I just read another interesting article about home buyers and wanted to share this one also. This saddens me a bit as it’s becoming harder and harder for our younger generations to get off the ground. With high student loan debt, less than desirable job opportunity, and tighter underwriting guidelines, the dream of owning a home is seemingly distant to some.
I hope together our country can figure out a path that will not leave our future generations drowning in student loan debt, credit card debt, and a tax deficit that may never reach a reasonable level.
Our local housing market here in Roanoke, Virginia has an 11.29 month’s supply of inventory up from 8.09 in 2013. Yet the forecasts continue to say the housing market is picking up. I’m holding out faith and hope on that one and realizing more now than ever that if you want to sell your home it truly boils down to three major factors, price, condition, and location. Since we are able to control the first two we certainly should if trying to sell in today’s market.
If you have questions about buying or selling a home in the Roanoke,Virginia and surrounding areas our team would love to help. Please call me at 540-725-7727 or email me at christycrouch@aol.com or visit our website at http://www.thecrouchteam.com to discover more about our team and to see the homes we currently have for sale. Here is the article I mentioned above:
By Amy Cuculo
I have worked at Embrace for six years. I stay on top of market trends and relevant data. I understand the home-buying process well. With the spring buying season upon us, I have seen many recent news articles about the difficulties faced by first-time homebuyers. It got me thinking: I am exactly the type of customer people in the industry need to tap in to and empower to purchase – late twenties, fiscally responsible, steady job, good credit. I even have a leg up on my peers because I have an understanding of the mortgage process. But what’s holding me back? Like so many others, the answer is student loans.
The growing student loan burden carried by millions of Americans undermines the housing recovery’s momentum. It discourages potential buyers, like me, from purchasing their first homes. While the aspiration to own a home has remained unchanged – it is the American dream after all – consumers want to be responsible. First-time buyers are the foundation of the housing market but they are not stepping up to fill the void. In a recent survey by the National Association of Realtors, of the 20% of buyers who said it was difficult to save for a down payment, 54% said student loans made it tough to save money.
First-timers have accounted for nearly a third of home purchases over the past year, which is well below historical norms. Student loan debt trumps other debt and it is going to have a profound effect on a younger generation’s ability to borrower. The lending climate has become less forgiving with the introduction of QM. New federal rules have given lenders some legal protection as long as they do not approve loans for buyers whose total monthly debt exceeds 43% of their gross monthly income. Creating yet another hurdle, FHA, a popular choice for first-time buyers, currently allows lenders to ignore student debt that is deferred for a year or more when assessing a borrower’s eligibility. There has been indication that the agency may alter this rule,
Last year, the Federal Reserve Bank of New York conducted an analysis of the impact of student loans and the results were dramatic. From 2009-2012, the homeownership rates fell twice as much for 30-year-olds who had a history of student loans than those without the added debt. So the question is not do we want to own a home, but how will we own a home? How do we as a society build a finance system that supports homeownership?
Christy Crouch, Realtor, 