Many potential homebuyers may be putting off their purchase due to a lack of accurate knowledge about the state of the market and their ability to enter it. A survey from FDIC-insured bank Laurel Road asked college-educated Americans about their homebuying plans. The poll found many misconceptions about the housing market and arranging financing, with down payments, interest rates, and affordability all weighing on potential buyers.
“Purchasing a home is a life-changing decision, yet despite the range of resources, people often aren’t aware of the personalized options available to fit their specific situation,” said Alyssa Schaefer, Chief Marketing Officer of Laurel Road. The survey found that almost half of respondents are unaware of alternative down payment options, believing that 20% is barrier to their homeownership dreams. There is also a misconception about how much interest rates will rise.
Americans estimate they will buy a home in the next six years, on average. First-time buyers plan to buy in two years on average (when their average age will be 36) and 62% of those who are concerned about affordability are currently looking or plan to buy in less than five years, compared to 33% of those who aren’t concerned. Among those who have bought or plan to buy a home, 85% have plans for their equity if they refinanced their loan: 48% would put it into savings; 41% would pay off debt, such as credit cards or student loans; 27% would remodel their home.
Source: Mortgage Professional America
