First-Time Homebuyers Corner the Market in Q1 | Future Outlook Explains the Boost
Most people would consider buying a first home as part of the American Dream, epitomizing the hard work and determination of an individual or couple. According to Bloomberg, many dreams came true in the first quarter of 2018, with first-time homebuyers accounting for 46% of new mortgages backed by Freddie Mac.
Although it’s been extensively reported that young Americans are facing many challenges when it comes to homebuying—from student debt to increasing home prices—they’re also persevering. This is the first time since 2012 that this demographic has had the biggest quarterly share.
Coupled with the National Association of Realtors recent report detailing the median age of first-time homebuyers in the U.S. is 32, many experts callout three factors for their determination: the rising cost of rent, increase in property value and high borrowing costs.
Freddie Mac Chief Economist Sam Khater said, “This is a millennial-driven rise. You’ve got a strong economy that’s helping, along with the appetite of the financial market to invest in mortgages.”
Many young Americans are making decisions with a now or never philosophy, concerned that the homebuying process will only get worse as prices and interest rates continue to rise. Although the present situation for many first-time homebuyers isn’t all that great, fear for the future outlook can be seen through their haste to make home purchase in the first quarter.