June is National Home Ownership Month

June is National Homeownership Month

 

Some Highlights

• Every June, we recognize National Homeownership Month as a way to celebrate the many ways buying and owning a home is a solid step forward for American families.
• National Homeownership Month is a great time to reflect on how we can each promote stronger community growth.
• Homeownership helps families build financial freedom, find greater happiness and satisfaction, and make a positive impact on our local communities.

 

 

 

Owning a home is more than an address. When you invest in homeownership: you build financial stability, gain the freedom to create a home that fits your lifestyle, and play a role in strengthening your community!

 

• Customize your Space –  Last year, 73% of homeowners planned to renovate their homes to fit their lifestyle.  As a homeowner, you would have the freedom to create your dream kitchen, customize your backyard to entertain family and friends, or design an office space you love!
• Builds wealth – Did you know that the median net worth of homeowners is 46 times higher than renters?   Investing in a home creates an opportunity to increase personal wealth and equity over time.
• Advocate for your Community –   As a homeowner, the community around you impacts your life. That’s why you can and should advocate for policies that help strengthen your community and support homeownership!
• Gain Financial Stability  –   With rent prices increasing 3% to 4% each year, investing in a home can stabilize your housing expenses. Mortgages can provide homeowners with steady and affordable monthly payments.
• Improve Your Neighborhood –    Homeowners strengthen the communities they’ve settled in by being loyal customers at local business, investing in home improvements to increase the value of the neighborhood, and advocating for policies that support their community.

Facts about Homeownership

• The U.S. homeownership rate is 63.7 percent.
• The average first-tme homebuyer is about 33, at the front end of the Millennial generation.
• Approximately 80 percent of the 41.4 million Americans age 65 and older own their home.
− They have the highest homeownership rate among all age groups.
• West Virginia, Michigan, New Hampshire, Delaware, Maine have the highest homeownership rates of 70% or higher
• Every state has a homeownership rate of at least 50%.
• The housing sector directly accounts for approximately 14 percent of total economic activity.

Benefits of Homeownership

• Homeownership is an American value and the cornerstone of our economy.
• Responsible homeownership is the key to building wealth and a strong middle class.
• Homeowners move far less frequently than renters, making it easier to build community networks and support systems.
• Homeownership offers tremendous freedom to create the living environment that you have always wanted.

• According to the National Association of Realtors, homeownership confers many benefits including:
– Greater awareness of the political process
− Higher incidence of membership in voluntary organizations and church attendance,
− Lower teen pregnancy by children living in owned homes,
− Higher student test scores by children living in owned homes,
− Higher rate of high school graduation thereby higher earning,
− Children more likely to participate in organized activities and have less television screen time,
− Better health outcomes, including better physical and psychological health.
– Homeownership builds wealth over time and in the long run, buying is more cost effective than renting.
– Owning a home has positive tax implications for many families, and can often reduce tax burden.
− Your mortgage interest and property tax payments may be deductible from your federal taxes, as well as many state taxes.
– According to the most recent Federal Reserve Survey of Consumer Finances (2013), in the past 15 years, the net worth of the typical homeowner has ranged between 31 and 46 times that of the net worth of the typical renter.
− Data shows that median homeowners had nearly $200,000 in net worth or 36 times that of the median renter who had just over $5,000.

 

Benefits of HUD-Approved Housing Counseling  

• HUD’s Office of Housing Counseling supports a nationwide network of nearly 2,000 Housing Counseling Agencies, which are tasked with providing individuals and families with the knowledge they need to obtain,  sustain, and improve their housing.

*  These agencies are trained and approved to provide tools to current and prospective homeowners and renters so they can make responsible choices to address their housing needs.

• HUD-approved housing counselors are impartial, trained professionals who can help you make the decisions that are right for you. They provide homeowner education, pre-purchase and foreclosure prevention counseling, assistance with creating a budget and setting financial goals, fair housing information, and a host of other services.
• The Federal Housing Administration (FHA) supports HUD as a means to help make responsible homeownership available and sustainable for American families.
•      − Research shows a strong correlation between pre-purchase, post-purchase and foreclosure prevention housing counseling and mortgage performance.
•      − Independent research shows that delinquency, default and foreclosure rates for borrowers who have received counseling from a HUD-approved housing counseling agency are 30% lower than uncounseled borrowers.
•     − Housing counseling allows more consumers to receive individualized and objective advice on understanding the rights and responsibilities of homeownership, to address credit and savings barriers, and to meet their overall housing and financial goals.

Here is a list on HUD’s website of Approved Housing Counselors for Florida.  There are offices in Melbourne, Stuart, West Palm Beach, Deerfield Beach, Fort Lauderdale, Hollywood, and Miami, plus many more throughout Florida.

Becoming a homeowner means you are investing in your future, gaining freedom to create a space that fits your lifestyle, and helping to grow the community around you!

 

Three  Reasons Homebuyers Are Ready to Purchase This Year

A recent survey by Lending Tree tapped into behaviors of over 1,000 prospective buyers. The results indicated 53% of all homebuyers are more likely to buy a home in the next year, even amid the current health crisis. The survey further revealed why, naming several reasons buyers are more likely to move this year (see graph below):

Let’s break down why these are a few of the key factors motivating buyers to actively engage in the home search process, and the corresponding wins for sellers as well.

1. Low Mortgage Rates

The biggest reason potential home buyers indicated they’re eager to purchase this year is due to current mortgage rates, which are hovering near all-time lows. Today’s low rates are making it more affordable than ever to buy a home, which is a huge incentive for purchasers. In fact, 67% of respondents in the Lending Tree survey want to take advantage of low mortgage rates. This is no surprise when comparing historic mortgage rates by decade (see below):

 

Sam Khater, Chief Economist at Freddie Mac recently said:

“As the economy is slowly rebounding, all signs continue to point to a solid recovery in home sales activity heading into the summer as prospective buyers jump back into the market. Low mortgage rates are a key factor in this recovery.”

2. Reduced Spending

Some people have also been able to save a little extra money over the past few months while sheltering in place. One of the upsides of staying home recently is that many have been able to work remotely and minimize extra spending on things like commuting expenses, social events, and more. For those who fall into this category, they may have a bit more saved up for down payments and closing costs, making purchasing a home more feasible today.

3. Re-Evaluating Their Space

Spending time at home has also given buyers a chance to really evaluate their living space, whether renting or as a current homeowner. With time available to craft a wish list of what they really need in their next home, from more square footage to a more spacious neighborhood, they’re ready to make it happen. There looks like there may be a surprising shift to the suburbs emerging as a result of the pandemic and more urban areas.

 

What does this mean for buyers and sellers?

With these three factors in play, the demand for housing will keep growing this year, especially over the summer as more communities continue their phased approach to reopening. Buyers can take advantage of additional savings and low mortgage rates. And if you’re thinking of selling, know that your home may be in high demand as buyer interest grows and the number of homes for sale continues to dwindle. This may be your moment to list your house and make a move into a new space as well.

Bottom Line

If you’re ready to buy or sell – or maybe both – let’s connect to put your plans in motion. With low mortgage rates leading the way, it’s a great time to take advantage of your position in today’s market.

 

Sources:

1. https://magazine.realtor/daily-news/2019/03/11/ most-homeowners-planning-a-renovation-this-year

2. https://thriveglobal.com/stories/homeowners-are worth-46-times-more-than-renters/

3. https://www.rentcafe.com/blog/category/rental market/apartment-rent-report/

4.  NAR Homeownership Matters Program

5.  HUD Exchange – Department of Housing and Urban Development,  Twenty Interesting Facts About Home Ownership; Anthony Alfano