The Millennial FHA Home Buyer
According to Ellie Mae’s Millennial Tracker, more than a one third of all mortgages made to millennials since 2014 were Federal Housing Administration (FHA) loans. Cash-strapped millennials are utilizing this federally insured program to help them enter the housing market since it only requires 3.5 percent down.
Home ownership is a goal for many millennials. However, a recent CNBC article noted that credit—no credit or low credit—is one of the reasons why millennials cannot qualify for a mortgage. This poses a huge problem since there are roughly 87 million potential millennial homeowners.
Despite record low mortgage rates, the US Census Bureau reported that home ownership has been down. Critics often blame millennials for dragging down the home ownership rate. However, are millennials really to blame?
Locally, Oahu’s real estate market is still very competitive. According to April's 2016 housing statistics, the median single family home price increased 6.7 percent, to $720,000, from the same time last year. Sellers are often working with high down payment conventional loan buyers or all cash offers. Demand is high and inventory is shrinking, especially for single-family homes.
What can we do to increase millennial home ownership?
Disclaimer: This is a personal blog. Ryan Oda (#RS-75450) is a licensed real estate salesperson with Benn Pacific Group, Inc (#RB-19423). The opinions expressed here represent my own and not those of Benn Pacific Group, Inc., its agents, and or its affiliates. My thoughts and opinions can change over time. This blog is intended to provide a semi-permanent snapshot of a selection of various thoughts and opinions that may not be the same, or even similar, to those I may hold today.
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