This Is What a First-Time Homebuyer Looks Like
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Version 0 of 1. First-time homebuyers are back, but who are these people? At the beginning of the year, the folks at Realtor.com predicted that Millennials -- especially those aged 25 to 34 who entered the job market during the financial crisis -- would constitute the bulk of first-time buyers this year. Not only has that turned out to be the case, but those Millennials helped make first-time homebuyers 33% of all homebuyers in June. That's the highest percentage since July 2012 (34%). Through the first six months of 2016, first-time homebuyers have represented an average of 31% of all homebuyers, up from 30% for all of 2015. Low mortgage rates deserve some of the credit. According to Freddie Mac, the rate for a 30-year, conventional, fixed-rate mortgage decreased to 3.48% by the end of July. That's down from 3.60% in May to 3.57% in June. Mortgage rates have now fallen four straight months and in June are the lowest they've been since May 2013 (3.42%). They're also below the 2015 average of 3.85%. "The modest bump in June sales to first-time buyers can be attributed to mortgage rates near all-time lows and perhaps a hopeful indication that more affordable, lower-priced homes are beginning to make their way onto the market," says Lawrence Yun, chief economist for the National Association of Realtors. "The odds of closing on a home are definitely higher right now for first-time buyers living in metro areas with tamer price growth and greater entry-level supply — particularly areas in the Midwest and parts of the South." |