Ok, so buyers are more scarce than they were before. Credit availability, rising unemployment and compensation are the primary concerns.
But those who will lead us out of this market are likely going to be the ones who were never in it – first time buyers because they have little baggage to carry with them.
- First time buyers don’t have to sell a property to afford to purchase
- First time buyers will likely use conventional financing (sub-$729k mortgages in Manhattan) and jumbo (non-conventional/non-jumbo conventional) was not addressed in the stimulus plans)
- First time buyers have no preconceived expectations about previous high water marks – see the current market as a deal.
- Sellers have been softened up since last summer suggesting more negotiability.
The New York Times has run two fairly strong pieces on this topic in recent weeks:
First time buyers are starting to be a factor in the current market, which is something we saw in the mid-90’s after a down market.
And of course, at the tail end of the 1990-91 recession…