Challenges of first time house buyers in USA in 2022

Challenges of first-time house buyers in USA in 2022

First quarter 2022 has been CHALLENGING for house buyers in United States. 94% of the prospective buyers have been unqualified or unprepared due to credit problems, marital problems, evictions, high debt to income ratios, nothing or very little saved for buying a home, high student loan debt, high automobile debt, unpaid taxes, short time on their jobs, didn’t give themselves enough time for the home buying process. Your lease can’t be up at the end of February and you expect to buy and move into a house on March 1st.

Extremely low inventory of homes, and frustration with new construction homes that in many cases will take a year and a half to two years before their home is ready.

Challenges of first-time house buyers in USA in 2022.

Those who are “qualified”, are afraid of the market and are “waiting for a crash” that isn’t coming any time soon, or have been given pre-approval amounts that are so low that it’s nearly impossible for them to find homes they like or can compete for when most homes are receiving multiple offers from cash and conventional loan buyers and investors.

Many realtors are experiencing these challenges this year.

There are only about 250,000 houses currently for sale across the U.S. that are considered affordable for households with between $75,000 and $100,000 in annual income — a sharp decline from the roughly 656,000 homes available prior to the COVID-19 pandemic, a recent analysis by the National Association of Realtors found.

The typical first-time buyer has household income of about $90,000 — but people in expensive markets or towns that are witnessing double-digit price appreciation may find it more difficult to find properties within their budgets.

So far, inventory levels aren’t improving in early 2022, adding to the headache of navigating the property market. Active listings, or the number of homes for sale, plunged 24% last month, reaching an all-time low of 456,000 properties, Redfin said.

At the same time, properties are selling fast as buyers compete to capture a home quickly, with 6 in 10 homes under contract receiving an offer within the first two weeks on the market, Redfin added.

“Why this is concerning is [higher home prices] come at a time when inflation is already taking a bigger bite out of most American’s monthly paychecks,” Ratiu said. “First-time buyers are going to feel a lot of pressure.”

Affordability is likely to remain an issue, especially for first-time homebuyers in hot housing markets like Austin, Texas or Las Vegas, senior economist George Ratiu said.

“To see that number at a record high in February is a real signal that the spring season is really starting much earlier,” Ratiu said.

“To me,” he added, “the real concern — and this is a real challenge, especially for first-time homebuyers — is that today’s buyer of a median-priced home, at a 3.89% mortgage, is paying over $300 a month more on their mortgage than they did a year ago.”

A 30-year, fixed-rate loan averaged 3.76% for the week ending March 3, according to Freddie Mac. A year earlier, the average rate was 3.02%.

The biggest price hikes in listings were in southern and western cities, including Miami, where asking prices rose almost 32%, and Las Vegas, where the median listing price jumped almost 40%,’s data found.

“First-time buyers in these markets will face challenging conditions,” Ratiu noted.


Challenges of first-time house buyers in USA in 2022