A recent report from the National Association of Realtors (NAR) reveals that the average age of homebuyers is 45 this year, compared to 31 in 1981. This increase reflects the various difficulties Americans face when looking for a home, such as the historic housing crisis, the pandemic, and wood shortages. These issues have caused a rapid decline in available homes, making it difficult for buyers to find a suitable property. The debt-to-income ratio (DTI ratio) is a metric used by mortgage companies to determine if you can afford a mortgage. Millennials have been particularly affected by this, as they have struggled to save for a down payment due to the aftermath of the financial crisis, high student loan debt, and expensive living costs.
As a result, fewer people in their 20s and 30s are choosing to buy a home. The most opportune time to buy a home is between 25 and 34 years of age, according to a recent study. To help local residents find affordable housing, many states offer programs through their State Housing Finance Agency. These programs provide a second mortgage for the down payment and require monthly loan payments for a term of 10-15 years.
However, 53% of respondents reported that they couldn't pay the down payment and a third said they didn't qualify for a mortgage. Those who bought homes before age 25 got the most benefit from their housing investment. Alternatively, some people choose to rent or invest in rental properties to generate valuable cash flow.
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