Record share of first-time homebuyers paying in cash as Great Wealth Transfer picks up steam

The Great Wealth Transfer is starting to impact the housing market.

A record share of first-time homebuyers are paying for their properties in cash, a sign that more buyers are likely using money they inherited from older generations to help fund their purchases.

Last year, 1 in 10 first-time buyers did an all-cash transaction, according to a new report from the National Association of Realtors, the fourth straight year with an increase, and the largest share since the trade group began collecting data on those transactions in 2003. Among first-time all-cash buyers, 28% reported using an inheritance to help fund their deal, compared with just 9% of first-time buyers who financed.

As home prices hover near all-time highs and mortgage rates stay north of 7% , pricing out many prospective buyers, some portion of those buyers may simply be waiting for an inheritance or other significant help from wealthy baby boomers or members of the Silent Generation.

"It is critical when analyzing first-time buyers to understand there is a growing divide among those who are saving independently and priced out of homeownership, versus those who are waiting on the sidelines but then given a generational transfer of wealth," the report said.

Buyers reliant on wealth transfers look different from those who finance and use their own savings. As modern life expectancy increases, delaying inheritances, first-time all-cash buyers are typically deep into middle age. The median first-time buyer paying all cash is 54 years old, according to the report, significantly older than the median age of 38 for first-time buyers financing their homes.

Claire Boston is a senior reporter for Yahoo Finance covering housing, mortgages, and home insurance.