Please wait as we prepare your PDF file ....

Mission Chronicle Blog

Search Blog

our goal is to help you stay informed by providing timely and interesting articles.

How much down payment is required to buy? NAR aspiring buyer profile shows most don’t know

02/06/2017

Download PDF

The National Association of Realtors (NAR) released its 2016 Aspiring Home Buyer Profile, which revealed one of the top barriers would-be homebuyers face — misconceptions about down payments.

According to NAR’s Profile of Home Buyers and Sellers, the median down payment for first-time homebuyers has been 6 percent for the past three years.

But when aspiring buyers were asked what down payment was required to purchase a home for the aspiring buyer profile, 87 percent of them said a payment of 10 percent or more was required.

“Current non-owners’ ultimate goal of owning a home may not be as far-fetched as they believe,” said NAR President William E. Brown in a statement.

“There are mortgage options available for creditworthy borrowers with manageable levels of debt and smaller down payments. Those interested in buying their first home in 2017 should review their finances, sit down with a lender to see if they qualify for a mortgage and find a Realtor to help them get started on their home search.”

Beyond a lack of knowledge about down payment and mortgage options, would-be buyers are struggling to find affordable housing and balance the costs of owning a home with student loan repayment.

“In addition to having to postpone important milestones such as getting married and starting a family, many young adults are financially falling behind previous generations in part because of having to prioritize repaying their sizeable student loans over buying a home and saving for retirement,” said NAR Chief Economist Lawrence Yun in a statement.

More than half of non-owners say they can’t afford a home, while another 20 percent said they need the flexibility of renting. Moreover, 59 percent said they aren’t comfortable with taking on a mortgage while trying to pay off student loan debt, with nearly 50 percent saying the loans will delay their homeownership goals by five years.

These barriers have dampened would-be buyers and even current homeowners’ optimism about buying a home. The share of would-be buyers who thought it was a good time to buy dropped 8 percentage points to 55 percent, and homeowners’ optimism about buying a home dropped, but still remained around 80 percent.

“Nearly all non-homeowners said they want to own a home in the future (87 percent), but it’s evident that higher rents and home prices — up 41 percent in the past five years — along with limited entry-level supply and repaying student debt have combined to make buying a challenging goal,” Yun said.

“It’s also little surprise that non-owners in the West — where price appreciation has been the strongest — were the least optimistic about buying.”

Despite these barriers and dampened optimism, 80 percent of aspiring buyers and 90 percent of owners still believe owning a home is an integral part of the American Dream.

Email Marian McPherson

Source: click here

Read More

INSPIRED, INTELLIGENT, INSIGHTFULL

STAY INFORMED WITH TIMELY AND INTERESTING ARTICLES FROM OUR BLOG, MISSION CHRONICLE. OUR ASPIRATION IS TO PROVIDE REALTORS AND OTHER REAL ESTATE INDUSTRY PROFESSIONALS WITH EXCEPTIONAL RESOURCES AND SHARE OUR KNOWLEDGE TO PROPEL YOU TO YOUR GOALS.

  • Mission Chronicle Newsletter July 24, 2023

    Mortgage rates continued to press downward last week after the previous week's CPI data pointed to e...

  • Mission Chronicle Newsletter Feb 20, 2023

    Despite the recent downward trend in mortgage rates and hopes that the Fed was nearing the end of it...

  • Mission Chronicle Newsletter Feb 6, 2023

    The Federal Reserve meeting ended as market participants expected, with a quarter-point increase and...

  • Mission Chronicle Newsletter Dec 26, 2022

    Mortgage rates held relatively steady last week as most economic news came in better than expected.C...

  • Mission Chronicle Newsletter Dec 12, 2022

    Rates managed to move slightly downward last week as recession fears grew amid hopes that the Fedis ...

  • Mission Chronicle Newsletter Dec 5th 2022

    Mission Chronicle Newsletter Dec 5th 2022. Platforms: Browser, mobile-responsiveIdeal for: Leasing a...

  • Inman Review: Tenants and leasing teams get better connected with RentTango

    Have suggestions for products that you’d like to see reviewed by our real estate technology ex...

  • Tech Review: Smart Alto puts people first in its innovative lead qualification solution

    Have suggestions for products that you’d like to see reviewed by our real estate technology ex...

  • Refreshed and nurture-savvy, Market Leader’s CRM deserves your attention

    Have suggestions for products that you’d like to see reviewed by our real estate technology ex...

  • The top 4 tips to improve your negotiation skills

    In today’s luxury real estate market, strong negotiation skills are an asset—you might even say ...

March 2024
Mon Tue Wed Thu Fri Sat Sun
 123
45678910
11121314151617
18192021222324
25262728293031

  • Polls

    What information you are looking for?

    View Results

    Loading ... Loading ...
  • Last month Results

    How Is My Site?

    • Good (100%, 3 Votes)
    • Excellent (0%, 0 Votes)
    • Bad (0%, 0 Votes)
    • Can Be Improved (0%, 0 Votes)
    • No Comments (0%, 0 Votes)

    Total Voters: 3

    Vote

    Loading ... Loading ...