Real estate news: 05/28/22 | Immovable
South Carolina’s young homebuyers are 13th least likely to need a cosigner
After two years of strong competition and rapid price increases in residential real estate, the market is finally showing signs of slowing down. Against a backdrop of higher prices and recent interest rate hikes, demand is stabilizing. Pending home sales have started to decline, online searches, viewings and mortgage applications are down, and many experts predict a rebalancing of the market over the next year.
While many buyers are beginning to feel relief, younger buyers have had a particularly tough time in this market and may continue to struggle. Millennials, or Americans between the ages of 26 and 41, are currently reaching their peak home buying age, accounting for 43% of buyers according to recent data from the National Association of Realtors. Because they are younger in their working lives, younger buyers may have saved less to buy a home, and they also tend to be first-time buyers, which means they don’t have of existing real estate capital available to finance a purchase. When the market was at its most competitive, it was more difficult to outbid buyers who had more resources. Today, with home prices reaching historic highs and interest rates rising, many young buyers are being shut out of the market altogether.
To overcome these challenges, some younger buyers have relied on older friends and family members with more financial resources to support the home purchase. This can happen informally, such as with giveaways for a down payment or closing costs, but support can also come in the form of a co-signer on a mortgage. Co-signers are people who agree to be responsible for loan payments if the primary signer defaults. Since the financial resources and credit history of co-signers are also assessed as part of a loan application, this helps buyers with lower incomes, more debt, or patchy work histories increase their likelihood of qualifying for a loan. a loan and receive lower or higher interest rates. approved amounts.
Young buyers seem to rely on older co-signers simply to enter the housing market, rather than using the financial assistance of co-signers to purchase more expensive homes. This is evidenced by similar home values and down payments among younger buyers with and without older co-signers, according to data from the Home Mortgage Disclosure Act. The median home value and down payment for young buyers with an older co-signer are $295,000 and $40,000 respectively, compared to $285,000 and $30,000 for all young buyers. But both groups of buyers overall lag behind typical numbers: for all buyers, the median home value is $325,000 and the median down payment is $50,000.
Co-signers are especially useful for younger buyers in markets that tend to be more expensive for housing. There is a positive correlation between the median home price in a state and the percentage of younger buyers with an older cosigner. The three states with the highest percentage of young buyers who have a co-signer — Hawaii, Colorado and California — rank first, fifth and second, respectively, in the United States for overall home price.
Because of the relationship between home prices and the presence of a co-signer, western and northeastern states that tend to be more expensive also tend to have younger buyers leaning more often on co-signers. In contrast, more affordable states in the southeastern and central US have fewer young homebuyers with a co-signer.
To determine which states have the highest percentage of younger homebuyers with an older cosigner, Porch researchers analyzed the latest data from the Federal Financial Institutions Examination Council’s Home Mortgage Disclosure Act. The researchers ranked states based on the percentage of younger homebuyers (34 or younger) with an older cosigner (55 or older). In the event of a tie, the state with the highest median real estate value for younger buyers with an older co-signer was ranked higher.
The analysis found that in South Carolina, 0.746% of younger homebuyers have an older co-signer on their mortgage, compared to 0.915% nationally. Of all the states, South Carolina has the 13th fewest young buyers using an older co-signer. Here is a summary of the data for South Carolina:
• Percentage of younger buyers with an older co-signer: 0.746%
• Median home value for younger buyers with an older co-signer: $210,000
• Median home value among all young buyers: $225,000
• Median down payment for younger buyers with an older co-signer: $20,000
• Median down payment for all young buyers: $20,000
For reference, here are the stats for the entire United States:
• Percentage of younger buyers with an older co-signer: 0.915%
• Median home value for younger buyers with an older co-signer: $295,000
• Median home value among all young buyers: $285,000
• Median down payment for younger buyers with an older co-signer: $40,000
• Median down payment for all young buyers: $30,000
For more information, detailed methodology and full results, you can find the original report on Porch’s website: https://porch.com/advice/young-buyers-relying-older-co-signers-buy -homes
New agents at Realty One Group Coastal
Realty One Group Coastal welcomed three new agents in the past month: Kate Joiner, Megan Jean Poston and Paula Odell.
Ever since she was young, Kate Joiner has loved shopping for homes online, whether she’s in the market to buy one or not. It didn’t take her long to realize that she had to turn this passion into a career. As she begins her new role at ROGC, she is excited to combine her love of real estate with her love of Charleston while helping you find the home that ticks all the boxes! Fun fact: Kate is also a registered nurse, mother of three, an experienced short-term real estate investor, and currently acts as her own general contractor while custom-building her dream home. Whatever your realtor needs, Kate has the versatility and tenacity to meet them.
Kate Joiner 7046205001 [email protected]
Megan Jean, Realty One Group Coastal, is excited to advance her career in real estate here in the Charleston area market. She has lived and purchased multiple homes for many years in various states which adds to her impressive knowledge and work ethic to provide the highest quality care and diligent work ethic to her variety of clients. She has lived in the Lowcountry since 2008. Her love for the Lowcountry life has only been reinforced here as an avid outdoorsman and foodie, while enjoying all the mixed cultures located only here and the real beauty of the Charleston area. As a mother of three and a social media guru, she has extensive experience in negotiation, time management and an incomparable passion. Her background in marketing, along with her training as a veterinary technician, enhances her abilities as a real estate agent to provide more exclusive insight, attention to her clients’ needs, miscellaneous details, as in veterinary medicine there is no are no two identical animals – no two homes or customers are. She is passionate and a true professional in finding the exact marketing strategy for your specific home or investment property, which is one of those extra qualities she offers besides her caring nature and spirit of commitment. company. His love for real estate is one of those found rare. She is determined to go above and beyond to ensure her clients get the right property. The right home can change a family or someone’s world and that’s as great a feeling as an agent can provide! Contact Megan Jean today.
Megan Jean Poston 662-420-8385 [email protected]
Paula Odell was a military kid, so she understands all too well how stressful moving can be. In 2003, she returned to Charleston to raise her boys and plant her roots. Odell had been running a successful cleaning business since 2004 until she decided to pursue her passion for real estate. Filled with a love for helping people and building relationships, Paula’s knowledge of the area ensures her ability to help her clients find the perfect home for them. If you are moving to the area, she would like to be your feet on the ground to help make the process as smooth as possible. Backed by an amazing broker with an extensive database of local and international marketing, together they can get you the most money in the least amount of time. If you are ready to sell, buy, or have real estate questions, please call him.
Paula Odell 843-532-6304 [email protected]