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Home Buying
Home Buying, Money Management, Mortgage

Where More Young Residents Are Buying Homes – 2021 Study

Image shows two relatively young people changing the sign outside their home from "For Sale" to "Sold. SmartAsset found the places where more young residents are buying homes, based on 2009 and 2019 homeownership rates among residents younger than 35.

The homeownership rate in America peaked at a little more than 69% in 2004 before falling to 63.7% in 2016, according to U.S. Census data. Despite the fact that it has rebounded to a little more than 65% in 2019 overall, only 36.4% of Americans younger than 35 own their homes. It may be easier in some places, though, for this young cohort to buy homes. To that end, SmartAsset crunched the numbers to find the cities where people younger than the age of 35 are most likely to own their own home – and to see where this number has gone up in recent years.

To find the cities where more under-35 residents are buying homes, we compared the homeownership rate for this demographic in 2009 with the homeownership rate in 2019 for 200 of the largest U.S. cities. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

Key Findings

  • Young homeownership has decreased overall since 2009. While there are plenty of cities where homeownership among younger residents has increased, over the past decade the under-35 homeownership rate decreased by 3.71%, on average, across the 200 cities we analyzed.
  • Under-35 homeownership lags compared to that of older generations, particularly in large cities. Though some two-thirds of all Americans owned their homes in 2019, just one-fourth (26.15%) of residents younger than 35 did in the 200 cities we analyzed. Homeownership rates are particularly low for the under-35 set in America’s largest cities: of the 10 with the highest populations, nine are in the bottom half of the study for 2019 homeownership rate (only Phoenix cracks the top half at No. 67), and all 10 had decreasing homeownership rates from 2009 to 2019, with six out of 10 — Phoenix, San Jose, Philadelphia, Dallas, Houston, Chicago — ranking in the bottom half of the study for change in homeownership rate from 2009 to 2019.

1. Midland, TX

Midland, Texas has seen a 10-year increase of 17.11 percentage points in the homeownership rate among people younger than 35, the largest growth seen in this study. The total homeownership for that age cohort in 2019 was 52.42%, the fourth-highest rate we analyzed for that metric. Together, this makes Midland the top place where more young residents are buying homes.

2. Cape Coral, FL

The homeownership for younger Cape Coral, Florida residents in 2019 was 55.54%, the third-highest rate in the study for this metric. That’s an increase of 8.71 percentage points compared to 2009, the fourth-highest increase for this metric across all 200 cities we considered.

3. Joliet, IL

Joliet, Illinois, located about 30 miles southwest of Chicago, had a homeownership rate of 63.48% for under-35 residents in 2019, the highest rate of all the cities we studied. Joliet ranks ninth for the 10-year change in homeownership, increasing 5.48 percentage points from its 2009 rate of 58.00%.

4. Mesquite, TX

Mesquite, Texas is part of the Dallas metro area, and in 2019, the homeownership rate among residents younger than 35 was 45.46%. That ranks 11th in our study, but in 2009 the rate was just 35.47%, meaning the increase over 10 years was 9.99 percentage points, third place for this metric.

5. Bakersfield, CA

Bakersfield, in central California, ranks 20th for homeownership rate among younger people in 2019, at 39.75%. That’s a 10.01 percentage point increase over the 10-year period from 2009 to 2019, the second-highest jump for this metric in the study.

6. Aurora, CO (tied)

Aurora, Colorado ranks 15th for the 2019 homeownership rate among people younger than 35, at 42.28%. That is an increase of 5.29 percentage points from 2009, the 10th-largest jump we observed in the study.

6. Port St. Lucie, FL (tied)

Port St. Lucie, Florida has the fifth-highest homeownership rate among younger people in 2019, at 51.93%. It ranks 20th for its increase in that percentage from 2009, at 2.70 percentage points.

