First Time Homebuyers Limited By Booming Housing Market
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DALLAS (CBSDFW.COM) - With homes prices in North Texas up roughly 10 percent more than a year ago and properties still moving quickly, the stiff competition can limit options for many first time homebuyers.
“A lot of the houses are sold as soon as they hit the market,” said Jordan Whyard. “You don’t even have an opportunity to bid on the house, and if you do, the majority of the houses are going above asking price.”
Whyard said his family has put the house hunt into high gear, while scaling down expectations.
“Right now, it’s really about settling for what you can get. Now, I’m actually purchasing the first house to get to my second.”
At 29, the tech savvy millennial knows it’s a good problem to have. Experts said for many millennials — roughly defined as adults 18-36 years old — staggering student debt has replaced the home mortgage. But for 26-year-old Richard Green, the big obstacle is the credit card he received as a teenager.
“I thought of it in terms of a way to get something when you couldn’t otherwise afford it,” said Green, “and it caught up with me.”
Even with cash on hand and good credit, some experts said many millennials would still rather rent—having been so deeply scarred by the recession.
“Maybe you were 20 and your parents lost their home, they lost their investment portfolio to the market,” said financial strategist Clark Hodges of Hodges Capital, “yeah, they are definitely ‘snake bit’ by this.”
And while hesitation is understandable, Clark believes that many millennials are missing out on opportunities to acquire wealth.
“If you find a home that you like and you think it’s a good value, I’m telling you — if you buy it today, you will be glad you did four or five years from now and you will be better off financially, because of it.”
And while the healthy real estate market has increased competition for homes at lower price points, experts said there are still entry level homes available. And there may be more assistance available to help get in those homes than many would be homebuyers realize.
For example, in Dallas, funds are available to first-time homebuyers at 80 percent (or less) of Area Median Family Income (AMFI) for principal reduction, down payment, and closing costs assistance up to $8,500. The program also provides a grant of up to $1,500.00 for Minimum Housing Standards repairs.
Under the program, a first-time home buyer is defined as someone who has not owned a home in three years. Under first-time home buyer programs, single parents and displaced homemakers automatically are considered first-time homebuyers. And there are other programs available as well.
Potential homebuyers may also call the City of Dallas Housing/Community Services Department at 214.670.0680.
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