Renters are losing confidence in housing as less say it’s a good time to buy a home, according to the National Association of Realtors Housing Opportunities and Market Experience survey.

Part of this is due to a misconception among first-time homebuyers about how much of a down payment is needed to buy a home, according to NAR.

In NAR’s third quarter HOME consumer survey, respondents talked about their confidence in the U.S. economy and other questions about their housing expectations.

Less than 20% in each age group and income bracket indicated that they need 10% or less to buy a home. Those over 65 and under 35 were the most likely to think they need more than a 20% down payment at 43% and 37% respectively.

“It’s possible some of the hesitation about buying right now among young adults is from them not realizing there are mortgage financing options available that do not require a 20% down payment, which would be north of $100,000 in some expensive areas in the country,” said NAR Chief Economist Lawrence Yun.

“In fact, most first-time buyers put down much less,” Yun said. “In the 35-year history of NAR’s Profile of Home Buyers and Sellers, the longest-running survey series of national housing data, the average median down payment has been 5% for first-time buyers.”

Homeowners who believe now is a good time to buy, while still strong, decreased slightly to 78%, down from 80% last quarter. On the other hand, the share of renters who say it’s a good time to buy decreased to 60%, down from 62% last quarter.

“This summer’s historically low mortgage rates injected some additional demand into the market, but the dearth of homes for sale continues to keep a lid on sales but not prices,” Yun said.

“Given the stiff competition and limited homes available at the lower end of the market, it’s not surprising at all that those under the age of 34 and in the West are the least confident about it being a good time to buy,” he said.

“Very affordable mortgage rates and strong job gains among young adults should be translating to a higher rate of homeownership,” Yun said. “It’s not, and as a result, sales to first-time buyers remain stuck below a third of all sales.”

On the other hand, 63% believe now is a good time to sell, up from 61% last quarter. Those in the West are the most likely to say now is a good time to sell, and the least likely to say it is a good time to buy.

Almost everyone surveyed, 93%, said they think prices will stay the same or rise in their community in the next six months.

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