Four decades ago in the U.S., the typical first time home buyer had been renting for just over two and a half years, and was younger than 30. Fast-forward to today, and times have changed. The economic headwinds, including “underemployment, student debts, lackluster wage growth, and rising rents,” are making it more difficult for 1st time purchasers to enter the realm of property owners.
However, there are some silver linings. Down payment assistance and a variety of other first time home buyer programs are amply available. In addition, today’s starter home is more spacious than those of previous decades.
National Mortgage Professional reports:
The average first-time homebuyer is about 33, at the front end of the Millennial generation. Their median income is $54,340, which is about the same as what first-time homebuyers made in the 1970s, when adjusted for inflation.
In the late 1980s, 52 percent of first-time homebuyers were married. Today, only 40 percent were married.
“Millennials are delaying all kinds of major life decisions, like getting married and having kids, so it makes sense that they would also delay buying a home,” said Zillow Chief Economist Dr. Svenja Gudell. “We know Millennials value homeownership and want to buy. The next challenge will be figuring out how they can save for a downpayment and qualify for a mortgage, especially while the rental market is so unaffordable all over the country. The last hurdle will be finding a home they like amidst very tight inventory, especially among starter homes.”
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