A new survey shows that consumers saving for a home are willing to forego modern conveniences in order to secure a down payment. That may even mean giving up phones, Internet, cable TV, or Starbucks, according to a newly released survey by the business advisory firm the Collingwood Group.
Potential first-time home buyers are making such sacrifices because they want to be able to make a sizable down payment on their home purchase. Nearly two-thirds recently surveyed by TD Bank say they’d like to put 20 percent down or more on their home purchase. The bank polled more than 1,000 consumers who were not home owners but intended to purchase a home within the next five years.
First-time home buyers are increasing their ranks lately, with their share in the housing market rising to 32 percent in May. That matches their highest share since September 2012, according to the National Association of REALTORS®. A year ago, first-time buyers represented 27 percent of all buyers.
The survey showed that around 62 of potential first-time buyers are making plans to purchase a home within the next two years.
“It’s encouraging to see interest from the first-time home buyers, who have been cautious for much of the housing recovery,” says Scott Haymore, head of pricing and secondary markets at TD Bank. “Consumers are gaining confidence in the economy and many are looking to enter the housing market within the next two years.”
Some additional survey findings include:
- More than two-thirds of consumers – 68 percent – who say they’re looking to purchase their first home say they want a move-in ready home, while one-third said they’d buy a fixer-upper.
- Forty-three percent of consumers say they’re looking to buy their first home in a suburban area outside of a city compared to 20 percent who say they desire a home in a big city or metro area.
- Respondents ranked the most desired amenities in their first home as a backyard or pool, an attractive design, and energy efficient/smart home technologies.
- The largest barriers preventing respondents from purchasing their first home was the need to save for a down payment and pay down debt. Also, more than one in five consumers – 22 percent – who are looking to purchase their first home said they couldn’t find a home in their price range.