The US economy has not yet fully recovered but the real estate market is moving at top speed. Last May, home sales were more than 5% ahead than last year which is considered as one of the best years so far for the industry. However, first time home buyers are noticeably absent particularly since they make up 40% of the people pursuing the American dream of owning a home. In 2015, first time home buyers accounted only for 30% of home sales.
Why do first time home buyers hesitate to become a homeowner? The most popular reason is actually lack of information. Many potential buyers believe that only the wealthy can afford to pay a 20% down payment on a new home. The 20% down payment is actually a myth because there are available mortgages that only require s little as 3% to become available.
Majority of first time home buyers are millennials within the 19 to 35 age group. This generation has witnessed the great recession and foreclosures that have become a devastating experience for many people. Last year, many millennials have delayed with home buying not because they do not have the money but they are afraid of the possible consequences. Most of the millennials today have experienced student debt and the challenges of being a part of the workforce with limited opportunities and stagnant wage growth.
Surveys reveal that millennials want to become homeowners but at least 73% do not know about available financing options designed specifically for their group. In previous years, the Federal Housing Authority supported mortgages with 3.5% down payment but since 2014, Fanny Mae and Freddie Mac has started to guarantee mortgages with 3% down payment available through responsible lenders. However, low down payment programs require good credit standing and verifiable income with additional requirements that include mortgage insurance.
In Australia, buying the first home can be an overwhelming and confusing experience. Without suitable assistance from expert consultants, costly mistakes can be experienced. Through firsthomeownerscentre.com.au, you will enjoy exceptional customer service. All the necessary information about the property including financing options will be made available so that you can make an informed decision.