Housing Slowdown Doesn’t Scare First-Time Buyers

Despite recent declines in home sales, sluggish growth in single-family home construction, and mounting affordability concerns, first-time buyers are outperforming other segments of the market, according to a new report released by Genworth Mortgage Insurance. “The first-time home buyer market has been more resilient during the [housing] slowdown compared to repeat buyers,” writes Tian Liu, chief economist at Genworth Mortgage Insurance.

About 482,000 first-time buyers purchased homes in the fourth quarter of 2018. Though that’s 3 percent lower than a year ago, it bests the 7 percent year-over-year decline in repeat buyer activity, according to the report. “This is a reminder that first-time home buyers differ from other buyer groups in terms of why they buy,” Liu notes. “Their purchase decisions are more likely driven by the fact that many are starting families and reaching peak homebuying ages. Even when they face common challenges such as falling affordability, first-time home buyers and repeat buyers may respond differently, as demonstrated by first-time home buyers’ outperformance.”

First-time buyers accounted for 56 percent of mortgage borrowers in the fourth quarter of 2018 and 39 percent of buyers in the overall home sale market, according to the report. They made 2.07 million home purchases in 2018—higher than their pre-recession level.

Home buyers are still increasingly concerned about affordability and rising home prices. However, sales of lower-priced homes reportedly grew nationwide in the fourth quarter as buyers looked for more affordable options, the report notes. “Looking at the full year and the longer term for the first-time home buyer market provides more reason for optimism,” Liu notes. “There remains a large number of ‘missing’ first-time home buyers who have not returned to the market in the aftermath of the housing crisis, and many young people are reaching their peak homebuying ages now, leaving them poised to buy over the coming years.”

 

I read this article at: Reatlor Magazine

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Sabrina Caton - The Caton Team Realtors

Sabrina & Susan are native Californians - born and raised in the Silicon Valley with a passion for Residential Real Estate. A mother and daughter-in-law duo called - The Caton Team. With over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time. Call | Text at: 650-799-4333 | Email Info@TheCatonTeam.com The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true. The Peninsula is our backyard - let us help make it yours. We represent Buyer’s and Seller’s throughout the Bay Area. The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?

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