8. Gilbert, AZ

Gilbert, Arizona, located near Phoenix, has the eighth-highest homeownership rate among residents younger than 35, at 50.08%. That increased 2.69 percentage points since 2009, good enough for 21st place in that metric.

9. Fort Wayne, IN

Fort Wayne, Indiana ranked 17th in both of the metrics we measured for this study. The homeownership rate among those younger than 35 was 41.24% in 2019, a 3.32 percentage point increase over the previous 10 years.

10. Rancho Cucamonga, CA

The final city in the top 10 of this study is Rancho Cucamonga, California, which ranked 21st for under-35 homeownership in 2019, at 39.39%. That is a 3.77 percentage point jump since 2009, the 14th-biggest increase we observed across all 200 cities in the study.

Data and Methodology

To find the cities where more young Americans are buying homes, SmartAsset examined data for 200 of the largest cities in the U.S. We considered two metrics:

  • 2019 homeownership rate for those under 35. This is the homeownership rate among 18- to 34-year-olds. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.
  • 10-year change in homeownership rate for those under 35. This compares the homeownership rate among 18- to 34-year-olds in 2009 and 2019. Data comes from the U.S. Census Bureau’s 2009 and 2019 1-year American Community Surveys.

First, we ranked each city in both metrics. Then we found each city’s average ranking and used the average to determine a final score. The city with the highest average ranking received a score of 100. The city with the lowest average ranking received a score of 0.

Tips for Buying a Home

  • Never too old for some expert guidance. No matter what age you are, buying a home is a big step, and a financial advisor can help you get ready to take it. Finding the right financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in five minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
  • Meticulous mortgage management. Chances are you’ll need a mortgage to facilitate buying your home. Use SmartAsset’s free mortgage calculator to see what your monthly payments might be based on your financing rate and down payment.
  • Taxes don’t always have to be taxing. If you’re moving to one of the cities on this list, your tax burden might change. Use SmartAsset’s free income tax calculator to see what you’d owe the government each year if you pick up stakes and move.

Questions about our study? Contact press@smartasset.com.

Photo Credit: © iStock/valentinrussanov

The post Where More Young Residents Are Buying Homes – 2021 Study appeared first on SmartAsset Blog.

Source: smartasset.com

Home Buying, Law

Expert Homebuying Tips for Buying in a Seller’s Market

Buying a house is a big decision, but it can feel especially overwhelming to place an offer on a home less than 24 hours after seeing it for the first time. Plus you’re under pressure to outbid several other buyers — or risk losing the house.

While these circumstances might sound extraordinary, they’re not. With housing inventory nationwide at an all time-low — down 22% from last year according to the National Association of Realtors — it’s no wonder buyers are competing for the same few houses.

I was in this exact position last fall. Here are seven key takeaways from my experience buying in a seller’s market.

Get a Pre-Approval Letter

In order to be competitive in a hot seller’s market, you will need to line up your financing in advance.

Besides all the usual suspects, like saving up for a down payment and improving your credit score, you’ll also want to get a pre-approval letter from your bank. It states that a bank would approve you for a mortgage of a certain amount, and acts as a guarantee to the seller that you can actually afford to buy their house.

This is where it helps to know your budget up front.

“It’s important to understand that the strength of financing is a key consideration a seller takes into account when selecting an offer,” said real estate developer Bill Samuel.

No seller wants to risk accepting an offer that might fall through. Aand since pre-approval letters can take some time to get, have one ready before you find your dream house.

Be Friendly With Neighbors

This might sound crazy, but making a good impression on your new neighbors can actually make a difference when it comes time for a seller to review offers.

Since you’ll likely be visiting the home at least once before making an offer, be prepared to talk to any neighbors you might run into. In close-knit neighborhoods, or ones where people share resources (like an HOA), sellers might care a bit more about the type of person they sell the house to.

If you happen to meet a neighbor when visiting the home, introduce yourself and make a good impression. You never know how much their opinion of you might factor into any final decisions.

