Buying a newly constructed house from a builder is a little different than buying an older home from its owner. To start with, you aren’t able to choose from a list of upgrades and customizations when buying an existing home. You’re also entering a transaction with someone who has an attachment to the home they’re selling and probably a different set of motivations than a builder whose livelihood depends on making a profit. In other words, it can feel, to a buyer, like the process of visiting a builder’s sales office is so wholly different than buying an existing home that they may not need an experienced real estate agent to represent them. This, however, can be a mistake. After all, you’re still entering into a major financial transaction with many variables and risks. You’ll want to have someone with experience who can look after your best interests and make sure you’re getting the best deal. Otherwise, you’ll be working with a team employed directly by the builder you’re buying from. That doesn’t mean you won’t get a good deal but it does mean you’ll be the only one whose top priority is getting what you want at a fair price. More here.
The number of owner occupied households has been lower-than-normal for several years. Following the housing crash, homeownership took a hit and, for many years afterward, trailed behind rental households in terms of growth. In short, more people were choosing to rent and the overall homeownership rate began a decade long retreat from its all-time high set in 2004. But, though the homeownership rate fell, Americans still consistently expressed a desire to own their own home. That there was a large majority of people who said they wanted to buy but were holding off meant, one day, that pent-up demand would result in a spike in home buyers. Now, according to new numbers from the Census Bureau’s Homeownership and Vacancy Survey, owner occupied households grew faster than rental households for the first time in 11 years during the first quarter of this year. This is significant because it may signal that more Americans are finally realizing their dream and becoming homeowners. Though encouraging, however, the uptick had little effect on the overall homeownership rate, which was unchanged from the previous quarter and has been relatively flat for a while. More here.
Over the past few years, a lower-than-usual number of young Americans have been buying homes. Historically, first-time home buyers made up around 40 percent of all home sales. In recent years, however, the number has been hovering just above 30 percent. Still, survey after survey shows that – despite not being as active in the market – young Americans still want to become homeowners. In fact, according to a recent survey from the National Association of Home Builders, 81 percent of respondents between the ages of 18 and 29 said they want to buy a home. That, combined with the fact that nearly 40 percent of total participants said they would like to buy a home in the next three years, is encouraging news for the residential real-estate market. Ed Brady, NAHB’s chairman, says homeownership is still an important part of the American Dream. “The survey shows that most Americans believe that owning a home remains an integral part of the American Dream and that policymakers need to take active steps to encourage and protect homeownership,” Brady said. Americans agree. The survey also found 72 percent in favor of the government providing tax incentives to encourage homeownership. More here.
Since the financial crisis and housing crash, the real estate market has made a lot of progress. The job market has improved, millions of mortgage modifications helped struggling homeowners keep their homes, home prices have recovered, and interest rates remain near record lows. As part of National Homeownership Month, the Department of Housing and Urban Development hopes to – not only reflect on that progress – but also promote the benefits of owning a home. “A home is the place where we raise our children, establish roots in a community, and plan our future,” HUD secretary Julian Castro said. “The opportunity to be a homeowner should be open to those ready and able to buy a home. As the housing market continues its recovery we must ensure that responsible homeowners have access to credit to make their dreams of homeownership a reality.” Despite the fact that homeownership continually ranks among Americans’ top goals and is still thought of as a vital part of achieving the American Dream, the nation’s homeownership rate is 63.5 percent – just above a 48-year low and well below its 2004 peak of nearly 70 percent. Still, strong buyer demand this spring is further evidence that, given the opportunity, most Americans want to become homeowners. More here.
Housing and Urban Development Secretary Julian Castro says the idea that younger Americans aren’t interested in homeownership is a myth and that it is as much a goal for them as it was previous generations. “The American Dream of homeownership is as strong today as ever,” Castro told the National Association of Realtors Regulatory Issues Forum. “And perhaps the best news of all is that millennials are showing that their generation is just as committed to homeownership as their parents and grandparents.” Long seen as an essential part of achieving the American Dream, homeownership seemed to lose some of its appeal following the housing crash and financial crisis. Since then, a smaller than normal share of younger buyers have been active in the housing market – fueling the notion that they weren’t interested in owning a home. But, according to one recent poll cited by Castro, 40 percent of millennials plan to buy their first home sometime in the next year. That high level of interest, combined with recent improvements to the labor market and economy, should result in more of those potential buyers becoming actual buyers, according to Castro. In his view, student loan debt has been the main obstacle for young Americans hoping to purchase a home. More here.
More than any other age group, Americans between the ages of 18 and 34 feel homeownership is an important part of achieving the American Dream, according to the results of a recently conducted survey. The survey found overall confidence in the housing market is down slightly from last year but aspirations for homeownership are at their highest level in two years. That is largely driven by young Americans who, in addition to expressing a desire to become homeowners, were also more optimistic about home price growth and, among current renters, whether or not they’d someday be able to afford their own home. Millennials are often portrayed as having less interest in homeownership than their parents or grandparents mostly because they’ve been slower than previous generations to enter the housing market. The survey results are encouraging because they show the reverse to be true. It is also good news for the overall housing market, as the number of first-time buyers has lagged behind historical norms over the past few years. More millennial home buyers would boost growth and provide further stability for the housing market. Conducted by Pulsenomics, the survey adds to growing evidence that residential real estate continues to be resilient despite recent economic uncertainty and volatility in the financial markets. More here.
The vast majority of renters say eventually owning a home is one of their top priorities, according to the results of a recent survey from the National Association of Realtors. In fact, 61 percent of renters say they want to buy, up 11 points since 2013. Chris Polychron, NAR’s president, says the survey’s results show Americans are ready for homeownership. “Homeownership is part of the American Dream, and this survey proves that dream is alive and thriving in our communities,” Polychron said. The survey – which measures consumer attitudes toward housing issues – found Americans in a particularly optimistic mood. For example, more than eight in ten Americans said they felt buying a house was a good financial decision and, among current homeowners, most believe they could sell their house for at least what they paid for it. Survey respondents also overwhelmingly believe now is a good time to buy a house and nearly 90 percent expect real estate sales to continue to improve. In short, Americans are feeling good about the real estate market and a growing number are thinking about buying a house someday in the near future. More here.