In June of 1995, National Homeownership Week began as a strategy of President William Clinton’s administration to increase homeownership across the nation. In 2002, President George W. Bush expanded the observance to last the entire month of June.
While owning a home generally means going into debt, purchasing a home is one of the best investments in the United States. According to the National Association of Realtors, the national median price for existing single-family homes was $254,800 in Q1 (first quarter of the year) 2019, up 3.9 percent from Q1 2018. Rising home prices supports the idea that homeownership is still at the top of the list for ways Americans can improve their financial status due to home equity. It is generally felt that this movement to buy versus renting began in 2015; however, it didn’t really get officially noticed until this year.
Last year, those purchasing a home for the first time were facing two main problems, which were low inventory and home prices out pacing wage increases. This year the market is finally seeing a break in the discrepancy between home prices and wages. The current low-interest rates are drawing in first-time buyers.
The inventory problem from last year is also improving in most areas. Some places seem like the perfect place to purchase a home, but beware of a disguise. There is still a shortage of homes in places that are highly sought after.
While Millennials are eager to achieve the milestone of homeownership, they are also the ones who are dealing with student debt. Experts estimate that Millennials collectively hold $1.56 trillion in student loan debt. With all that debt, it’s easy to see what’s making members of this generation cautious.
There are plenty of mortgage products that can help home buyers get into a home and start building equity in a long-term investment. These options include, but are not limited to VA loans, FHA loans, and conventional loans with private mortgage insurance. The best policy is to do your homework before signing on the dotted line.