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These Are The Most Common Obstacles To Homeownership

Homeownership is at a 50-year low. There are many reasons why people aren't buying - according to a new report from the National Association of Realtors (NAR).

Existing home sales went up 3.8% in 2016 marking a 10-year high.But affordability, student debt and confusion about down payment requirements are still major obstacles for many people. 

NAR analyzed data from its Housing Opportunities and Market Experience survey to understand how housing expectations and sentiment among homeowners and non-homeowners, renters and those who live with a family member. 

Here we'll break down the report and debunk some common home buying myths.


About 80% of participants reported homeownership is still part of their American dream. But not many non-homeowners think now is a good time to buy (only 55% down from 63% in the first quarter of 2016). However, current homeowners are more optimistic - 80% say it is a good time to buy.

“Nearly all homeowners said they want to own a home in the future, 87% but it’s evident that higher rents and home prices, up 4% in the past five years along with limited entry-level supply and repaying student debt have combined to make buying a challenging goal."

- NAR Chief Economist, Lawrence Yun


The primary reason non-owners said they did not own a home was affordability. Over half of all non-owners reported this, with 20% saying they need the flexibility of renting.

Student Debt

Contrary to popular belief, student debt has not prevented homeownership, but it does seem to be delaying it. Of the 39% of non-owners with student debt, 59% reported that they wouldn’t be comfortable taking on a mortgage.  

“In addition to having to postpone important milestones such as getting married and starting a family, many young adults are financially falling behind previous generations in part because of having to prioritize repaying their sizeable student loans over buying a home and saving for retirement.”

- Yun

Down Payments 

Another factor blocking homeownership is actually a misconception. 87% of non-owners believe that a down payment of 10% or more is required to buy a home. But many banks have announced new 3% down programs for conventional loans. Depending on your credit history,  you may even be able to get a mortgage that requires zero down.

The median down payment for first-time buyers is only 6% (and has been for three years). 

So in conclusion, buying a home isn’t as far out of reach as you think. When you’re ready to get started, review your finances sit down with a lender to see what kind of mortgage you can qualify for and find a reliable realtor to start your search.