Prospective first-time homeowners (FTHOs) must get creative and be prepared!
by Jackie Scheller
As Matt Vernon, head of consumer lending at Bank of America, puts it, there will be “both opportunities and challenges in the upcoming spring season.”
Buyers have been under pressure over the past two years as mortgage rates rose and inventory dwindled. Given the level of uncertainty in the market, the process of getting a new home or selling your current property this spring and summer will not be any less stressful.
If you are financially prepared and do your homework, you should be able to take advantage of an opportunity to buy or sell when it presents itself. It is never too early to meet with a lender or Realtor to discuss your situation.
Data from Redfin and Realtor.com point to double-digit gains in supply. Combined with an interest rate reduction, these supply gains will be good for both buyers and sellers.
Millennials (adults born between 1981 and 1996) currently represent the largest group of first-time home buyers. Image credit: National Association of Realtors
FTHO buyers are becoming creative; for example, some are asking family and friends for financial assistance. Millennials in the FTHO category are the most likely generation to say they purchased a multigenerational home—a home that includes two or more adult generations. This pooling of incomes and other resources has enabled them to afford a larger home. NOTE: Millennials are represented in the “25 to 33” and “34 to 43” age groups in the chart that accompanies this article.
Recent news on the legal front: The impact of a recent legal settlement that changes how Realtors get paid and by whom—the buyer or the seller—cannot be ignored. While there’s uncertainty over the effects and exact timing of the changes, they could happen as soon as July 2024. Sellers may choose to continue offering a split fee and pay full commission, offer a reduced commission, or opt not to pay buyer agent commissions at all. The latter means the home buyer may have to pay their agent out-of-pocket, negotiate on the home price to account for the change, or take some other action.
Home ownership is a privilege and most likely your largest investment. Reach out to a local Realtor for a no obligation (free) consultation to have your questions answered and to help determine your strategy. We are here to help!
Success does not come from luck, it comes from preparation. Get prepared and be creative!
Jackie Scheller is a licensed Realtor/real estate broker in Stockbridge, local business owner, entrepreneur, and retired business teacher. She holds a master’s degree in education from Wayne State and a bachelor of arts from Eastern Michigan University.
