Owning a home has always been a big part of the American Dream. Children of hard-working parents grew up believing that if they worked hard to get ahead, they could have a better life than the previous generation, and that included having their own home.
However, recent statistics show that this dream has been starting to crash. According to a new study from Pew Research Center which analyzed Census Bureau housing data, more United States households “are headed by renters than at any point since at least 1965.”
Americans are not renting because they don’t want to own their own home, although there are some who prefer the flexibility renting brings. Most often, it’s because they can’t afford to own a home. Mortgage rates are still low, but so are home inventories, and prices have gone up while standards for qualification for mortgages remain high. And many Americans, particularly millennials entering the housing market, are burdened with debt and unable to save for a down payment.
What Statistics Show
Another separate Pew report showed that 72% of renters want to buy houses eventually, but about two-thirds of them rent as a result of circumstances. A majority of renters cited financial reasons for not owning a home.
Young adults in particular have difficulty. A survey by ApartmentList.com shows that saving for a down payment is the biggest obstacle. Sixty-eight percent of millennials have less than $1,000 saved for a down payment; 44 percent have no down payment savings at all, and 40 percent don’t even plan to start saving. Those who are saving need to do so for a long time — more than five years to accumulate enough for a 20 percent down payment, says the survey, and 20 years in the hottest housing market areas.
As for Ohio, the U.S. Census Bureau statistics show that in 2016 the home ownership rate was 66.1%, compared to a high in 2005 of 73.1%. Nationally, the homeownership rate in the second quarter of 2016 was 63.7%, up 0.8 percentage points from last year’s 62.9%, which was the lowest rate for homeownership since 1965. Since then, the homeownership rate has remained close to this 50-year low.
Surprisingly, millennials were the only generation to see an increase in their homeownership rate in the second quarter — from 34.3% to 35.3%. For other generations, the homeownership rate decreased as follows:
35 to 44 years old: Decreased 0.2 percentage points to 58.8%
45 to 54 years: Decreased 0.1 percentage point to 69.3%
55 to 64 years: Decreased 0.2 percentage points to 75.4%
65 years and older: Decreased 0.4 percentage points to 78.2%
What Can Help
Ohio has some homeownership programs that can help low- and moderate-income residents purchase their first homes through the Ohio Housing Finance Agency (OHFA). The OHFA offers competitive interest rates and mortgage options on 30-year, fixed-rate mortgage loans, fixed-rate FHA, VA, USDA-RD and conventional mortgage loans.
The OHFA “Your Choice! Down Payment Assistance” program allows homebuyers to choose either 2.5% or 5% of the home’s purchase price to be applied toward down payment, closing costs or other pre-closing expenses. The assistance is forgiven after seven years, but must be repaid if you sell or refinance your home within seven years.
You may qualify if:
You have not owned or had an ownership interest in your primary residence in the last three years
You meet income and purchase price limits
You meet the credit-score requirements.
The minimum credit scores for borrowers using OHFA Homebuyer Programs are:Conventional, USDA, VA = 640
FHA = 660
To find an OHFA-approved lender in your area, call 888.362.6432
Contact Us For Help
If saving for a home and other financial issues have become so overwhelming that you find yourself drowning in debt, you may want to consider the fresh start available by filing for bankruptcy. Bankruptcy is a legal way to have many debts forgiven. The most common types are Chapter 7 and Chapter 13. Chapter 7 is a full liquidation of all assets, while Chapter 13 may allow you to keep property while you complete a three- to five-year payment plan to have debts forgiven.
The experienced and compassionate Ohio debt relief attorneys at Fesenmyer Cousino Weinzimmer can provide a helping hand. We offer a free consultation to evaluate your entire financial situation. We will examine your income, your debts and your goals and discuss the best fit for you. We will make sure you are aware of all of your options and help you decide on the path to a brighter future that makes sense in your individual case. We understand what you are going through and will handle every phase of the process.
Delaying can only make your financial situation worse, so call the Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer today! Call one of our conveniently located office branches at 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati) or email for your free consultation so we can determine what debt relief solutions will work best for you.