A quarter of first-time buyers said their biggest challenge was saving for a down payment. Of those, a majority said student loans were the main obstacle… although lenders are loosening home-loan requirements, some are still eschewing borrowers who would qualify under the mortgage-finance company’s guidelines but are on the riskier end of the credit spectrum.. [also,] a large number of first-time buyers and other borrowers aren’t applying for loans because they don’t think they would qualify, even if they are likely to get approved.
“Among millennials and people generally, folks are living more conservatively than they did in the past. They are managing their affairs in a very cautious way,” [Fannie Mae’s] Mayopoulos said. “What we’re experiencing is a little bit of a natural reaction to this very difficult economic period that we went through.”
Economists also said rents, which have jumped 20% over the last five years, have made it difficult for younger households to put money aside [, plus] tenants … are paying rents “considered commensurate with a mortgage payment” to live near good restaurants, shorten their commutes and enjoy amenities such as having their trash picked up right outside their doors.”
But the following is the most hilarious, schadenfreude-stoking part, for us:
Many economists predicted 2015 would be the year when first-time buyers would finally make a comeback, as job and income growth accelerated, mortgage rates remained low and the memory of seeing relatives battered by the housing bust started to fade.
“I thought we would see some pick up in the first-time buyers given that the economy has been expanding for years,” said Lawrence Yun, NAR’s chief economist. But “there are some hurdles to overcome.”
Yes, you read that right: NAR cheerleader (woops, sorry, cheer-conomist) Lawrence Yun is stumped — STUMPED — that the foundation of the housing market has not come roaring back from the great recession. Well, maybe he should have spent a little of the past seven years forcing himself, Clockwork Orange-style, to read ML-Implode occasionally, and he would have known that the foundation of the economy simply has not come back — and probably never will, until our monetary and banking system are up-ended. Had he noted this simple truth (which many other, actually-competent economists have noted), he would not be surprised that first time home buyers have not swooped in and played their part getting the housing market “animal spirits” flowing again…