Submit an Offer Quickly

After you’ve seen a house, and decided you love it, be prepared to submit an offer quickly— as in, ASAP.

Work with your real estate agent to determine how many other offers the seller already has (or expects to get) and then be prepared to draft something up that day. In our case, we toured our home for the very first time at 11 a.m. on a Monday — it came on the market the evening before — and made an offer by 4 p.m. that same day.

If that sounds fast, it is. But by the time we submitted our offer, the seller already had three others. This is where it helps to have a great real estate agent on your side.

“Having a realtor who can get your offer submitted quickly is crucial,” said Erik Wright, owner of New Horizon Home Buyers. “You want to get your offer in front of the seller first, and make it strong. Purchase price is the obvious factor and in a competitive market, houses often go for over asking price. However, a strong offer has several factors and it depends on what’s most important to the seller.”

Work with your real estate agent to find out what matters most to the seller — is it money, closing quickly, something else entirely? Then make sure your offer addresses their needs.

Minimize Your Contingencies (Within Reason)

Another way to win over your seller (and prevail in any bidding wars) is by keeping your contingencies to a minimum.

Contingencies are the contractual stipulations buyers and sellers must meet before the deal can close. Unsurprisingly, sellers don’t like to have too many of them to deal with. Contingencies can include such things as requesting a seller to make certain repairs, getting a home inspection, or even the fact that you’ll need to sell your old house before being able to buy the new one.

“In a really aggressive seller’s market, a home buyer who has to sell a current property should do so before placing an offer on another home,” said Jason Gelios of Community Choice Realty. “Don’t always assume that the seller will take the highest price. Other conveniences can play a factor in gaining the seller’s attention, especially things like faster closing times and less restrictions.”

While my partner and I didn’t make the highest offer on our house, we did have the fewest contingencies — mainly, we didn’t ask too much of our seller in the way of repairs, or have another house to sell in order to afford the new one.

All that said, there are certain contingencies you should never forgo, and a home inspection is one of them. Getting your home inspected is hugely important, since inspectors will often find things even the sellers weren’t aware of. No matter how much you love a house, don’t be afraid of exercising your right to an inspection.

According to buyer protection laws in most states, sellers are required to report any findings in home inspections to subsequent buyers. In other words, if an inspector finds something wrong with the house, the seller will have to deal with it one way or another— either with you, or the next buyer should you choose to drop out of the deal.

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Make a Generous Earnest Money Deposit

When trying to woo your seller in a competitive market, it helps to make a generous earnest money deposit. An earnest money deposit is a good-faith deposit requested by the seller when you enter into a contract to buy the house and typically run anywhere from 1% to 3% of the sale price of the home.

When deciding how much of an earnest money deposit to include in your offer, keep in mind that whatever amount you give comes off the price of the home (and is returned to you if the deal falls through). In other words, there’s no reason to be cheap. If you can, go slightly above the seller’s requested deposit amount. Even if it’s just a little more than what they’re asking, that gesture of good faith might just be what gets you the house.

A row of houses on a cul de sac in a suburban neighborhood.

Offer Above Asking Price

Wait. Why would anyone make an offer that’s above asking price? Because the competition did it first, and in a hot seller’s market, offering above asking price is often what it takes to even be considered.

Upping your offer may not break the bank as much as you’re fearing. “With interest rates so low these days, offering more than what the seller is asking may not make a drastic difference in your overall monthly payments,” real estate agent Pavel Khaykin of Pavel Buys Houses said.

Let’s say the listing price on your dream home is $320,000 and you’re able to put down a 6% down payment. That leaves you with a mortgage of roughly $301,000. For a 30-year fixed mortgage at an interest rate of 3%, that translates into $1,269 monthly payments. Now let’s say you decide to bid a little higher on the home and offer $10,000 over asking price. This would only bump up your monthly payment (assuming you qualify for that low interest rate) by $42.

