This is the second of three posts regarding trends in real estate markets. The first was on commercial markets. Next time I will discuss trends in the farmland market. Observations in this post were gleaned from my participation in the 2014 convention of the National Association of Realtors.
Here are some of the trends Realtors were discussing.
- The average age of homebuyers in 2014 rose to 44, up from 39 years in 2010.
- First-time buyers made up just 33 percent of the market in 2014, down from the long-run average of 40 percent.
- There was a marked drop in single female buyers in 2014.
- Americans are living in their homes much longer than in the past. The current tenure of homebuyers is ten years, up dramatically from six years in more normal times.
- Homebuyers are still finding it difficult to find a property they like.
- Finding a property is even harder than getting a mortgage.
- Several factors are constraining home sales volume in 2014.
- Many Americans don’t have the 20 percent down payment.
- A segment of Americans have tarnished credit in the aftermath of the Great Recession.
- There are a limited number of homes to choose from in many markets.
- Mortgage lenders are still reluctant to make loans to potential buyers with lower FICO scores.
- Help is on the way in 2015 for American homebuyers. It appears that Fannie Mae and Freddie Mac will be more amenable to making mortgage loans with just a 3 to 5 percent down payment for borrowers who can demonstrate the ability to make the payments.
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