Posts Tagged ‘down payment’

Millennials Over-Extended and Frustrated with Home-Buying Process

Posted on October 04, 2017 by Laura Lam

Millennials poured some $514 billion into the U.S. housing market over the last year as the largest generation of home buyers, Zillow reported.  But new survey data shows their home-ownership aspirations are stymied by affordability issues, frustration with the buying and selling process, and a cutthroat housing market. More than half of young buyers (53%) make multiple offers to buy their first home, and only 2 in 5 millennials (39%) are able to make the recommended 20% or more down payment.  The results of the Zillow Group Report on Consumer Housing Trends 2017 show how the nation’s highly competitive housing…

Millennial Homebuyers Worry About Affordability

Posted on September 01, 2017 by Laura Lam

According to a recent survey conducted by loanDepot, 52% of Millennials (born between 1981 and 1997), cite no longer wanting to pay rent and being ready to start a family as two top drivers motivating them to start looking into homeownership.  However, half of those surveyed are anxious about the expense of real estate and mortgage payments, with only 18% saying they think a home purchase is affordable for them. As for barriers to entering the housing market, Millennial renters are concerned about having enough money for a down payment (63%), knowing where to start the process (48%) – with 56%…

First-Time Homebuyers Deterred by Misconceptions

Posted on May 25, 2017 by Laura Lam

The lack of knowledge around the home purchase process was cited by 39% of mortgage executives as the leading barrier keeping potential first-time buyers from entering the market.  That topped a lack of inventory (29%), excess student loan debt (27%) and rising interest rates (6%), according to a survey taken during the Mortgage Bankers Association’s National Secondary Market Conference by Genworth Mortgage Insurance. The greatest cause of confusion among first-time homebuyers is the role of a 20% down payment.  Of those surveyed, 28% said consumers still mistakenly believe that a 20% down payment is a requirement for purchasing a home,…

Down Payments Eat Up Large Chunk of Income

Posted on January 31, 2017 by Laura Lam

To meet a 20% down payment, homebuyers on average have to spend more than two-thirds of the average annual income, according to a report from Zillow.  A 20% down payment for a median-price home valued at $192,500 will cost $38,500. In some of the larger and more expensive markets, including the San Francisco and Los Angeles metropolitan areas, buyers may need to pay more than 180% of the average annual income to afford a 20% down payment on a median-priced home. “Saving enough cash for a down payment is a major barrier to homeownership, especially in expensive markets, where a…

Homeownership Obstacles Vary by Ethnicity

Posted on July 20, 2016 by Laura Lam

While all prospective homebuyers may face challenges to buying a home, the perception of what those obstacles are can take different forms based one’s race or ethnicity, according to the results of a survey by the Futures Company in partnership with the California Association of Realtors Center (CAR) for California Real Estate. The obstacle cited most among all respondents was saving enough for a down payment at 29%. Next was housing supply constraints at 27%, followed by access to credit and financing at 22% and personal debt at 19%. Among African-Americans and Asians a similar trend played out. The highest…

A Mortgage for Debt-Ridden Millennials?

Posted on June 23, 2016 by Laura Lam

The extent to which student debt is keeping Millennials from buying homes is debatable. But for high-earning young professionals who are saddled with such loans, a Florida investment advisor says he has devised a path to homeownership.  This summer, John Burkey will launch the BurkeyLoan, which combines borrowers’ student loans and their mortgages.  According to Burkey, “they will be refinancing their school loans into their mortgages.” Initially, BurkeyLoans will be aimed at college graduates with “top-tier work and academic profiles” who seek jumbo mortgages in the $425,000 to $600,000 range. But by year’s end, Burkey said, the new mortgage product…

Millennial Home Buyers Choose Suburbs

Posted on March 14, 2016 by Laura Lam

Cities may be the top choice for millennials who rent apartments, but young home buyers are moving in droves to the suburbs, where prices are lower and backyards are plentiful.  The share of people 35 or younger who are buying homes in urban areas fell to 17% from 21% in a 2014 survey, according to a recent National Association of Realtors study. While many millennials say they prefer urban living, the rising prices found in downtowns is proving a barrier to buying, said Lawrence Yun, the association’s chief economist. Wealthy empty-nesters and foreign investors are fueling competition for a shrinking supply…

Student Debt Impacts Home Ownership

Posted on December 10, 2015 by Saldutti

A new report based on research from the Harvard Joint Center for Housing Studies indicates student loans has a potentially strong impact on consumers seeking to move from renting to buying a home. It also could delay their ability to build savings for a mortgage down payment. Young borrowers who are facing debt but didn’t finish their degree are looking at growing default and delinquency rates and challenges finding well-paying jobs, according to Irene Lew, a research assistant at the Harvard Joint Center for Housing Studies.  In Lew’s report, “Student Loan Debt and the Housing Decisions of Young Households,” she reviews the…

While Down-Payments Rise, Many Renters Not Interested in Home Purchase

Posted on December 07, 2015 by Saldutti

As demand outpaced supply in the third quarter, the amount of money consumers put down to buy a home ticked up, according to LendingTree.  The average down payment on a conventional 30-year fixed-rate mortgage rose 29 basis points from the previous quarter, to 17.63%. The average down payment by dollar amount rose 10.7%, to $48,924. The trend was driven by a rise in demand in certain markets, and the prospects of an interest rate increase by the Federal Reserve in the coming months, according to LendingTree founder and chief executive Doug Lebda. “Homebuyers will often bolster their buying credentials by offering…