|Don’t Get Caught in the ‘Renter’s Trap’
Posted: 27 Aug 2014 04:00 AM PDT
In a recent press release, Zillow stated that the affordability of the nation’s rental inventory is currently much worse than affordability of the country’s home sale inventory. The release revealed two things:
Don’t Become TrappedIf you are currently renting you could get caught up in a cycle where increasing rents continue to make it impossible for you to save for a necessary down payment. Zillow Chief Economist Dr. Stan Humphries explains:
"The affordability of for-sale homes remains strong, which is encouraging for those buyers that can save for a down payment and capitalize on low mortgage interest rates… As rents keep rising, along with interest rates and home values, saving for a down payment and attaining homeownership becomes that much more difficult for millions of current renters.”
Know Your OptionsPerhaps you already have saved enough to buy your first home. HousingWire recently reported that analysts at Nomura believe:
“It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.
It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)
Freddie Mac came out with comments on this exact issue:
Bottom LineDon’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible to get a mortgage.
Agents: Do you have the visuals you need to educate your clients on how much of a down payment is REALLY necessary now? The latest edition of KCM provides multiple slides with the explanations you need to be able to help your clients make the right decision for themselves.
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