Just in time for Valentine's Day, New York-based consumer finance company Bankrate says one in five Americans have their hearts set on owning a home – and they'd like to buy this year.
Millennials and Gen Xers are Most Interested Home Buyers in 2017
The report says 59 million U.S. consumers expressed a desire to purchase a home in 2017, with the most interest coming from older millennials (ages 27-36) and Gen Xers (37-52). Bankrate's senior mortgage analyst, Holden Lewis points to a "pent-up demand for home buying among Millennials who have been stymied by stagnant wages, student loans and a lack of available starter homes. If enough affordable homes are put on the market, we might see a surge of first-time homebuyers in their early to mid-30s.”
Limited inventory in the lowest price-range of homes (i.e., starter homes) over the last few market cycles has made buying a challenge, if not impossible, for many new homebuyers. Whether the optimistic survey respondents see their hope of homeownership come to fruition will be contingent on a much-needed increase in marketable homes.
Now is the Time to Act for Homeowners Considering a Move
Just as potential home buyers have been heeding warnings about the detrimental effects of rising interest rates on their buying power and ability to qualify, homeowners should also take note – especially those who may be considering a move. While noticeable, interest rate increases have not yet been dramatic and the Mortgage Bankers Association predicts that rates will finish the year around 4.4 percent. The ability to get a mortgage at or around 5 percent is still a "ground floor opportunity," which makes these lower rates marketable to first-timers. Loan officers and Realtors should be driving this point home through all their marketing targeted at new consumers.
As for current homeowners considering a trade-up or a second home, it’s also important to inform them that interest rates are likely to change, and now may be a good time to make a move.
With fifty nine million people hoping to buy this year, it's apparent that home ownership is still part of the American dream.
Nurturing leads through what can be a long process – from initial contact all the way to closing – requires organization, consistency, and a keen awareness for opportunity. Loan officers and Realtors should make it their mission to help people understand that now is the time to get out there and capitalize on this opportunity.