Despite homeownership being a pipe dream for many Americans, there is good news on the horizon. If you’re a first-time buyer and are still stuck on the sidelines, this may be the time to get started.
One-third of buyers in 2023 were first-time home buyers, below the historical average of 38%, according to the National Association of Realtors. In addition, the median age of first-time buyers was 35 years old. It is now less affordable than at any time in recent history to buy a home, and that isn’t changing any time soon – except for one interesting point.
When the Federal Reserve started raising rates aggressively two years ago to curb inflation, mortgage rates went up right along with all the other rates for borrowing money. Well, a funny thing happened on the way to 2024; rates started going down. The Federal Reserve stopped raising rates during the last several meetings, the stock market started going up and mortgage rates started heading to 7%. As of this writing, according to Forbes, the rate for a 30-year fixed rate mortgage was 7.26% and the rate for a 15-year fixed rate mortgage was 6.34%. Also, the Federal Reserve signaled it may cut interest rates next year and possibly have multiple rate cuts.
This may not help the housing shortage that has kept asking prices so high, but for those who can finally find a home, the carrying charges are starting to look more affordable, allowing more first-time buyers to qualify for financing. However, Gen Z and Millennials, the primary buyers of first-time homes, will continue to be facing a limited supply of single-family properties. This will put pressure on prices to stay elevated unless or until supply catches up.
Locally, there is more positive news. WalletHub.com, an online company that analyzes market trends, has placed Tampa as the best place to retire. In fact, their analysis places the five top best places to retire as Tampa, Scottsdale, Arizona, Fort Lauderdale, Orlando and Miami, four out of the top five in the state of Florida.
Just to be fair, U.S. News & World Report placed Tampa as #4 in their analysis as the best place to retire, moving up from #6. Both surveys are based on affordability, quality of life and health care.
And very close to home, imagine my surprise when about a month ago I opened the second page of the Wall Street Journal and found Cortez, Florida as the dateline in a good size news story.
The story was about the Hunters Point new construction on Cortez Road just east of the Cortez Bridge. Hunters Point single-family homes are all energy-efficient homes, explained by the developer as the first “net zero” single-family home development in the country. This means that the homes generate at least as much energy as they consume.
The homes have solar panels and a battery system to keep the power on even if the power grid experiences outages. They are also built with flood vents to accommodate rising water and living space that is about 16 feet above sea level. Hunters Point’s goal is to fight both the cause of climate change and carbon emissions while protecting their properties during major storm events.
It looks like little Cortez made the big time, and you can too if you start the new year with an optimistic outlook. In the words of Mark Twain, “The secret of getting ahead is getting started.” Happy New Year!
