by Buz Wolfe
If you have followed my blogs over the past several years, you know that I have frequently pointed out the lack of activity from entry level or first time buyers. In essence, I have attributed this to three factors.
First, many of these younger buyers are loaded with student debt. Second, many are under employed or not working in the field for which they trained or studied. Finally, many of them just fail to see the value in home ownership – – having paid attention to the economic downturn and housing crisis the 2008-2012 period.
Well, according to the Pennsylvania Association of Realtors (PAR) and the Council of Residential Specialists (CRS), young buyers are growing increasingly tired of renting and are indeed beginning to see the value of home ownership. Buyers in the 18-34 age range, frequently known as “Millennials” or “Generation Y”, have discovered owning a home helps build wealth and are now becoming the largest chunk of home buyers in the marketplace. At approximately 35%, they edge out “Generation X” (26%), the “Baby Boomers” (31%) and the “Silent Generation” (9%).
Inasmuch as the residential real estate marketplace is very much a “trade up” phenomena, it is critical to have entry level buyers absorb first homes or starter homes so that those sellers might move on to larger and more expensive homes. This will then facilitate the ability of the sellers of the larger and more expensive homes to downsize – as is increasingly common among the over 55 market.
Millennials are known to be tech savvy and “do it yourselfers”. While most start their home searches on line, it should be noted that, nationally, 90% of Millennials used an experienced real estate professional to complete their purchase. They indicated that the complexity of financing and closing issues were stressful and that the real estate professional was invaluable in helping them navigate the process and close on their new home.
Finally, studies show a reversal trend among young buyers. They are increasingly moving away from city centers and urban areas and looking for homes in the suburbs and small towns. Certainly, this bodes well for the Greater Carlisle Area real estate market as well.
So, the good news is that first time buyers are buying again! And all studies indicate that they are relying on the expertise available from knowledgeable real estate practitioners. EXPERIENCE MATTERS!
*Ray L. “Buz” Wolfe, CRS has been Broker/Owner of his own firm since 1986. In 2015, he was again the Carlisle Area’s Top Producing Independent Broker.
**All information believed to be accurate but not guaranteed.