Where have all the first time homebuyers gone?
Traditionally first time buyers have made up about 40% of the marketplace, so says Nin-Hai Tseng, a CNNMoney.com journalists, and I use that term lightly. She goes on further to state that they currently make up 34.7%, the lowest level in the last 3 years, in an article entitled
Where are the first-time homebuyers?
I was thinking about this and I'd like to ask, do you think they're
Spooked
I mean think about it for just a minute.
for an extended period of time over the last 3-5 years everything, or so it seemed, that was written about real estate and home ownership was extremely negative, and much of it was true, unfortunately. The market and the reporting of the real estate happenings was all
doom and gloom
that's not exactly an environment that might have you preparing to own your first home. So what's up now? What's holding back the first time homebuyers.
Well, one of the continuing problems is our national media, and their habitual misreporting of the facts.
I still hear the experts on the tube, and the writers stating that you need a 20% down payment, perfect credit, and that you're still not going to be able to acquire a mortgage in many cases.
Well to quote good olde Sherm Potter in "MASH"
Horsehockey
In Nin-Hai's article the writer goes on to state the following,
"A few reasons explain why first timers have been left out. For one, the deteriorating finances of the Federal Housing Authority...the agency has struggled with huge losses from souring home loans, leading many to believe that the agency will eventually need a government bailout."
Oh no, FHA's going down...I don't think so.
The writer states further that starting next year the premiums will be increased, causing a $13.00 per month average in increased payments.
First, of all you're not going to have to wait till next year to see an increase in premiums, a move made to straighten the FHA's financial position, and
Second, in any given year increases in taxes and/or insurance could easily increase your monthly payments to a greater extent.
So, what to do?
I'd really like to see the national media stop spooking our homebuyers. let's start printing the truth from both sides.
I've been writing mortgages for first time homebuyers for over 30 years and the FHA has always been a primary source, and I expect that that will continue to be the case.
I've also been teaching an Affordable Housing Course for first time buyers. In my case for those seeking down payment and closing cost assistance, and I feel it would be helpful for all involved, if first time buyers took such a course, whether it's required or not.
It's just a good idea to help them from getting
Spooked
instead of
excited
about
owning their first home
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