Can You Buy a House in Your 20s?

Last year, while Whitney Buehler was in Croatia on her honeymoon, the back of her mind was home in Atlanta gearing up for a summer of house hunting.

Ms. Buehler, 25, and her husband, Joey, 27, didn’t like renting, and had discussed the idea of buying a home for two years before getting married.

Throughout the pandemic, they had put aside around $40,000 in savings and kept an eye on the chaotic housing market. With their wedding out of the way, they finally had the time and energy to dive into their search head-on. After touring 15 houses, the Buehlers placed three offers before one was accepted.

The property was a fixer-upper in the Ormewood Park neighborhood of Atlanta’s Eastside. It cost $389,000 and ticked all of their boxes. It was right off the BeltLine, a network of trails that Mr. Buehler uses to bike safely to work. It had a verdant yard filled with tulip poplars and three majestic oaks. It had two bathrooms. The couple moved in last August.

The Buehlers are part of an enviable cohort of young adults who manage to become homeowners before the age of 30. Reaching such a milestone can feel like a tall order these days. The typical age of a first-time home buyer is 36, according to a recent survey from the National Association of Realtors. When the survey was first taken in 1981, the median age for first-time buyers was 29. Home prices surged in the first two years of the Covid-19 pandemic, and in recent months fell only slightly from those peaks.

The cost of renting has skyrocketed in many cities, eroding the ability of tenants to save. Add other forces — like high student loan debt and wages that haven’t kept up with inflation — and it’s no surprise that young adults appear to be renting for longer and becoming homeowners later, if ever. But against these odds, many are still making it happen. Twenty-nine percent of adults between the ages of 18 and 29 owned their homes in 2021, the Federal Reserve found.

Good old-fashioned saving is generally not enough to afford a home in your 20s. That is especially true for young people just starting out in their careers. Those who do manage to buy before 30 often get help from family or have high-paying jobs. But some are finding other paths to homeownership by settling down in lower-cost-of-living areas or tapping into programs that help reduce down payment costs for qualifying buyers.

For Ms. Buehler, becoming a young homeowner was made possible in large part because of a $40,000 inheritance from her great-grandfather. It was earmarked for college tuition, but because she paid her way through school with scholarships and part-time work, most of that money went untouched.

The inheritance covered half of the down payment. Ms. Buehler and her husband split the rest, prorating their contributions according to income. Her husband is studying for a doctorate in biochemistry, cell and developmental biology, and Ms. Buehler is an engineer for the Environmental Protection Agency. Her salary alone covers their monthly mortgage payments and bills.

Wealth-Building Through Homeownership

For renters, housing costs can fluctuate wildly from year to year, especially in places where landlords can increase rent without limits. Homeowners often opt for fixed-rate mortgages, which effectively lock in their cost of housing for decades and can insulate them from volatile economic cycles, said Jung Choi, a senior research associate at the Urban Institute, a think tank.

People who buy their first home before they’re 35 accumulate significantly more wealth by the age of 60 than those who do so afterward, a 2018 analysis by the institute found. “At an age near retirement, you actually have built your wealth for a longer period of time,” Ms. Choi said. The earlier you buy your home, the more time it has to appreciate in value, and the more time you have to pay down mortgage debt.

Homeownership as an engine for wealth-building is what Desiree Gaeta had in mind when she bought her first house at 27, in the summer of 2020. At the time, Ms. Gaeta, who was working as a nurse, gleaned what she could about the power of homeownership through her colleagues. Her parents hadn’t become homeowners until middle age, so she wondered if she could do so in her 20s.

A nurse who also worked as a real estate agent explained to Ms. Gaeta how to estimate what she could afford. For years, Ms. Gaeta had been putting money in a savings account and was surprised to learn that she had enough for a down payment on a house in Charlotte, N.C. As a first-time home buyer, she qualified for a Federal Housing Administration loan, a government-insured mortgage that required Ms. Gaeta to put only 3.5 percent down, based on her credit score.

She bought a newly built four-bedroom, two-and-a-half-bathroom starter home…