By Chuck Vosburgh, Realtor, NextHome Gulf to Bay
Home sales are up substantially but there’s something missing – first time home buyers. Normally, first time home buyers represent about 40% of primary home purchases. This year they represent 32%, the lowest number since 1987 when first time home buyers represented 30% of the market.
Low interest rates and a healthy job market would mean more first time home buyers, but there are a number of obstacles facing today’s first time buyer. According to the Nationals Association of Realtors, 25% of would-be first time home buyers reported saving up for a down payment was the biggest obstacle. Increasing rents and debt conspire to keep many out of their first home. 58% reported that student loans are delaying their ability to save so they are waiting until their debt is at a more manageable level. With a median student debt of $25,000 combined with high consumer debt, for many it will take years.
So who’s buying?
Most buyers are people taking advantage of high values on their homes and using the equity for down payments to trade up or down. Married couple represent 67% of buyers with their higher purchasing power. Married repeat buyers have the highest income among buyers with an average of $108,600.
Home values are expected to continue to rise and interest rates are predicted to remain low keeping existing home owners in a good position to purchase their next home. For first time buyers, the best course of action is to reduce debt as quickly as possible and begin saving.
Want to know what your purchasing power is? Have questions? Just ask. It’s free and no strings attached. Call 727.743.1740 or email Chuck@VosburghandVosburgh.com