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Where Did All the First-time Buyers Go?

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Where Did All the First-time Buyers Go?
In January, first-time home buyers made up 29 percent of the market, the lowest since the National Association of REALTORS® started tracking first-time buyers on a monthly basis in 2008. In a healthy market, first-time buyers generally make up 40 percent to 45 percent of all purchasers. So with low interest rates and falling housing prices, why are first-time home buyers sitting on the sidelines? A USA Today article highlighted that one of the factors that have first-time home buyers skittish about the market is Tougher lending standards. 

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Some first-timer buyers can’t meet credit or employment history requirements. Lenders also are requiring higher credit scores and some want higher down payments that are shutting out more first-timers. The best loan terms usually require 20 percent down payment or more (who has this when they first get married, out of college, or having first kid).  Come on lenders!  I’m not saying do what you did in the early to mid 2000’s, and give ridiculous amounts of money to anyone breathing, but owning a home is the American dream, and if they have steady employment and income, and the house price is reasonable (under $200,000), lets get these first time home buyers into a home instead of just renting.  The lending requirements are too tight, even for reasonable situations.

See my social business card, including my real estate blog, at www.scottdeaton.com.

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By: on March 29th, 2011 Category: Uncategorized