First- time buy­ers ac­count for al­most half of mort­gages

Connecticut Post (Sunday) - - Real Estate - By Prashant Gopal © 2018 Bloomberg L. P.

“This is a mil­len­nial- driven rise. You’ve got a strong econ­omy that’s help­ing, along with the ap­petite of the fi­nan­cial mar­ket to in­vest in mort­gages.” Fred­die Mac Chief Econ­o­mist Sam Khater

Young Amer­i­cans are hit­ting more and more home­own­er­ship road­blocks: crip­pling stu­dent debt, es­ca­lat­ing home prices, surg­ing mort­gage rates and a scarcity of list­ings.

So why have they gone on a buy­ing binge?

First- time buy­ers ac­counted for 46 per­cent of new mort­gages ( ex­clud­ing re­fi­nanc­ings) that Fred­die Mac backed in the first quar­ter, their big­gest quar­terly share in data go­ing back to 2012, ac­cord­ing to the com­pany. Mean­while, the Na­tional As­so­ci­a­tion of Realtors puts the me­dian age of first- timers in the U. S. at 32.

In other words, it ap­pears that young peo­ple, helped by eas­ier credit and an im­prov­ing job mar­ket, are act­ing fast as rents rise and a surge in prop­erty val­ues and bor­row­ing costs threat­ens to price them out of home­own­er­ship.

The sheer size of the gen­er­a­tion means a lot of mort­gages, Fred­die Mac Chief Econ­o­mist Sam Khater said.

“This is a mil­len­nial-driven rise,” Khater said in a phone in­ter­view. “You’ve got a strong econ­omy that’s help­ing, along with the ap­petite of the fi­nan­cial mar­ket to in­vest in mort­gages.”

So while it’s a tricky time to be a young home buyer, it might be a good one com­pared with next year.

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