Important Things You Must Know About First-Time Home Buyers

Important Things You Must Know About First Time Home Buyers

First-time home buyers are among the most in terms of numbers as far as the number of home buyers is concerned. Usually, their classifications composed of some millennials and the younger population workforce who have saved enough to purchase a house, or those who are qualified to get a mortgage loan. Since they account for at least the majority of home buyers throughout the country, what they do (or not doing) could have a huge impact on the real estate market in general. On that note, knowing the most important characteristics of first-time home buyers are essential.

The first thing we need to know is the demographics of first-time homebuyers, the, and younger generations, and their variation is best described in the written by Toni Lapp at Real Trends. Want to learn more about their changing demographics? Then read the article below to learn more.

The Changing Demographics of First-time Homebuyers

Image Source: Real Trends

Single women are one of the fastest-growing demographics in the housing market, according to research.

The future of real estate will be significantly influenced by women, millennials and Hispanics, according to®‘s analysis of first names on 2018 home sales deeds.

Single women are one of the fastest-growing demographics in the housing market, according to the data. Although older Baby Boomer and Silent Generation women are leading the charge, the increase in deeds with female names is particularly visible when comparing genders within the millennial generation. Looking solely at names with a peak year between 1981 and 1997, millennial female names are outpacing millennial male names, with home sales with female names beating male name home sales by 1.5 percent (6.9 percent versus 4.4 percent on average year-over-year, respectively). Seven of the top 10 fastest growing buyer names are predominately millennial female names, and all of them peak in the 1980s and 1990s.

Overall, Hannah, Austin, Alexis, Logan, and Taylor — of which three are predominantly female names — were the top five fastest growing first names on home sales deeds in 2018, with their frequency seeing an average increase of 22 percent from 2017. While Michael, John, David, James, and Robert were still the top five first names on sale deeds by sheer volume, these names saw a 3 to 5 percent decline over 2017.

Millennials are NOT the rent generation
In 2018, home sales with millennial names1 increased 5.3 percent, followed by Gen X names at 0.8 percent. Names of Boomers (born 1946 to 1964) and the Silent Generation (born before 1945) fell 2 percent and 3.5 percent, respectively.

Geographically, millennial buyer names are particularly overrepresented in Kansas, Indiana, Louisiana, Missouri, and Utah – states where housing affordability remains above national levels – confirming that jobs and availability of entry level homes act as magnets for young buyers. Click here to read the rest of this post…

One important information we must know that the current demographics of first-time home buyers are being dominated by single women, making them one of the fastest-growing in the housing market. In addition, the future of real estate will also be significantly influenced by them, as well as millennials and Hispanic. These millennials are also not the rent generation and they prefer owning a home than renting.

As mentioned earlier, not all first-time home buyers have the financial capabilities to purchase real estate in straight cash, but by borrowing money from lending institutions such as banks with mortgage interest rates they can afford to pay. Whether they have the capabilities to pay their loans or not could also have an impact as to where the housing market will head to. Katies of further explains the characteristics of today’s first-time home buyers are borrowers alike. Read the article below and know more about these characteristics.

First-Time Home Buyers: Characteristics of Today’s Home Borrowers

Photo Courtesy of Zillow

While the role of first-time home borrowers hasn’t changed much over time—they are generally vacating rental housing to move into starter homes—the characteristics of these new home borrowers has definitely evolved. Today’s first-time home buyers are older, less likely to be married, and purchasing more expensive homes than they have in the past.

What does this mean for mortgage lenders when these new buyers are ready to purchase a home? By understanding what drives their decisions, you can be more prepared to help this group of borrowers when they come looking for a mortgage loan, and you will be better able to connect with them and meet their unique needs.

Delaying their home purchase

The median age of 32.5 for today’s first-time home buyer might mean they’ve paid off any student loans or are close to it, making it possible for them to save even more for their home—or to afford a better home or neighborhood than they originally thought. They could be well-established on their career path with a reliable income and a higher credit score. This financial stability makes them less of a risk for larger loans and better equipped to handle a mortgage in general.

Renting longer

After renting for an average of six years, today’s first-time home buyer might not realize that there are more costs associated with buying a home than just what’s on the price tag. Helping your borrowers understand how their loan repayment will work, and being transparent about added costs, such as closing fees, can go a long way in helping them prepare for their first mortgage.

Being upfront and providing a complete financial picture will give borrowers confidence in you as their lender, which goes a long way in securing repeat and referral business. Click here to read the rest of this post…

First-time home buyers generally vacating rental housing to finally move into purchasing their very first home. Apart from the younger generations and millennials, some of the first-time home buyers are also older and less likely to get married in the next couple of years.

Jessica Guerin of Housing Wire also gives us more information on what you need to know about first-time homebuyers, as well as pinpointing relevant characteristics of this demographic.

Here’s What You Need To Know About First-Time Homebuyers

Image Source: Housing Wire

Earlier this week, we established that first-time homebuyers are not, in fact, being shut out of the housing market as some had feared, thanks to a recent study by the Federal Reserve Bank of New York.

Rather, their share of market participation has remained stable over time, rising and falling slightly over the last 17 years in response to market conditions, but averaging about 45% of the overall market.

The NY Fed revealed that as of 2016, first-timers comprised a healthy 46% of homebuyers.

Now, a second part of that study aims to pinpoint the characteristics of these first-time buyers and note how they have changed over time.

The goal, the researchers said, is to help shape housing policy aimed at enhancing access to homeownership.

First-time buyers generally take out smaller mortgages than repeat buyers.
And, this gap is widening. In 2000, the average origination mortgage balance was $117,000 for first-timers was and $143,000 for repeat buyers. In 2016, the average origination mortgage balance was $213,000 for first-timers was and $273,000 for repeat buyers. Read full article here…

Her article also debunked the common misconception that first-time homebuyers are being shut out of the housing market. Studies are being conducted to help shape a policy for housing aimed at enhancing access to homeownership. In addition, first-time home buyers are also typically conservative as they generally take out smaller mortgage loans than repeating buyers.

There are lots of first-time home buyers, and their actions have an impact on the housing market in the short, mid and long term. It is crucial to know their characteristics and their tendencies to prevent the real estate market from crashing. With all being said, if you’re a first-time homebuyer and looking for good home deals in Baltimore or in Nashville, Dependable Homebuyers can help you find affordable but quality home deals. To learn more, visit and let’s get started achieving your dream home.

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