The top concern for homebuyers is affordability, according to a survey of 975 buyers conducted by Redfin last month. Over a quarter of respondents (26 percent) were concerned about not being able to afford a home – virtually unchanged from the last two quarterly surveys.
Affordability concerns were followed by competition woes. One in five homebuyers believed that bidding wars are the biggest obstacle they face when house hunting. The 19 percent of respondents who cited competition is an increase of 8 percent from the survey conducted in the fourth quarter of 2015.
Roughly a quarter of homebuyers claim high rent costs are pushing them to buy a home. "Though enticed by high rents and low mortgage rates to begin a home search, first-time buyers face a number of obstacles in today's competitive market," said Nela Richardson, Redfin's chief economist. "In many cities, starter homes have seen the largest price increase. The demand for these homes is so high."
Meanwhile, conforming no-point 30-year fixed mortgage rates average 3.625 percent while the 15-year rate is near 2.875 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.