First-Time Buyers Struggle, Stalling the Entire Housing Market
With the real estate market remaining sluggish, many homes have been sitting on the market for extended periods of time. In a healthy market, inventory levels are driven primarily by new listings. However, in today’s environment, inventory includes both new homes coming on the market and a significant number of existing listings that simply aren’t selling.
A national housing economist recently highlighted the core issue with affordability, stating:
“Home affordability doesn't offer a much different story than many other commodities. It would take a 38% drop in home prices or a 60% increase in household income for affordability to return to 2019 levels. Buyers now need to earn $113,000 per year to afford the median home in the U.S.”
The health of the first-time homebuyer segment is the catalyst for the entire housing market. When first-time buyers struggle, the rest of the market slows as well.
Below is an article published last week by Realtor.com that further explains these trends.
Homebuyers are seeing more choices when it comes to shopping around for a new house. The number of active homes on the market increased 14% year over year, according to the Realtor.com® Weekly Housing Trends report.
