More first home buyers rely on buydowns of mortgage interest
Homelight is a real estate platform established in Arizona that is designed to connect agents with customers. The survey of the company 2024 Top Agent Insights collected perspectives from more than 750 brokers between October 30 and November 15.
More than half (59%) of the agents reported a peak in unforeseen applications according to the report. First home buyers are struggling to reach homeowner without extra help. Agents reported that 27% of first-timer buyers asked for buydowns of mortgage interest from sellers. Homelight notes that this is increasingly common for the sale of existing at home.
According to the National Association of Realtors (Nar), Only 24% of recent buyers were first timers. For comparison: first buyers consisted of 40% of the market before 2008. Homelight also emphasized an increase in cash purchases as a factor that keeps buyers off the market for the first time, because they have to compete with buyers with all cash buyers and real estate investors.
Recommended were also a problem for first home buyers, with 23% dependent on family gifts to cover these preceding costs. Homelight said that this is a sign that the homeowner is increasingly hanging on generation richness.
According to the report, recent changes in the business practice in the real estate market have also discouraged first buyers. Homelight noted that the lawsuit of the NAR committee and the resulting settlement made buyers and sellers uncertain about dealing with changes in buyers’ broker agreements.
“It has had unintended negative effects against the most vulnerable group of buyers: first buyers and buyers with a lower income. In the meantime, the luxury market flourishes and is not influenced, so that the gap between classes is further widened, “according to an agent surveyed in Texas.
Other agents reported that the NAR arrangement complicated things for buyers and sellers is complicated. A respondent said that “buyers always have a shortage of money, and that they have to pay the agent’s committee, can be difficult if a seller is not willing to pay his brokerage committee.”
Despite predictions that predict mortgage interest above 6% in 2025, agents hope for a shift in the market. Homelight reported that 45% of the national agents are of the opinion that interest rates will fall, bringing buyers back to the market.
This optimism is also reflected in the expectations that cooling inflation and policy changes can improve market conditions. Agents are of the opinion that buyers of the offside will appear on the outside to grab the purchasing options of home under better conditions.
