Monday, April 7, 2014

First-Time Home Buyers Face Challenge


The desire to purchase a home remains strong among potential first-time home buyers as do some of the challenges they face when the decision is finally made to move forward.  Here are some challenges that first-time home buyers have to deal with.

 
  • All Cash Offers - One of the most frustrating situations for the first-time homebuyer is the investor. Investors paying with all cash often snatch up homes that the first-time buyers are hoping to purchase.  Generally speaking, sellers will consider the "all cash" offer less risky and choose to take the investor's offer instead of a financed one.  Fortunately, there are still some sellers who actually prefer to sell to someone who will love their home as they do, but we find this situation less often.  

 
  • Low Inventory - Sellers are not moving up to a "bigger and better"  home at the same pace that they have in the past.  This component of the market has caused a shortage of inventory, especially in the lower priced homes.

 
  • Lending Conditions - The good news is that mortgage rates remain low at approximately 4.4 % for a 30-year fixed rate loan.  A mortgage loan today is not as hard to get as it was during the recession, however, there are continued strict lending rules which will continue to hamper first-time buyers entry into the market.  

 
Traditionally first-time home buyers have been the pillar of a strong housing market.  For the market to remain strong in this area, homes will need to be available and affordable.

 
My advice to the first-time home buyer who wants to buy now is this.  First, meet with a reputable lender in your area. Do not rely on internet qualification as obtaining a mortgage can be complicated.  Next, find a real estate agent who knows the market and has a proven track record.  A good agent will guide you through this challenging but not insurmountable journey.  And yes, it is worth it!

 
Nancy Puder is a real estate broker in Arroyo Grande, CA. with Nancy Puder & Associates. If you have any questions or concerns regarding your own property, contact Nancy at (805)710-2415 or email Nancy@NancyPuder.com.  You may also go to Facebook.com/Nancy Puder Realtor and "like" her page to access other real estate related articles.

 

 
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1 comment:

  1. Impressions AlignersApril 29, 2014 at 1:51 AM

    I certainly agree that the average first time homebuyer is currently facing more than their fair share of challenges finding a good starter home in the current housing market. Take the Orlando metro area for instance, where despite rising home prices, the housing market is still relatively affordable based on a national scale. But this is market that has traditionally seen a lot of action from investors.

    Reports have shown that for January, first time homebuyers only accounted for 29 percent of housing purchases in the Orlando Metro area. That recorded number of first time buyers in January was as low as it was in late 2008. It looks like plenty are still opting to rent over buy.

    I actually wanted to dig a little further on this, and I came across this informative article that provides a little more depth on the challenges facing first-time buyers in the Orlando housing market.

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