Many Big-City Renters Qualify for Homeownership.
Here in the Greater Phoenix Valley, rents have skyrocketed. In most cases I have found that folks who call me to find a rental are much better off buying a home. It’s not surprising really, that many people are under the impression that they can’t buy a home. The media has been relentless in the spreading of misinformation. Its likely easier than you think to qualify for a mortgage and some mortgage companies are making it easier still. There are loans for folks with low credit scores, interest rates are low, down payment assistance available, and help with closing costs. Call me for more info… I research this stuff and talk with lenders almost every day. 602-999-0952
Across the country’s largest rental markets, almost 14 percent of on-market renters have strong credit scores, relatively high incomes and could afford to buy the median home in their market.
As the homeownership rate has declined over the past decade, a broader socio-economic swath of Americans are renting than at any time in recent history. That means people who could afford to buy are renting instead, increasing competition for limited available homes for rent, according to an analysis of financial qualifications reported via the Zillow® Renter Profile feature.
San Jose, San Diego, and San Francisco have the largest segments of on-market renters who have the credit score and income necessary to purchase a home, making those metros highly competitive for renters. Los Angeles, New York and Seattle also made the list of metros with large segments of current renters who are financially qualified to buy a home.
To determine which markets have the highest number of financially stable and thus most competitive renters vying for the attention of landlords and property managers, Zillow examined the self-reported credit scores and incomes of renters who were on the market during the first half of 2016. Zillow also looked at regional median rental and home values and competition to determine the markets with the highest share of renters who reported a monthly income equal to or greater than necessary to afford the typical rental and median home in the metro area.
There are also long-term demographic trends impacting renter qualifications and competition: young adults, both the affluent and otherwise, are renting longer than ever before as they delay many of the hallmarks of adulthood that typically lead to homeownership, such as finishing their education and starting families.
In general, markets with lower homeownership rates have higher proportions of on-market renters with both strong credit and high incomes. That said, even when controlling for the homeownership rate, booming markets closely associated with the tech industry – such as San Jose and San Francisco – tend to have exceptionally high proportions of highly qualified, on-market renters.
At the other extreme, markets that tend to have higher homeownership rates, such as Houston, and metros that were particularly hard hit during the housing bust and foreclosure crisis, including Cleveland and Detroit, have lower shares of renters who report both strong credit and high incomes.
“When faced with hurdles of high prices and low inventory, first-time homebuyers are renting longer than ever before even if they are qualified to buy,” says Zillow Chief Economist Dr. Svenja Gudell. “San Jose, San Diego and Seattle are among the most competitive places for buyers, and the going isn’t any easier for renters – as they are competing against throngs of financially sound applicants with strong credit and high incomes. This is a conundrum for many young people who move to those cities because of their strong job markets, only to find tight inventory and steep competition standing between them and their dream home.”
For more information, visit www.zillow.com. Reprinted with permission from RISMedia. ©2016. All rights reserved.
There are still down payment assistance programs available in Maricopa and Pinal Counties. These are grants, NO repayment necessary. Call us for details: 602-999-0952
We also have options to help with your closing costs. See the links below or feel free to call or email for additional information: 602-999-0952 / golfarizona@cox.net
Learn more about the Arizona Heroes Home Advantage cash-back program. NO cost, NO pre-registration, NO obligation.
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