93% of Young Adults Plan to Buy a Home

It is believed, that young adults between the ages of 18-34 will be a major percentage of all buyers purchasing a home in 2013. Some believe we are overestimating the millennials’ believe in homeownership. However, a new study by Trulia reveals we may be dead on. Regarding young adults, the study reports:

43% are already homeowners
93% that currently rent plan to purchase a home
72% say homeownership is part of their personal American Dream

Jed Kolko, Trulia’s Chief Economist, explained:

“Millennials have been shaken, not scarred by the housing bust. Nearly all of them want to own a home someday, if they’re not homeowners already. But many of them think today’s low prices and low mortgage rates will last. They may be in for sticker shock if the cost of homeownership has returned to normal levels by the time they’re ready to buy.”

If you are a young adult waiting to buy, you must realize that the price of a home and the cost of a mortgage are both projected to increase in the next 12 months.

Source: The KCM Blog:
Posted: 18 Dec 2012 04:00 AM PST

2 Home Buying Tips

1. Start by polishing up your credit.
Since you most likely will need to get a mortgage to buy a house, you must make sure your credit history is as clean as possible. A few months before you start house hunting, get copies of your credit report. Make sure the facts are correct. Fix any problems you discover. This is where I can help.

2. Get professional help.
Even though the Internet gives buyers unprecedented access to home listings, it's still a good idea to use an agent. I work with knowledgeable real estate professionals who will have your best interests at heart and can help you with proven strategies during the bidding process.

Conforming Loan Limits Will Remain at 2012 Levels

On Thursday, November 29, 2012, the Federal Housing Finance Agency announced that the maximum dollar limits for conforming loans will remain at 2012 levels for Freddie Mac and Fannie Mae in 2013. This applies to one unit properties across the country, however some "high cost" areas may have limits as high as $625,000. Multi-unit loan limits will also remain the same, as these are "simply multiples of the one-unit limits."

How are loan limits established?

Loan limits are determined by the median home values in local areas, and are established annually under the terms of Housing and Economic Recovery Act of 2008.

This method applies to both the determination of conforming limits and limits for higher cost areas.

Why did 2013 loan limits remain unchanged from 2012?

While recent Home Price Index numbers have increased, they have not fully offset the "cumulative decline in prior years." For example, the U.S. home price fell "more than 19 percent through mid-2011," and under the rules of HERA, the prior declines in price must be "fully offset before loan limits can increase."

What is the bottom line?

The bottom line is that now is a great time to consider a home purchase or refinance, as home loan rates remain near historic lows.