RICHMOND, Va., Dec. 5, 2017 /PRNewswire/ -- Genworth
Mortgage Insurance, an operating segment of Genworth Financial,
Inc. (NYSE: GNW), today released its First-Time Homebuyer Market
Report for the third quarter of 2017, which shows the highest level
of first-time homebuyer demand since the third quarter of 2000,
drawn from a data set of 21 million first-time homebuyers over a
24-year span:
3Q'17 Overview
- First-time homebuyers purchased 601,000 single-family homes
compared to 567,000 during 3Q'16 – an increase of six percent,
resulting in the highest quarterly purchase volume since
September 30, 2000.
- First-time homebuyers accounted for 40 percent of all
single-family homes sold and 56 percent of all purchase mortgages
financed.
- For the first time since 2011, repeat homebuyer demand
declined. This group bought five percent fewer homes during the
quarter (888,000) compared to 3Q'16.
- Low down payment mortgages financed 467,000 sales to first-time
homebuyers, which is the most loans in a quarter since the third
quarter of 1999.
- The private mortgage insurance industry insured 181,000 loans
to first-time homebuyers during 3Q'17, its highest level since the
second quarter of 2007 and a 19 percent increase from 3Q'16. It
represented the fastest-growing source of credit to first-time
homebuyers in the mortgage industry. This compares to 197,000 FHA
loans for the quarter, a six percent decrease from 3Q'16.
3Q'17 Analysis from Tian Liu,
Chief Economist, Genworth Mortgage
Insurance:
"First-time homebuyers bought the most
homes in a quarter since the third quarter of 2000, buoying the
broader housing market that had slowed during this period (-1%
growth compared to Q3 of 2016). The surge in first-time homebuyer
demand, and the decline in overall purchases, was driven by
supply-demand imbalances in today's housing market.
Supply shortages are making homes less affordable, reducing
incentives to existing homeowners who want to upgrade. This was a
leading cause of the five percent quarterly decline in repeat
buyers, which contributed to the one percent decline in overall
home sales. It shows that the housing market is not working for all
homebuyers.
While supply shortages continue to inflate home pricing,
first-time homebuyer demand continues to increase because of a
greater sense of urgency from rental and home price inflation, and
greater housing need due to family formation. First-time homebuyers
see more value in homeownership beyond a simple financial return on
their investment.
Increased supply of low down payment mortgage products has
facilitated first-time homebuyers' entry into the purchase market.
During the quarter, seventy-eight percent of first-time homebuyers
used a low-down payment product, an increase of five percent from a
year ago. The low-down payment mortgage market experienced its
highest level of demand from first-time homebuyers since the third
quarter of 1999.
Lastly, first-time homebuyer growth is shifting the mortgage
industry landscape in favor of the private sector. The private
mortgage insurance industry was again the fastest-growing source of
credit enhancement for first-time homebuyers within the mortgage
industry. In contrast, the FHA program is beginning to contract.
These trends suggest that the private mortgage insurance industry
will likely become the largest source of credit enhancement for the
first-time homebuyer market soon, taking over from the
FHA."
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 21 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, visit:
https://miblog.genworth.com/first-time-homebuyer-market-report-12-17
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.
View original
content:http://www.prnewswire.com/news-releases/genworth-report-first-time-homebuyer-demand-rose-to-the-highest-level-since-2000-300566231.html
SOURCE Genworth Financial, Inc.