Despite the challenging circumstances for buyers in the current market with limited inventory, first-time buyers are still engaged in the process.
Sixty percent of first-time buyers said they plan to purchase a property in the next 12 months, a Chase Home Lending First-Time Homebuyer Study found. Additionally, nearly 70% of first-time buyers said homeownership helps build wealth. Consumers also said they want to buy a house for larger living spaces, space for family and financial independence.
However, many first-time buyers are facing the same struggles that predated the pandemic. Three-quarters of respondents said they could not financially afford a home in the first half of 2021. Additionally, 70% of first-time buyers said the pandemic influenced their homebuying decisions and were waiting to see how the market was impacted. Six in 10 said a change in income and 58% said financing their home influenced their homebuying process. In fact, 41% said they are less confident about buying a home, most likely due to less income and 37% said this less income has led to a budget decrease.
Yet, first-time buyers said they are still motivated to buy. Seventy-seven percent are actively saving for a down payment, 70% are making lifestyle changes to be able to buy a home and 66% are budgeting while trying to improve their credit score.
For Black and Latinx first-time buyers, 69% feel that owning a home is an important step to building wealth. Black and Latinx respondents were more likely to feel knowledgeable and comfortable with the homebuying process and expect it to be enjoyable than the overall percentage of respondents. Additionally, Black and Latinx buyers are more likely to be looking to list neighborhood safety as a top desired feature, as well as be looking for a property in an urban area.