Speaking with Mortgage Professional America, MBA’s vice president and deputy chief economist Joel Kan (pictured top) said the first-time homebuyer cohort was accounting for “pretty strong” demand across the US mortgage market.
Demographics are playing a big role in driving that trend, he said, with a sizable portion of the US population now entering the age range usually associated with first-time homeownership.
“Not everyone can afford to own a home, but at the same time you get this increased likelihood of homeownership as the population ages,” he said. “So again, with such a big segment of the population in that range – whether it’s job-related changes or just the life stage, maybe starting a family – you do get to a point where you have this increase in homeownership.”
First-time homebuying on the up
An increase in the share of FHA mortgages being done specifically on the purchase side is also telling, Kan added, because more than 80% of those loan types tend to go to first-time homebuyers.
An uptick, then, is “pretty closely connected with more first-time homebuyer activity,” he said, especially as that buyer cohort is generally relying predominantly on savings and a downpayment to purchase.
