Editor’s Note: Inman News is pleased to introduce "House Keys," a new weekly column about homeownership by veteran real estate writer Marcie Geffner. "House Keys" offers a fresh look at today’s changing images and perceptions of homeownership through current news events and personal stories. For information about publishing this column on your Web site or in print, contact Elaine Baker: (510) 658-9252 ext. 128.
Can first-time homebuyers save the U.S. economy?
Plenty of politicians, pundits and prominent economists believe so. In fact, new homebuyers are so crucial to a recovery that the federal government has anted up an $8,000 tax credit for those who haven’t owned a home in the previous three years, and the state of California has added on a whopping $10,000 tax credit for residents who buy a brand-new home in the state this year.
Last year, first-time homebuyers accounted for about 40 percent of the homes sold in the U.S., according to the National Association of Realtors. Nearly one-quarter of those first-timers were single women, whose median income was $47,400. The rest were single men, couples, families of all sorts and seniors.
There’s no question that home buying stimulates the economy. Each home purchase generates thousands of dollars in income for Realtors, lenders, home inspectors, appraisers, closing agents, notaries, and a long list of other people who earn their living directly or indirectly from home sales. Most homebuyers also spend heavily on home improvements and furnishings from roofs to rugs after they buy their home. That puts more money in the pockets of contractors, manufacturers and store clerks as well.
What’s more, first-time buyers enable experienced homeowners to trade up to more costly residences and downsize to more modest homes that better fit their needs. Without first-timers, the second-timers, third-timers and umpteenth-timers are stuck, but when they do move, those home purchases generate even more income and spending.
But regardless of whether homebuyers can save the economy, they are truly a joy to behold. And that joy is all the more precious in these dark days when happiness seems sadly absent from so many hearths and hearts.
Do you remember the excitement you felt when you bought your first home or the home you now own? Do you remember the tingle you felt in your hand and down your spine when you got your first set of house keys? Do you remember the first time you pulled into your own driveway? The first time you cooked a holiday meal in your own kitchen? The first time you mailed a mortgage payment instead of a rent check? Did you pause to savor the moment? Did you jump for joy? …CONTINUED
Did you hug your Realtor when you bought your home? I did. And then, to everyone’s surprise and embarrassment, I also hugged her visiting-from-out-of-town relatives, who’d happened to be in her car when she dropped off my keys.
Buying a home takes a leap of faith even in the best of times. It takes a willingness to be bold. It takes great hopes and sincere optimism about the future. There is joy in that faith, that boldness, that hope and that optimism, and it is joy we so dearly need to stimulate our spirits.
The new homeowner intends to settle and stay. The new homeowner is committed to a new neighborhood and new schools. The new homeowner has hope that economic conditions will improve and that jobs will be more secure and plentiful. The new homeowner has the confidence to look beyond the dark clouds of foreclosures and perhaps even believe that one day homes will regain some of their lost luster and investment value.
To this year’s new homebuyers, we say, congratulations! You were scared. You were nervous. You were anxious. But you were bold. You had faith. You did it. You got your keys.
Marcie Geffner is a freelance real estate reporter and former managing editor of Inman News.
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