Many first-time buyers either canât find what theyâre looking for or are so saddled with student debt they canât afford a home in what is currently a highly-competitive âsellerâs market,â experts told this news organization.
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To lock down a home thatâs for sale â especially a cheaper one â buyers often must come up with a 20 percent downpayment and make an offer thatâs above the sellerâs asking price, said Karen OâGrady, president of the Dayton Area Board of Realtors and a Realtor at Coldwell Banker.
That can be a difficult reality for a first-time home buyer to accept, she said.
âTry to get a first-time homebuyer to believe you when you say youâve got to make an offer now and youâve got to make it for at least $500 over list,â OâGrady said. âTheyâre losing a lot (of homes) because theyâre going through homebuyer shock. Theyâre entering into the market at the worst time they can enter it.â
The most recent monthly report from the Dayton Area Board of Realtors said home sale prices in September were up about 5 percent over last year, with an average price of $159,699.
âSellers marketâ
On top of having to pay more, first-time buyers are having to make quick decisions, OâGrady said, sometimes hours after seeing a home for the first time.
Alina Hutcheson, 45, of Dayton said she found herself in a similar situation in 2015. Everytime she found a house she liked, it ended up getting sold right away.
Hutcheson eventually landed the home she wanted but had to offer $2,000 over the asking price of $156,400, she said.
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âWe noticed very quickly it was a sellers market,â she said.
She said she sympathizes with recent college graduates who are not only facing high college loan debts, but also rising prices in the housing market.
High student debts
The average time to buy a home after college is now seven years, according to the National Association of Realtors, as more graduates put off buying a home until they can pay down on their student loans.
Around 41 percent of first-time home buyers have student debt of around $29,000 on average, NAR reported.
High student debts are a common issue first-time buyers face when trying to get a mortgage, said Patti Stoll, manager of PNC Bankâs wealth management team in Dayton.
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She has advice for those wishing to buy a home while still paying on their college loans: Take small steps.
âI think it is easy to go off course and purchase something you donât really need, especially in the very beginning,â Stoll said. âTake small steps, prioritize, plan and donât think that those small steps in the future wonât mean anything.â
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By the numbers
34: Percentage of people who bought homes this year who were first-time buyers.
36: Number of years since the percentage of first-time buyers was that small.
41: Percentage of first-time home buyers who had student loan debt.
$29,000: Average student debt for first-time buyers.
7: Average number of years college graduates delay in buying a home.
Source: National Association of Realtors.
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