Numbers Count: First-time buyers’ revival?
Numbers count. They matter to bankers and to prospective homebuyers, sellers, and real estate professionals. Here’s my take on the key numbers on the housing market this week.The numbers: Demand for FHA, VA mortgages rises
FHA and VA purchase mortgage applications have outpaced conventional mortgage demand since last spring, and the gap has widened considerably since January, according to a new report on overall economic conditions from Fannie Mae’s Economic & Strategic Research (ESR) Group. ESR says the demand for these government mortgage programs is “perhaps an early indicator that the long-dormant first-time homebuyer segment is building momentum.”What counts: Fannie Mae’s report aligns with a report last week from our Chief Economist Scott Anderson, who is bullish on housing. Here are his reasons for being upbeat about prospects for first-time homebuyers:
- Student loan debt has been declining;
- There’s a big comeback in household formation (children leaving their parents’ home, singles moving out of shared housing to start their own households, etc.);
- The labor market is showing tentative signs of improvement; and
- Interest rates continue to hover near historically low levels
Individual financial circumstances are all different, but the big-picture indicators suggest 2015 may be a good time for first-time homebuyers to be in the market.