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With rents on the rise in many areas, are renters looking to make to move to homeownership? Not so, according to a study commissioned by Freddie Mac (Study).
In the past, many consumers rented a home or apartment until they could save enough money, and have sufficient income, to afford to buy a home. That is the American Dream. Is that now changing?
Today, many people choose to continue to rent regardless of recent rent increases. One main reason is the freedom from the additional expenses associated with homeownership. Other reasons include the challenge of coming up with a sufficient down payment and protection against loss from a decline in home values.
Does this change in attitude represent a shift in the culture of future home buying? Is the lure of putting down roots, building equity and benefiting from tax deductions waning? Only time will tell. For now there are still a large number of consumers who want to pursue the dream of homeownership. But, are we maxing out?
Loading ...Every cloud has its silver lining. With more and more people wanting to rent, the opportunity for home sales and financing to investors is on the rise. The increased demand for rental housing, aided by the popularity of some reality TV shows, has investment property ownership on the rise.
Lenders should be looking for ways and products to service these buyers. As investment properties are not subject to the lending rules under TILA and RESPA, lenders need not worry about all the noise surrounding QM, ATR or TRID. They can go about good old fashioned property lending providing the financing needed by these investors to purchase property for their use as rental housing. Another arrow in the quiver! Another product line to generate income!
Rather than be consumed by the challenges of lending to more low to moderate income, first-time homebuyers, a sluggish primary home market, and increased regulations and costs – add investment property lending to your repertoire. It may be the silver lining you’re looking for…
The game keeps on changing; continue to play different.
