Pandemic Homebuyers: Who Were They, and Where Did They Buy?

Executive Summary

Stable and affordable housing is foundational for participating in the economy, and homeownership is the primary form of wealth accumulation for most American families. Housing demand changed as households responded to the economic and social environment of the COVID-19 pandemic. As households moved because of these changing conditions and homebuying surged, many popular narratives emerged around migration patterns, “hot” places to buy, and what types of buyers were succeeding in the market.

This research brief employs mortgage data from the Home Mortgage Disclosure Act (HMDA) to examine the homebuying patterns of households during this unique housing market, focusing on two key dimensions:

1. Who bought homes (i.e., homebuying trends by buyers’ race/ethnicity, income, and age)?
2. Where were these homes located (i.e., homebuying trends across urban, suburban, small metro, and nonmetropolitan locations)?

The few years of the pandemic and immediate post-pandemic were an unusual moment in the homebuying market. However, patterns during this time could have long-term implications on disparities in homeownership by race/ethnicity, income, and age (and related gaps in asset accumulation and wealth), as well as geographic differences that affect regional housing and labor markets and household budgets.

Key Findings

• The pandemic period ushered in a period of peak homebuying for historically marginalized groups of homebuyers. Buyers of color, low- and moderate-income buyers, and younger buyers all participated in the homebuying market at elevated rates.
• Homebuying in urban areas experienced a modest decline in 2020 relative to other types of locations but rebounded in 2021. At the same time, the pandemic period continued pre-pandemic growth in smaller metropolitan and nonmetropolitan areas.
• Declines in the number of loans originated from 2021 to 2022 suggest that changing market conditions (high prices and interest rates) may have reduced affordability and made it challenging for new homebuyers to enter the market or for existing homeowners to make changes to their housing situations.

Although gains were made from 2018 to 2022 for homebuyers from historically marginalized groups, if tightened conditions related to high prices and interest rates persist, they could stall or potentially reverse pandemic-era gains. Additionally, regional variations in access by marginalized groups may point to additional advantages or constraints in local markets. As market conditions continue to evolve, it will be important to continue to monitor the trends highlighted in this paper.

The views expressed in this report are those of the authors and do not necessarily reflect the views of the Federal Reserve Bank of San Francisco or the Federal Reserve System.