A surprising trend in today’s market: A quarter of all home buyers are singles.
More consumers are opting to live alone, with single buyers making up a quarter of all home purchases, according to the National Association of Realtors. In the U.S., there are 33 million one-person households, and living solo is becoming an international trend.
“Why are so many living alone? People are marrying later, divorcing more, and living longer, sociologists say,” the report noted.
“Eric Klinenberg, a sociologist and author of ‘Going Solo: The Extraordinary Rise and Surprising Appeal of Living Alone,’ says that young adults ages 18 to 34 are the fastest-growing group of people living alone. Solo households are also mostly women: 18 million women live alone versus 14 million men. The majority of solo households are in cities and metro areas.”
One-person homeowners may be drawn to more low-maintenance homes, but for resale reasons, they still place a high value on being in a highly rated school district, agents say.
Being a single buyer can pose challenges, particularly in a post-recession market. Qualifying for a mortgage may be the biggest obstacle for single buyers, since they don’t have the advantages of dual incomes or shared responsibly that a two-person household does.
Q: Are home sales picking up?
A: “This July saw a healthy jump in homes sold throughout most of the 19 markets covered in the Redfin report,” improving 3 percent month-over-month and 17.6 percent year-over-year from a rather disappointing July 2012.
In fact, Redfin found July 2013 experienced the highest number of homes sold in the past four years, with the 19 markets together seeing about 94,000 sales. While sales numbers picked up, Redfin believes the gains won’t last.
At the same time, reports on home price growth and inventory were less positive in July.
Q: Is it true that an increasing number of homes are slipping underwater?
A: RealtyTrac, a housing data site, recently released its U.S. Home Equity & Underwater Report for September 2013.
It shows that while 10.7 million residential homeowners nationwide owe at least 25 percent or more on their mortgages than their properties are worth, another 8.3 million homeowners are either slightly underwater or slightly above water, putting them on track to have enough equity to sell sometime in the next 15 months, without resorting to a short sale.
Q: What’s the mess-up in Fannie Mae’s reporting system all about?
A: Because of a shortcoming in Fannie Mae’s software, many homeowners who sold their homes through short sales have suffered undue harm to their credit and additional penalties preventing them from attaining new mortgage loans for several years, according to U.S. Sen. Bill Nelson, who has been working toward a solution to the problem.
Fannie Mae’s software reportedly does not offer a “short sale” label, and therefore short sales have been labeled as foreclosures in the GSE’s system.
Q: Is the supply of foreclosed homes diminishing?
A: Yes. As the housing market heals, foreclosure inventory is depleting quickly, CoreLogic reported. In July, about 949,000 homes were in some stage of foreclosure, down 32 percent from 1.4 million a year ago.
According to the data provider’s estimate, about 49,000 properties were lost to foreclosure in July, down 25 percent from 65,000 in July 2012. At 5.4 percent, the serious delinquency rate decreased to the lowest level since December 2008, according to CoreLogic.
Q: Is the number of mortgage applications dropping?
A: Applications have experienced many ups and downs in recent weeks, but mortgage applications increased 1.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.
The Market Composite Index, a measure of mortgage loan application volume, increased 1.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.3 percent compared with the previous week.
The Refinance Index increased 2 percent from the previous week. The seasonally adjusted Purchase Index decreased 0.4 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 6 percent higher than the same week one year ago.
The refinance share of mortgage activity increased to 61 percent of total applications from 60 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7 percent of total applications.