Tamara has some good points here in her blog. There are many people that want to buy homes! There are renters the believe it is a good time to buy and would choose to if it was an option.
Is this the first stage of recovery?? I hope I hope I hope!
Thanks Tamara for the good Blog.
Shannon Coe Realtor #01489731
WR Properties Brentwood CA
January 27, 2011
A National Association of Realtors poll conducted this month found that both current homeowners and renters feel that buying a home is a positive choice. 70% of homeowners and 48% of renters strongly agree or agree that homeownership will help them acheive the American Dream, while 77% of homeowners and 55% of renters believe that owning a home will help them achieve their long term financial goals. Even more telling is that 95% of homeowners and 72% of renters believe that over a period of several years it makes more sense to own a home.
If renters had to move in the next 6 months 50% of them would choose to buy a home rather than rent and 58% of renters think now is a good time to buy.
So if so many renters feel this way why aren't they buying? According to the poll the biggest obstacle renters feel they need to overcome is coming up with enough cash for the closing costs and the down payment (80%), this is followed closely by not being able to find and affordable home (71%) and not being able to afford the monthly payments (66%). Ability to qualify for a mortgage (63%), concerns about job security (61%), knowing how much house they can afford (59%) and concerns that the home will drop in value after they purchase (50%) round out the list of obstacles that renters feel are standing in the way of home ownership.
82% of renters and 92% of homeowners believe that a high rate of homeownership strengthens the community. This being the case what can be done to overcome the obstacles? In addition to our standard role as Realtors to educate the buying public and steer them to other experts that can help, here's what I think the government should be considering:
1. Providing some level of matching funds for downpayment savings accounts. This could be structured like a 401K, say matching 50% of the savers contribution up to 12% of their salary. Or maybe a savings bond type structure specifically for home purchases. Maybe some of the TARP repayments could be used to fund these accounts, or a percentage of building permit fees.
2. As for affordability we need to reeducate home purchasers on the availability of programs to help them buy and repair a "fixer", we also have to stress the model that was prevalent in my parents' generation of the "starter" house.
3. Mortgage qualification, what a mess. Remember when the banks would run the debt to income ratios and evaluate the prospective buyer's track record on repaying debt then make a decision about whether or not this borrower made sense for the bank's portfolio? That seems to make sense to me. I personally don't believe that mortgages should be commoditized or that banks should be able to sell their paper. Fannie, Freddie, and HUD could go back to guaranteeing mortgages that meet their guidelines and all will be right with the world.
4. Job security is another biggie, this one just has to work itself out. It's an economic cycle and we are unfortunately at the bottom of the wheel.
So those are my ideas? I'd love to hear yours. Keep me posted. By the way, here's a link to the study: http://www.realtor.org/statsanddata/homeownership/attitudes_homeown, I used the charts for this post: http://www.realtor.org/wps/wcm/connect/07ecfa004579c5138bd0cb342c47dc89/attitudes_homeownership_exhibits_2011.pdf?MOD=AJPERES&CACHEID=07ecfa004579c5138bd0cb342c47dc89
Have a great day.