First-time homebuyers are finally jumping into the U.S. property market.
Need proof? Look at the mortgage market’s fastest-growing segment: loans with low down payments insured by the Federal Housing Administration.
Originations of FHA-backed mortgages, used predominately by first-time buyers, were up 54 percent in September from a year earlier, according to the most recent data from CoreLogic Inc. By December, the FHA insured 22 percent of all loan originations, up from 17 percent a year earlier, according to data compiled by Ellie Mae Inc.
“The FHA will be a contributing factor to homeownership rising again in America,” said David Lykken, president and founder of Transformational Mortgage Solutions in Austin, Texas. “We’re seeing the return of first-time buyers.”