NAR: First-time homebuyers continue to decline
Posted on Thursday, November 6, 2014 at 8:53:49 AM
No matter the regional housing market, a higher number of first-time buyers is often considered a good thing by experts. However, fewer people are taking the plunge today, and recent research from the National Association of Realtors showed that trend could be holding back the recovery.
Thus far in 2014, only 33 percent of all home sales were attributed to first-timers, according to NAR. That is down 5 percent from last year, and only slightly above the lowest share since 1987, of 30 percent.
"Rising rents and repaying student loan debt makes saving for a down payment more difficult, especially for young adults who've experienced limited job prospects and flat wage growth since entering the workforce," explained NAR chief economist Lawrence Yun.
In an interview with Massachusetts-based media outlet WWLP, New England's regional vice president of NAR Gary Rogers pointed to home prices as a big reason why first-time buyers aren't entering the market. He explained that there aren't enough homes in the right price range at the moment.
Even so, he recommended that buyers try to limit credit card debt and save extra cash before buying a home for the first time. A large down payment can attract lenders and compliment low residential financing rates.