RICHMOND, Va., May 21, 2019 /PRNewswire/ -- Genworth
Mortgage Insurance, an operating segment of Genworth Financial,
Inc. (NYSE: GNW), today released the First-Time Homebuyer Market
Report from its Chief Economist, Tian
Liu, for the first 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
- Single-family home purchases decreased:
-
- 1Q'19: 401,000 single-family homes were purchased – a
three percent decline from 1Q'18
- Larger Share: First-time homebuyers accounted for 38
percent of single-family homes sold and 57 percent of purchase
mortgages originated
- Diverging Trends Across States: The slowdown spread to
38 states compared to 31 states in 4Q'18; 14 states reported more
first-time homebuyer activity compared to 21 states a year ago
- Improved housing affordability: The past three years saw
a trend towards declining affordability. That trend reversed in Q1
as declining mortgage rates coupled with slowing home price growth
in Q1 improved affordability.
-
- The average interest rates for first-time homebuyers in Q1
decreased by 15 basis points to 4.89%, lagging the 41-basis point
decrease in the Freddie Mac 30-year conventional mortgage rate
- Low down payments still preferred:
-
- 321,000 (80 percent) of homebuyers used some form of low down
payment mortgages to finance their first home purchase, a three
percent decrease compared to a year ago
- PMI: Conventional mortgages, enabled by the private
mortgage insurance industry, helped 133,000 first-time homebuyers
in Q1 – more than any other product. It was the only segment in the
mortgage market to report any year-over-year growth.
- Slowdown contributing factors: Next to affordability
challenges, the recent government shutdown disrupted lending
programs such as USDA's Single-Family Housing Loan Guarantee
Program, which reported 6,000 fewer first-time homebuyers in Q1
compared to a year ago, a 30 percent decline
"First-time homebuyers continue to represent a large part of the
activity in the housing market despite the slowdown in the overall
market," said Tian Liu, Chief
Economist, Genworth Mortgage Insurance. Q1 was a period of
transition. The first-time homebuyer market experienced further
slowdowns due to worsening affordability from the past three years.
However, affordability began to improve, and further decreases in
interest rates in Q1 suggest that affordability will have more room
to improve, significantly reducing the cause of the original
slowdown. Low down payment mortgage products remain critical in
financing their first home purchase, and private mortgage insurance
is now the undisputed leader in this market."
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 Financial
Genworth Financial, Inc.
(NYSE: GNW) is a Fortune 500 insurance holding company committed to
helping families achieve the dream of homeownership and address the
financial challenges of aging through its leadership positions in
mortgage insurance and long term care insurance. Headquartered
in Richmond, Virginia, Genworth
traces its roots back to 1871 and became a public company in
2004. For more information, visit genworth.com.
From time to time, Genworth releases important information via
postings on its corporate website. Accordingly, investors and other
interested parties are encouraged to enroll to receive automatic
email alerts and Really Simple Syndication (RSS) feeds regarding
new postings. Enrollment information is found under the "Investors"
section of genworth.com. From time to time, Genworth's
publicly traded subsidiaries, Genworth MI Canada Inc. and Genworth
Mortgage Insurance Australia Limited, separately release financial
and other information about their operations. This information can
be found at http://genworth.ca and
http://www.genworth.com.au.
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 Financial, Inc.