Lace Up Your Running Shoes

In a hot seller’s market, you’ve got to be ready to move fast. Often this is more of a change in mindset than anything else. When my partner and I first started looking at homes, we considered ourselves casual buyers — that is, until our dream home came on the market late one Sunday night. From there, things moved quickly. We saw the home, made an offer, were under contract by morning, and spent the next month and a half going through the process of closing on the house.

If you’re serious about finding your dream home in the next few months, the best thing you can do is know what you want from the outset, and get your ducks in a row to make a compelling offer when you find it. Maybe this means making a list of your must-haves in a house, and working to improve your credit score. It might also mean reaching out to a real estate agent before you need one, and getting that pre-approval letter in place.

Although inventory is low, new houses come on the market all the time.

Larissa Runkle is a contributor to The Penny Hoarder.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

Source: thepennyhoarder.com

Home, Home Buying

Pulte Mortgage Review

A wholly-owned subsidiary of PulteGroup since 1972, the third-largest homebuilder in America, Pulte Mortgage gives customers a financing option that differs from those of banks and online lenders.

As an imprint of the larger conglomerate, Pulte Mortgage leverages construction experience and a personal touch to take borrowers through the home purchase process, helping them understand their options and decide on the best mortgage loan for them. This is done through a personal loan consultant assigned to individual accounts.

While Pulte Mortgage does not have a profile on the Better Business Bureau’s webpage, the PulteGroup has an A- rating, though it is not accredited.

Pulte AT A GLANCE

Year Founded 1972
Coverage Area Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington
HQ Address 3350 Peachtree Road, NE, Atlanta, GA 30326
Phone Number 1-(866) 236-8165

Pulte Company Information

  • Part of the PulteGroup, the third-largest homebuilder in the United States
  • Based in Atlanta, the financing branch has served 400,000 borrowers across the country since 1972
  • Offers consumers a streamlined and integrated process, bringing a great deal of construction and lending experience
  • Has a broad menu of conventional, jumbo and government-backed loans, as well as specialty products
  • Assigns personal loan consultants to help guide borrowers understand mortgage rates and other specifics
  • Hosts a mortgage learning center for borrowers that includes a calculator, a glossary, and other resources

Pulte Mortgage Rates

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The first step to a new home is doing the numbers and finding out how much you can afford.
Mortgage Experts are available to get you started on your home-buying journey with solid advice and priceless information. To find out more, click on your state today.
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View Rates

Pulte Mortgage Loans

Customers who are building homes through one of the approved PulteGroup builders can access loan products including:

Fixed-rate mortgages

Usually offered in 15- and 30-year terms, these mortgages feature a fixed rate throughout the life of the loan, ensuring a steady monthly payment that is easily budgeted for. Fixed-rate mortgages are generally best for homeowners who expect to settle down in their residence or just want the dependable structure. Pulte Mortgage has fixed-rate offerings with both low- and no-money-down payment requirements.

Adjustable-rate mortgages

Typically called ARMs, these mortgages have an interest rate that fluctuates with market conditions. These loans are ideal for borrowers with short-term housing plans who may move soon after closing.

Since interest rates are generally lower for ARMs, these products may be a good fit for those looking to make a profit, yet although rates are initially low with ARM loans and they remain fixed for a specified number of years, the risk of rates increasing with market fluctuations after the initial period exists.

The terms of these loans usually include a fixed rate for an introductory period that is rebalanced yearly, bi-annually or monthly. While traditional ARMs stay fixed for six months and are thereafter recalculated at the same interval, hybrid ARMs offer longer fixed terms, like 5/1 or 7/1 options, that are fixed for five or seven years respectively and rebalanced each year.

Jumbo mortgages

Sometimes consumers need higher loan amounts than traditional, conforming mortgages can offer, which are limited to $453,000. Homeowners who build their own homes or purchase homes in high-cost areas may need more robust financing options, which is where a jumbo loan comes in. These mortgages often cover loans between $453,100 and $2 million.

