RICHMOND, Va., Aug. 21, 2019 /PRNewswire/ -- Genworth
Mortgage Insurance, an operating segment of Genworth Financial,
Inc. (NYSE: GNW), today released the 10th edition of the
First-Time Homebuyer Market Report, authored by its Chief
Economist, Tian Liu, for the second
quarter of 2019. The report aggregates all publicly available
government data and proprietary mortgage industry data into one
digestible report. The full analysis and chart pack can be viewed
at
https://miblog.genworth.com/first-time-homebuyer-market-report/.
Overview
- First-time Homebuyer Share Decreased: For the first
time, the year-over-year growth rate in home sales to first-time
homebuyers underperformed the overall single-family housing
market
-
- However, first-time homebuyers represented 36 percent of
all buyers in the single-family housing market and 55 percent of
new purchase borrowers
- Single-family home purchases decreased:
-
- 2Q'19: decreased by four percent from Q1 to a seasonally
adjusted annual rate of 1.94 million
- 559,000 single-family homes were purchased – a four percent
decline from 2Q'18
- Diverging Trends Across States: The slowdown spread to
43 states compared to 39 states in 1Q'19; Nine states reported
increased first-time homebuyer activity
- Housing affordability improved:
-
- The past three years saw a trend towards declining
affordability. That trend reversed in Q1 driven by a slowdown in
home price growth and falling interest rates. Housing
affordability continued to improve in Q2.
- The interest rate for first-time homebuyers decreased by 39
basis points to 4.51 percent, and is 50 basis points higher than
the 30-year mortgage rate as reported by the Freddie Mac Primary
Mortgage Market Survey®.
- Low down payments still preferred by first-time
homebuyers:
-
- Overall, 424,000 first-time homebuyers used some form of low
down payment mortgage products to finance their home purchase in
Q2
- PMI: Low down payment conventional mortgages,
enabled by the private mortgage insurance industry, helped 201,000
first-time homebuyers in Q2 – more than any other product; up six
percent compared to a year ago
"The contraction in the number of first-time homebuyers came as
a surprise because the overall housing market has seen a moderate
rebound compared to Q4'18," said Tian
Liu, Chief Economist, Genworth Mortgage Insurance. "Housing
affordability continued to improve, driven mainly by falling
mortgage rates, and also was supported by falling home price growth
and faster wage growth. While falling mortgage rates are the
result of higher economic uncertainties, and could negatively
affect buyer confidence, they are still a net positive for the
housing market in Q2. Low down payment mortgages remain at the core
of mortgage financing for first-time homebuyers, and we're
continuing to watch the shift away from government loan programs
toward conventional loans with low down payments."
About Genworth's First-Time Homebuyer Market Report
The First-Time Homebuyer Market Report is the only economic series
measuring the number of home sales and mortgages to first-time
homebuyers covering the entire housing market. This report provides
quarterly estimates of the first-time homebuyer market since the
first quarter of 1994—spanning two housing cycles and 24 years. It
provides a historical perspective necessary to understand today's
first-time homebuyer market. It is based on a sample size of 23.2
million first-time homebuyers from government reports and industry
data. By capturing the entire market over a long period, and
providing the latest market snapshot, this report makes the
first-time homebuyer market more visible to housing industry
participants and policymakers.
For access to the full report and charts, visit:
https://miblog.genworth.com/first-time-homebuyer-market-report/
About Genworth Mortgage Insurance
Genworth Mortgage
Insurance, an operating segment of Genworth Financial, Inc. (NYSE:
GNW), is headquartered in Raleigh, North
Carolina, and operates in all 50 states and the District of Columbia. Genworth Mortgage
Insurance works with lenders and other partners to help people
responsibly achieve and maintain the dream of homeownership by
ensuring the broad availability of affordable low down payment
mortgage loans. Genworth has been providing mortgage insurance
products and services in the U.S. since 1981.
Disclaimer
Opinions, analyses, estimates, forecasts,
and other views included in these materials are those of
Tian Liu, are based on current
market conditions and are subject to change without notice, do not
necessarily represent the views of Genworth or its management, and
should not be construed as indicating Genworth's business prospects
or expected results. Neither Tian
Liu nor Genworth guarantees that the information provided in
these materials is accurate, current, or suitable for any
particular purpose. Forward looking statements should not be
considered as guarantees or predictions of future events.
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SOURCE Genworth Mortgage Insurance