Price Increases Are Challenging Buyers
As home prices and interest rates rise, more buyers, especially first-time purchasers, are under pressure. Home prices rose sharply in the last quarter of 2016, fueled by low inventories in many parts of the country, particularly in the entry-level home price range. Federal policies that restrict access to credit, including suspension of a planned reduction in FHA mortgage insurance premiums and high guarantee fees by Fannie Mae and Freddie Mac, will add to affordability woes.
More Renters Change Their Status
The share of former renters who have taken the plunge into homeownership has slowly but steadily increased over the last two years. The ex-renters include first-time buyers and so-called boomerang buyers who have reentered the market. Rising rents have contributed to the increasing interest in home buying.
Source: NAR Research