Published by FOX Business on July 18, 2020
Some have been saving for a home since the end of the Great Recession
Americans are fleeing big cities as the COVID-19 pandemic sparks a newfound appreciation for socially-distanced space in the suburbs.
The mass migration has created an opportunity for millennials and other first-time home-buyers, in particular, to take advantage of record-low mortgage rates and work-from-home opportunities, as long as they can outbid their peers in the urban diaspora.
“It is a competitive environment among buyers,” Dr. Lawrence Yun, chief economist at the National Association of Realtors, told FOX Business. “The good news is that mortgage rates are low.”
A red-hot housing market despite the coronavirus downturn has left buyers with little inventory to choose from and has led to multiple bidders driving up the average home price by 5 percent nationwide, compared with last year.
However, record-low mortgage rates mean the average monthly payment for a medium-sized home has fallen 7.36 percent nonetheless — to $1,007 in May, down from $1,087 the year prior.
The 30-year fixed mortgage, which during the week ended July 16 dipped below 3 percent for the first time, is a “great incentive for first-time homebuyers,” Jerry Howard, CEO of the National Association of Home Builders, told FOX Business’ Stuart Varney.
There is still “pent-up demand” from millennials who have been saving up since the end of the Great Recession, Howard noted, and being “cooped up in an apartment” during the pandemic has given them an incentive to explore their options.