Buying a home for the first time can be daunting, especially with how the market has been over the past few years. Rising interest rates and softening prices can create even more doubt for first-time homebuyers. <\/p>\n\n\n\n
This doesn\u2019t mean purchasing a home is a bad idea, but as an agent, you will want to be prepared on how to calm buyers, especially first-time buyers that may have more angst about the whole process than someone who has been through it before.\u00a0<\/p>\n\n\n\n
With first-time buyers making up about 34% of homebuyers in 2022, according to the 2022 Home Buyers and Sellers Generational Trends Report, <\/a>it\u2019s important to know how to work with first-time buyers and help them with their concerns. There have been added worries to address recently with the market experiencing a rise in mortgage rates, homes doubling in value, and lots of competition and now frequent price reductions, giving first-time homebuyers extra jitters about purchasing their dream home.\u00a0<\/p>\n\n\n\n High mortgage rates and a softening market are definitely the biggest concern on homebuyers’ minds right now. This coupled with increased home prices has first-time homebuyers second-guessing taking the plunge<\/a>. According to the National Association of Realtors<\/a>, the average U.S home price reached $350,000 in January 2022 and 65% of buyers are saying that this is too high.\u00a0<\/p>\n\n\n\n In addition to rising rates, first-time homebuyers have the normal fears of purchasing the right property, knowing what they can afford, knowing what lender to pick, and putting down a large chunk of change for the first time. Being able to address these concerns will make the difference in a home sale, but also a homebuyer continuing with you as a realtor over someone else.\u00a0<\/p>\n\n\n\n Real estate agents need to help first-time buyers see that those concerns are normal and part of the process. Just like when an agents is getting started<\/a>, there are lots of questions and concerns from the unknown. Let\u2019s take a look at these concerns and how you can help calm a first-time buyer that has them.<\/p>\n\n\n\n To start, let\u2019s address high mortgage rates. What first-time homebuyers do not realize is that if you have a lower credit score, the interest rate on your mortgage loan is going to be higher. Let’s use an example. If someone had a credit score of 700 to 719 with 20% of the mortgage price to pay upfront, the average rate on a 30-year fixed-rate mortgage on May 19 was 5.833%, according to Bankrate. On the other hand, if someone had a credit score of 660 to 679 with the same 20% upfront, the average mortgage interest rate was 6.66%. If that same person had a credit score of 800 or above, he or she would have most likely been able to secure a mortgage interest rate of around 5.5%. In essence, a person could pay more in points as opposed to interest rates.<\/p>\n\n\n\nFirst-time homebuyers biggest fears<\/strong><\/h2>\n\n\n\n
How <\/strong>can <\/strong>agents help calm first-<\/strong>time homebuyers’ <\/strong>concerns during this crazy market?<\/strong><\/h2>\n\n\n\n