First-Time Homebuyer Interest is on the Rise

The mortgage world is full of trends, and these are important factors to consider for many in the housing market when considering purchasing a home. Trends can impact everything from mortgage rates to the current supply, demand and values of homes in your area.

At Primary Residential Mortgage, Deb Gontko Klein, with the Reliability in Lending Team is here to provide you with the highest-quality expertise in the mortgage industry, its trends and how the selection of your mortgage loans and mortgage rates impact your ability to purchase a home. One big trend we’re keeping an eye on in 2020 is the share of new prospective homebuyers who count themselves as first-time buyers, a group we proudly serve regularly in our offices. Let’s look at the data behind this trend and the kinds of first-time buyers who have been most active in recent months, plus what this means for you.

Basic Data

The most recent National Association of Home Builders (NAHB) Housing Trends Report, which was performed for the final quarter of the year 2019, reported that adults considering purchasing a home in the next year decreased to 11% it was about 13% the previous year. This follows a five-year trend where this number has dropped every year, likely due to low housing inventory levels.

However, one detail of this data is important to note: The share of prospective first-time homebuyers has gone up to 63%, much higher than the 53% it was the previous year. This is the single highest share of first-timer home buyers on the prospective market (tied with the second quarter of 2018) since the fourth quarter of 2017, featured 72% first-time home buyers.

Breakdown by Generation

The largest group fueling this growth for first-time homebuyers is millennials, who are reaching their homebuying age in large numbers and are often looking for their first home. The study reported that just under 20% of millennials plan to purchase a home within a year.

Generation Z is at 13%, followed closely by generation X at 12%. Finally, baby boomers make up only 5% of the prospective first-time buyers list, not surprising as many of these home buyers are already homeowners and looking to upsize or downsize and move to prepare for their golden years of retirement.

To learn more about the best mortgage programs available for first-time home buyers please feel free to reach out to Deb Gontko Klein and The Reliability in Lending Team to provide you with the best mortgage fit for your long-term financial health and goals.

*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Opinions expressed are solely my own and do not express the views of my employer.