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Opendoor surveyed an estimated 1,000 first-time homebuyers nationwide who purchased their first home between January 2023 and December 2023 for their 2024 First-time Homebuyer Survey. The results show that people are still looking to buy a home; they are just going about it differently.
Co-buying with non-romantic partners is more common.
Most respondents (77 percent) purchased a home with someone else. While the more traditional purchase with a romantic partner remains the most common, at 61 percent, about 11 percent are buying with friends.
Co-buying is an accessible option to assist with upfront and ongoing mortgage costs, especially in this high-interest-rate market. If you are considering co-buying a home, experts recommend that you make sure you’re all in alignment with financial expectations, discuss credit scores, and agree on an exit strategy if one of you wants to move on.
Cost is still a major concern.
Unsurprisingly, many respondents cited affordability as having a major impact on their homebuying decisions. Fifty-three percent delayed purchasing a home because of finances, while 42 percent stated they did not even feel financially prepared. Because interest rates can impact the maximum purchase price allowed, as well as the affordability of a monthly mortgage payment, 32 percent state they are waiting for the current interest rates to lower before purchasing a home.
One way to understand what is considered “affordable” for you is to take stock of your current financial situation. Developing a budget will help you understand your monthly income versus your debt, identify spending that doesn’t align with your values, encourage savings, prepare you for unexpected expenses, and accomplish your goals. Here's a sample budget to help you get started. In addition, you should learn about the overall cost of homeownership, which extends beyond your monthly mortgage payment.
Buyers want an easier experience.
Ninety percent of those surveyed believed the homebuying process to be stressful. And FOMO is real for recent homebuyers, especially those under 40: 70 percent felt pressure to buy to not miss out on an opportunity, compared to 55 percent of those over 40. This rush to purchase can often result in buyer’s remorse; 65 percent wondered if buying a home was worth the stress.
To help reduce stress, research the differences between renting and owning to evaluate whether homeownership is for you. Then, take a CHFA-sponsored homebuyer education class to learn about the homebuying process; being informed can reduce a lot of the stress first-time homebuyers feel.
Tour burnout is real.
First-time buyers viewed an average of 23 homes in 2023. While Gen Z comes in with the highest views at 32, Gen X viewed the least, at 20. Many parents feel time-restricted, but 28 percent still toured 20 or more homes. Pair this extensive review time with the pressure to buy cited in number 3 above, and many first-time homebuyers end up feeling overwhelmed with options.
Here’s where the right real estate agent can help. By taking the time to find an agent that is aligned with your goals and desired service, you will have a partner in your home search—one that is specifically suited to narrowing your search and finding the best homes to meet your wants and needs.
Buyers are making compromises.
Something many first-time homebuyers learn is that their “dream home” is out of reach due to home prices, interest rates, etc. This is reinforced by survey respondents, 32 percent of whom didn’t purchase in their desired area, 28 percent compromised on desired features, and 22 percent bought a smaller home. However, compromising doesn’t mean that happiness is out of reach. Determining early on what is a “must-have” versus a “nice-to-have” can help you prioritize the homes you search for and what home you end up making an offer on.
Source: realsimple.com
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