First Time Home Buyers Declining

Anaheim, CA, Nov. 16, 2011 -- Recent home buyers are staying well within their means with notably higher incomes and modestly higher downpayments than buyers in the previous year due to the restrictive mortgage credit environment, according to a study at the 2011 Realtors Conference & Expo.

NAR 2011 president Ron Phipps notes that financing obstacles were more challenging for entry-level home buyers.

“First-time home buyers fell to a 37% market share in the past year from a record high 50% in the 2010 study,” he said.

“Although last year’s findings were boosted by the home buyer tax credit, long-term survey averages show that four out of 10 buyers are typically first-time buyers. This segment is critical to a housing recovery because they help existing home owners sell and make a trade.”

Seventy-eight percent of recent home buyers said their home is a good investment, and 45% believe it’s better than stocks.

The study shows the median age of first-time buyers was 31 and the median income was $62,400, up from $59,900 in the 2010 study.

The typical first-time buyer purchased a 1,570 square foot home costing $155,000; the estimated median monthly mortgage principal and interest payment was $794.

The typical repeat buyer was 53 years old and earned $96,600, notably higher than the $87,000 median reported in the 2010 profile.

Repeat buyers purchased a median 2,100 square foot home costing $219,500, with an estimated median payment of $1,006.