3 Biggest Obstacles Facing First Time Homebuyers

First time homebuyers could make up over 50 percent of all buyers in 2017 with over 60 percent of borrowers under the age of 35. In other words, millennials are poised to be the largest demographic in the housing market this year if they can overcome a few obstacles.

The 3 biggest obstacles facing first time homebuyers in 2017 are affordability, availability and down payment.

Affordability was an issue for many first time homebuyers in 2016 and it will continue to be a problem in 2017 with housing prices continuing to rise. Home prices have continued to rise year-over-year since 2012 and are up 40 percent from 2011 according to the NAHB Housing Opportunity Index.

While the S&P Dow Jones reported home prices climbed at more than twice the rate of inflation in 2016, Zillow and CoreLogic predict home values will rise between 3.6 percent and 5 percent in 2017, with some areas seeing double-digit growth.

Availability of affordable housing is another ongoing issue for first time homebuyers. While new housing starts are up, builders struggle with labor shortages and lack of developed lots. The number of construction workers in housing this year is 40 percent lower than what it was 10 years ago, according to industry research firm Redfin.

With fewer houses available to meet the growing demand in many areas, first time homebuyers may not have as many choices as they did a few years ago, or even last year.

Down paymentfor a new home continues to be an issue for many new homebuyers, especially if the cost of new homes continues to go up. Five percent of the cost of a home a couple years ago may not be enough for a down payment in 2017.

With the interest rate rising as well, monthly payments for new homes in 2017 are likely to be higher than the same houses in 2016. Fortunately there are loan programs available for first time homebuyers with low-downpayment options as well as 100 percent financing.

McKee Homes is committed to helping first time homebuyers overcome all of these obstacles and more in their path to home ownership. We are developing many new neighborhoods geared toward first time homebuyers with smaller, affordable new homes. These homes have our beautifully designed floor plans with highly functional features and options as well as our 2-10 Warranty Program that protects your investment for up to 10 years.

Whether you want to live in the Fayetteville, Pinehurst, Southern Pines and Aberdeen, Raleigh and Wilmington areas of North Carolina, we have beautiful, affordable new homes available as well as preferred lenders that will work with you to make sure you get the right mortgage to make your dream of owning a new home come true.

The post 3 Biggest Obstacles Facing First Time Homebuyers appeared first on McKee Homes Blog.


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