The number of homes for sale for each renter household in the U.S. remains near record lows, highlighting the supply crunch that first-time buyers face in the current housing market. Currently, there are about 30 renter households for each available home for sale, up from less than 10 in 2006, according to Freddie Mac's latest market outlook report. The supply shortage dates back to the Great Recession, which dealt a major blow to new home construction.
Affordability also remains a key struggle for first-time buyers. The report found that between January 2000 and July 2024, cumulative entry-level prices grew 63% more than high-end home prices, meaning that start-home prices are growing faster than the rest of the market. Less affordable housing is acutely felt by those seeking to buy their first homes, especially those without substantial wealth at their disposal.
The current housing market has become one of the most punishing on record for first-time buyers due to high mortgage rates. After dipping in September, the average rate for 30-year fixed mortgages has risen for four straight weeks, hitting 6.54% for the week ending on Thursday, according to Freddie Mac. A recent survey from LendingTree found that more than half of renters fear the dream of home ownership is out of reach.
Among renters who say they would prefer to own, cost is the biggest barrier. Of this group, 65% say the cost of a down payment is holding them back from purchasing, highlighting the financial strain many face as they attempt to navigate this challenging market.
Collection
[
|
...
]