On Thursday, USA Today published a view of what many of this spring’s first-timers have encountered in their inaugural home-buying ventures. Our own Twin Cities trends don’t precisely match those tapped by their research—but the themes cited in the national press are familiar here, too.
Although the headline emphasized the difficulties those buying a home for the first time may encounter (“3 Challenges Facing First-Time Homebuyers This Spring”), elsewhere in the piece, some bright spots were acknowledged. For Twin Cities readers inclined toward a ‘glass-half-full’ point of view, they tend to balance out the familiar challenges.
- According to the Mortgage Bankers Association, affordability has advanced with the easing of 30-year fixed mortgages to a national average of 4.42%.
- Inventory “has loosened up slightly.” This is a relative finding since the U.S. still lags in properties for sale (at least compared with the historical norm).
- Prices. Price growth has slowed “and leveled off” according to the MBA.
- Spring buying. Nationally, good, old fashioned negotiations have replaced the frenzied bidding wars of last year. But USA Today isn’t calling this spring a buyer’s market—only one characterized by fewer competing offers.
- Home prices. Prices are still relatively high—especially for those buying a home for the first time. Since they can’t count on the equity built by their current property, scrambling for a substantial down payment can be a barrier.
- Securing a loan. In March, the FHA said that it is tightening its rules for high-risk mortgages. As is generally the case, this can provide a hurdle for first-timers.
- Inventory is still tight. Some finger-pointing is aimed at the home construction industry, which is only now rebounding from the recession-spawned falloff in new home starts. Entry-level housing ($200,000 and less) is the sector hit hardest.
Buying a home in Twin Cities may take more determination for first timers—but that doesn’t mean it isn’t well worth the effort. Whether you are a first-timer or a long-time homeowner, give RE/MAX Preferred a call for an in-depth discussion of the possibilities presented by this spring’s many offerings!