Why did home buyers suddenly grow six years older in one year?

For nearly a decade, 39 has been the median age for home buyers. This year, the median age jumped to 45 years.

The sudden aging may be a one-year anomaly, the result of the rapid decline of first-time buyers who sank from 50 to 37 percent of all home buyers as the as a result of the expiration of the first time buyer tax credit last year. First-time buyers are considerably younger-31 years old on average-while repeat buyers average 53 years according to the 2011 National Association of Realtors’ Profile of Home Buyers and Sellers.

If the older age sticks, however, the ramifications for the housing market could be serious. As buyers delay their first purchase, they diminish demand for starter homes, which makes it more difficult for growing families in need of more space to sell and move into larger quarters.

Last year, for example, the typical first-time buyer purchased a 1,570 square foot home costing $155,000; the estimated median monthly mortgage principal and interest payment was $794. The typical repeat buyer was 53 years old and earned $96,600, notably higher than the $87,000 median reported in the 2010 profile. Repeat buyers purchased a median 2,100 square foot home costing $219,500, with an estimated median payment of $1,006.

A number of signs suggests that the home buying population has been aging.

Between the ages of 25 and 34 is prime time when many people form households with a spouse, partner, roommate, or by themselves, then start families and buy their first home. During and after the recession, household formation dropped for this age group, and more of them than ever are living with parents or other adults rather than renting or owning their own place. In the past three years, the rate has dropped from 1.7 million units per year to below 500,000 currently. These folks will wait to form their own households and consider homeownership only when their job prospects improve.

A key measure for housing demand and homeownership is the unemployment rate for this group and the share of this age group that is employed. As unemployment remains historically high – particularly youth unemployment, which in the United States is above 18 percent among 15- to 24- year-olds – a growing segment of the population is delaying its earliest ventures into the housing market. As more twenty-somethings remain in their parents’ homes or stay with roommates longer before heading out on their own, the bottoming household formation rate begins to anticipate pent-up demand for housing.

Last month, the unemployment rate for 25-34 year-olds rose to 9.8 percent from 9.7 percent in September and is at its highest level since December 2010. The unemployment rate for all adults, in contrast, fell from 9.1 percent to 9.0 percent. In October, 73.5 percent of 25-34 year-olds were employed, down from 73.7 percent in September and 73.9 percent in August. Before and during the boom, almost 80 percent of this age group was employed. The job market remains tough for this key age group: before the recession, unemployment for 25-34 year-olds followed the overall rate pretty much exactly, but has remained stubbornly above the all-adults rate even as the unemployment rate has drifted down slowly, according to Trulia Insights.