers, and all homebuyers

From Increased Prices To The Rise Of Homebuying Technology - How Homebuying Has Changed Over The Last 60 Years

Another thing that has changed over the last 60 years is the median age of homebuyers. The National Association of Realtors has data on this that goes back as far as 1981. It breaks it down into sections: first-time homebuyers, repeat homebuyers, and all homebuyers.

Before looking at their graphs, I assumed the median age for the first-time homebuyer increased a lot in four decades because younger people were delaying buying their first home. But this assumption was wrong. While the median age for first-time homebuyers has changed, it hasn’t changed that much.

From 1981 to 2018, the median age only fluctuated between 28 and 33. It peaked at 33 in 2019.

However, the median age of repeat homebuyers increased from 36 in 1981 to 55 in 2019. Buyers have been waiting longer to purchase their second homes. This, of course, pushed up the median age of all buyers. 

Recent generational trends

Since The National Association of Realtors started publishing its data on generational trends, Millennials have continued to represent a large percentage of homebuyers each year.

In 2012, Millennials represented 28% of homebuyers and that percentage reached a high of 38% in 2019. Afterward, it fell back down to 37% in 2020.

YearMillennial homebuyers

*Based on data from The National Association of Realtors generational reports

Though Millennial representation has risen, it’s important to note that some Millennials still struggle to save for a down payment or purchase a home. What’s their biggest struggle?

According to NAR’s most recent generational report, 48% of 22- to 30-year-olds and 41% of 31- to 40-year-olds said student loans were holding them back. The other culprits listed were credit card debt, car loans, and high rent payments.

I can relate to that. For the longest time, I struggled to save money while paying a car loan and credit card debt. 

Down payment percentage

Over the last 30 years, the median down payment amount has fluctuated. According to data from the National Association of Realtors, the median down payment percentage peaked at 20% in 1989. Afterward, it went down, before rising again to 19% in 2001. It dropped again after that and hit 12% in 2019.

How did first-time homebuyers come up with the money for the down payment? The same report shows that 32% of these buyers received a gift or loan from a family member or relative.

This is an advantage that some people, like myself, don’t have. But there are down payment assistance programs out there to help.

Also, if I took out an FHA loan, it would only require a 3.5% down payment. However, this would require that I pay a mortgage insurance premium for the life of the loan unless I refinanced.

The rise of single homebuyers

Another disadvantage when it comes to buying a home is having one income. Over the last 60 years, there has been a rise in the percentage of single homebuyers, according to Haus. The percentage was around 18% in 1960. Since then, it has more than doubled to 38.4%.

Types of mortgages

When my mom purchased a home, she got the most popular mortgage term at the time: a 30-year fixed-rate mortgage. This type of mortgage was introduced by the Federal Housing Administration in the 1930s. It remains the most popular type of mortgage.

While doing some research, I discovered adjustable-rate mortgages (ARMS) became popular nationwide in the 80s. Unlike fixed-rate mortgages, these mortgages are tied to a benchmark rate. The mortgage rate rises and falls based on the benchmark rate and terms of the loan.

How technology has changed the home buying process

From Increased Prices To The Rise Of Homebuying Technology - How technology has changed the homebuying process

When my mom purchased her home in the early 2000s, computers existed, but they weren’t everywhere like they are now. And during the pre-internet days, homebuyers had limited options when searching for homes. They could cruise around looking for “for sale” signs, connect with a realtor, or flip through real estate magazines.

It was more time-consuming to get important information, like how much a home was worth and the history of its price changes and ownership.

Now, instead of flipping through a magazine, I can use the power of the internet in my pocket to search for houses instantly. By using sites like Zillow and Redfin, I can just type in a city and find houses in my desired area. I can also filter my search by price, property type, or even number of baths.

According to a 2019 digital report by the National Association of Realtors, 80% of my fellow Millennials use their mobile devices to find a home.

It’s now possible to purchase a home completely online, without stepping foot into the house. Nowadays, instead of visiting the home physically, some homes on the market have virtual walkthroughs. This saves homebuyers time and money. 

Technology hasn’t replaced real estate agents

Although technology has transformed the home buying process, one part of it remains the same: the use of a real estate agent. According to a 2021 NAR report, 88% of buyers used an agent. The percentage was even higher for those 30 and younger: 91%. 

Real estate agents were used to help negotiate the price and terms of the home purchase.


Over the last 60 years, the home buying process has gone through a lot of changes, but some things have remained the same. For example, the median price of homes has skyrocketed, but at the same time, interest rates have gone down, after sharply rising in the 80s.

These changes, especially the large increase in the median home prices, make it more important than ever that you learn how to save money and build wealth today. After all, the market could shift in the blink of an eye and is likely to look completely different 60 years from now. 

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About the author

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Jerry Brown is a personal finance writer based in New Orleans, LA who has been writing about personal finance for four years. He first started writing about this topic after creating his own personal finance blog, Peerless Money Mentor. Two years later, he decided to pivot away from writing for his blog to chase his dream of writing for major publications. Doing so has helped him land freelance writing gigs with personal finance brands such as Forbes Advisor, Bankrate, Rocket Mortgage, and LendingTree. If you want to connect with him, you can add him as a friend on LinkedIn or Twitter. To view more of his writing, check out his Muck Rack profile.