According to a recent report from the National Association of Realtors, first-time buyers comprised 32 percent of the nationwide home sales in 2016. Low inventory, rising home prices, rising rent costs, and rising mortgage rates are the biggest challenges facing first-time homebuyers.
The report states that 2016 housing inventory declined by 11 percent compared to 2015 levels. About 25 percent of the homes for sale in 2016 were in the starter range, defined as the lower third of the market. According to an analysis of the numbers by Trulia, this is 12 percent less than it was in 2015.
Rising prices and mortgage rates are not helping the situation for first time buyers. Mortgage rates have climbed from an average of 3.4 percent for a 30-year fixed loan in September to 4.2 percent in December 2016.
First-time buyers depend heavily on financing and affordability. Higher interest rates and higher home prices, combined with stagnant wages, are not helping the situation. While mortgage rates are higher, they are still at historical lows.
What is happening nationally is also very true of our local market in terms of rising prices, low inventory, rising rent costs and mortgage rates. These factors coupled with low wage growth, are increasing the challenges faced by first-time buyers, many of whom are rushing to buy before rates and prices increase further.
LOW
158 SE Heyburn St., Bend, OR 97702
2 beds, 1 bath, 738 square feet, .13 acre lot
Built in 1945
$168,000
Listed by Duke Warner Realty
MID
21195 Ritz Pl., Bend, OR 97702
4 beds, 2.5 baths, 2,560 square feet, .13 acre lot
Built in 2006
$354,900
Listed by Bend Premier Real Estate LLC
HIGH
19333 Moon Mountain Ct., Bend, OR 97702
3 beds, 3.5 baths, 3,093 square feet, .53 acre lot
Built in 2000
$1,375,000
Listed by Berkshire Hathaway Home Service
