Home sales are slowing as the year stretches on, however, that’s not true for one market segment – first time homebuyers.

In the second quarter of 2018, total single-family homes purchased by first-time homebuyers increased just 1% from last year to 572,000 homes, according to the First-Time Homebuyer Report from Genworth Mortgage Insurance.

The report aggregates all publicly available government data and proprietary mortgage industry data into one dataset.

But while home sales to first-time buyers slowed in the second quarter, the first half of the year saw 985,000 single-family homes purchased, the most during the first six months of a year since 2005.

“The market needs to put this quarter’s slowdown in first-time homebuyer purchase growth in context,” Genworth Chief Economist Tian Liu said. “Because while quarterly first-time homebuyer purchase growth was nominal, on a semi-annual basis this group recorded the most single-family home purchases since 2005.”

“That is impressive considering overall home sales declined by 2% during the second quarter, with unusually slow activity in June,” Liu said. “The decrease in home sales was driven by an increase in both interest rates and home prices that together raised monthly mortgage payments for first-time homebuyers by 12.6% year over year.”

Here are some of the stats the second-quarter first-time homebuyer report revealed:

 

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Despite rising rates, a slowdown in new home construction and a drop in supply at every price point in the affordable rates or $150,000 to $300,000, homebuyers under 35 years of age increased their homeownership rate, the report showed.

“First-time homebuyers have a wide range of low down payment mortgage products today to help them become homeowners, accounting for 79% of all home purchase transactions,” Liu said.

“Over the past few years, conventional loans with mortgage insurance have become increasingly popular,” he said. “This quarter, for the first time ever, it became the largest source of credit to first-time homebuyers.”

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