First Time Home Buyers Face Challenges
By Nick Nayne
According to the National Association of Realtors most recent annual survey of homebuyers, the percentage of first-time homebuyers is at the lowest point since 1987. The historic average of homebuyers identifying themselves as first time homebuyers was 32 percent, whereas the historical average is about 40 percent. On a national level, seasonally adjusted housing starts in October were the lowest in 7 months and lower than 1 year ago.
These national figures are indicative of the challenges facing new homebuyers. The lack of new affordable construction is an important factor. We are continuing to face tight inventories and falling rental vacancy rates, which one would expect to be motivation for building activity to increase.
The low rental vacancy rates and accompanying high rents are making it difficult for first time buyers to save for a down payment. Many of these first time homebuyers also have student loan debt. Paying back this debt with stagnant wages, rising rents, and anticipated interest rate increases, explains why the number of new rental households has exceeded the number of new homeowners.
Despite the lag in new housing starts, the good news is that more existing homes are expected to come on the market as existing owners realize their recent equity gains and decide to move up to a new home. The market is expected to still grow next year and demand is expected to increase new home building. Hopefully housing starts will also increase for 2016.
Nick Nayne is the principal broker for The Broker Network, LLC.
Home Price Round-up
2808 NE Cordata, Bend, OR 97701
3 beds, 2 baths, 1354 square feet, .20 acre lot
Built in 1985 | $164,999
Listed by Allison James Estates & Homes
MID 19704 SW Poplar St, Bend, OR 97702
3 beds, 2 baths, 1426 square feet, .30 acre lot
Built in 1988 | $329,900
Listed by Investwest Commercial
19692 Hollygrape St, Bend, OR 97702
4 beds, 3.5 baths, 3791 square feet, .36 acre lot
Built in 2006 | $874,000
Listed by Cascade Sotheby's