Although the inventory may be low and home prices are on the rise, the first time homebuyer share of home purchases increased again, according to Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, which is done by surveying about 2,000 real estate agents nationwide each month.
First time homebuyers increased this month to 38.9%, up from 38.1% last month and 37.2% last year
“Demand from first-time homebuyers is surging in springtime,” said Campbell Surveys Research Director Tom Popik.
The number of first time buyers increased for five consecutive months from December to April. They now trail current homeowners share of home purchases by just 6.8%. Investors make up the other 15.4%.
Although traffic may be high for first-time homebuyers over the past year, they still face a number of complications.
Some of these obstacles include not being able to pay cash for a home, which some sellers prefer, or paying smaller down payments which could lead to delays in closing as opposed to larger down payments current homebuyers can usually offer.
Cover letters are one example of how to put buyer offers above the competition, and looking at how tight inventory is in today’s market, buyers could use any extra help they can get.
Here is a sample cover letter buyers could use.
Whereas move-in ready properties usually targeted by first-time homebuyers received an average of 2.4 offers and non-distressed properties received an average of 2.2 offers, many real estate agents reported that desirable properties could receive up to 10 or more offers.
Real estate agents reported that other ways to beat the competition included making offers quickly after a home is listed or getting mortgage pre-approvals.