Buyers on their first go at home ownership are a product of their surroundings today – budgets burdened by college debt and mounting prices (and, now, rates), with the inability to save. With the barely-there headway in inventory, many are simply spinning their wheels.
“With the lower end of the housing market – smaller, moderately-priced homes – seeing the worst of the inventory shortage, first-time home buyers who want to enter the market are having difficulty finding a home they can afford,” says Lawrence Yun, chief economist at the National Association of REALTORS® (NAR). “Homes were selling in a median of three weeks and multiple offers were a common occurrence, further pushing up home prices. These factors contributed to the low number of first-time buyers and the struggles of would-be buyers dreaming of joining the ranks of home ownership.”
Against the challenges, however, first-timers are not all that different from other generations of home buyers, according to the Profile of Home Buyers and Sellers from NAR, newly released for 2018. When compared to all buyers as a group, and home buyers in a repeat scenario, first-time home buyers are also:
- Likely to accumulate a down payment through personal savings
- Likely to enlist the help of a REALTOR®
- Likely to house-hunt online
- Likely to be married
- Likely to purchase a single-family
Another common trait? Buyers, including first-timers, are encumbered by their loans. Thirteen percent of buyers are challenged the most by the down payment, and for half of them, college debt is keeping them from saving for it, according to the research. (Twenty-four percent of buyers have college debt – a median $28,000 – and 40 percent of first-timers are weighed down by it, at a median $30,000.)
As for those who can amass enough for a down payment? Whether a first- or seven-time home buyer, there’s a similarity: cash to spare. According to the research, first-timers put down 7 percent this year, up from 5 percent, while repeats put 16 percent toward their purchase this year, up from 14 percent.
Facing the challenges of first-time home buying? We’d love to help. The Seay Realty Group is dedicated to service and exceeding your expectations. Call us today!