FHA mortgages

These loans are backed by the Federal Housing Administration (FHA), which allows for less strict qualification requirements to incentivize homeownership. With FHA mortgages down payments can be as little as 3.5 percent, while low credit isn’t an automatic disqualification.

VA mortgages

Veterans Administration-backed mortgages are intended for veterans, active-duty personnel, and qualifying spouses of those who have served in the military or armed forces. Little to no down payment may be required for these types of loans. 

Balloon mortgages

While most borrowers are familiar with mortgages that are paid for incrementally, balloon mortgages are the opposite. These types of mortgages are paid in lump sums over a shorter period of time typically spanning five to seven years but may feature a lower interest rate than a fixed-rate option. At the end of the mortgage, borrowers must refinance or sell their homes, which is something to be aware of.

Bridge loan

While Pulte Mortgage does not offer home equity loans or lines of credit, it can extend bridge loans. This product is a type of the second loan that uses the borrower’s present home as collateral, earmarking the proceeds for closing on a new house before the present home is sold.

Pulte Mortgage does not offer cash-out refinancing options or USDA loans, which are government-backed loans that incentivize rural homeownership through low down payments.

Pulte Mortgage Customer Experience

The idea behind Pulte Mortgage is to streamline the mortgage process for consumers, so it’s more effective and efficient. In that spirit, the mortgage process for borrowers is straightforward with lots of assistance available on the way. Pulte highlights its five-step process:

  1. The mortgage application is started either through a secure online portal or through the mail. A Pulte Mortgage team is also assigned at this point.
  2. The personal loan consultant contacts the borrower to talk about important information, determining personal needs and locking in a rate.
  3. The loan is processed, and credit approval is communicated.
  4. The closing date is set with a builder representative, while the loan processor coordinates necessary actions.
  5. The keys to a new home are ready!

Prospective borrowers who just want to do some research can also benefit from Pulte Mortgage’s resource library, which includes:

  • A calculator that helps determine the buying power
  • A glossary for mortgage terms you’re likely to encounter through the process and should be familiar with
  • A mortgage FAQ for specifics on homebuying and financing

Pulte Company Grades

Although Pulte Mortgage does not have a profile with the BBB, PulteGroup, its parent company, has am A- rating with the organization. Though the company is not accredited by the BBB, Pulte Mortgage has been in business since 1972.

Pulte Mortgage Underwriting

Pulte Mortgage does not publicly disclose its down payment or qualification requirements on its website. Customers who are building with Pulte Homes, or one of the associated PulteGroup brands, can access this information once they complete the mortgage application.

History of Pulte Mortgage

Not only is PulteGroup the third-largest homebuilder in the United States, but it’s also been financing mortgages since 1972. Thanks to a little horizontal integration, PulteGroup can assist homeowners from construction to mortgage closing through Pulte Mortgage, the wholly-owned subsidiary that offers loan products.

The selling point is Pulte Mortgage being a one-stop-shop for homeowners, informed by extensive residential construction and mortgage financing experience.

Pulte Mortgage finances new home construction for customers of Pulte Homes, Centex, Del Webb, DiVosta, and John Wieland Homes, which all fall under the PulteGroup umbrella. Personalization is a key focus, with personal loan consultants for each borrower.

It also has an extensive online learning center to help prospective homeowners become familiar with different loans it offers, including conventional, jumbo, FHA, and VA loans, as well as specialty products like balloon mortgages and bridge loans.

Bottom Line

PulteGroup can assist homeowners from construction to mortgage closing through Pulte Mortgage. Many customers enjoy the fact that Pulte Mortgage is a one-stop-shop for homeowners, informed by extensive residential construction and mortgage financing experience.

For more information visit their website.

The post Pulte Mortgage Review appeared first on Good Financial Cents®.

Source: goodfinancialcents.com