What does it take to buy a home?
The second annual edition of “How American Views Home Ownership” report by Wells Fargo & Company details results of a survey conducted found attitudes toward it are positive, but consumers have many misunderstandings about what it requires to become a homeowner.
The survey found that 65 percent of respondents view homeownership as a dream come true or as an accomplishment of which to be proud and 72 percent think that now is a good time to buy. They also see the financial benefits of homeownership, with 43% saying it’s a good way to build equity or more assets.
Only one out of ten renters said they would prefer to rent over owning.
The first misconception centers on credit scores. Two-thirds of respondents believe they need a “very good” credit score to qualify for a mortgage but 45 percent defined a “good” score as over 780 which is actually considered excellent by most scoring models while a score over 660 is considered good
Thirty-six percent of all respondents and over 50 percent of minority respondents assume a 20 percent down payment is always required even though there are programs that require downpayments as low as 3 percent..However, awareness of different types of mortgages decreased from last year.
So what does this mean to us investors?
Maybe you might consider having a little “seminar” for prospective homeowners with a lender there answering questions. That way you could build a buyer’s list. Put fliers in apartment buildings inviting them. The ones that are not qualified yet to buy would be lease option candidates
Just some food for thought.
