Young homebuyers to impact housing market

Younger homebuyers to have big impact on housing market
June 13, 2013

The housing market has come a long way since since the bubble burst in 2008, and younger Americans are recognizing that now might be the time to buy.  A recent survey from the PulteGroup showed that more than half of renters age 18 to 34 said their intentions to buy a home have increased in the last year.

While the reasons the survey respondents were interested in owning a home varied, some of which were for personal reasons, a large majority is expected to want to own a home, instead of rent, due to the rising rental costs and near record rates on residential mortgages.

“The propensity for young adults to test the waters of homeownership continues to increase and has become more evident as renters are seeing the overall value of owning a home,” said Deborah Wahl, senior vice president and chief marketing officer at PulteGroup, noting that more than 50 percent of Millennials reported that the desire to own/build equity was the primary reason for purchasing a new home. “However, beyond finances, it is important for potential buyers to take several other factors into consideration.”

Americans are confident in real estate A separate report showed that Americans were more confident in May in their ability to buy and sell a home. According to Fannie Mae’s May 2013 National Housing survey, 40 percent of the respondents said now is a good time to sell, accounting for a record share of people who felt that way. The report noted that last month, only 30 percent of respondents felt April was a good time to sell, while only 16 percent were confident in their ability to sell this time last year. Of the respondents, 76 percent said May was a good time to buy, up 5 percent on a month-over-month comparison.

“Sentiment toward selling a home appears to be catching up with the strengthening housing market,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “The share of consumers who think it’s a good time to sell a home spiked this month, the largest increase in the survey’s three-year history. This jump may foreshadow a gradual return to more normal levels of housing supply from their lows of recent months.”

New home owners are encouraged to find a reputable mortgage lender that will ensure the homebuying process is as easy as possible.

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