Although housing prices are rising while the effects of COVID-19 are being felt in the market, Veterans are optimistic about homebuying in the 2021 housing market. According to the Veterans United Home Loans National Survey, approximately 1 in every 3 Veterans plans to buy a home this year. The pandemic forced nearly half of the Veterans surveyed to consider home buying, leaving many determined not to miss out in 2021. The National Survey suggests that 58% of Veterans, or 11.3 million consumers, plan to buy a home within the next 5 years.
COVID-19 Stopped Nearly Half of All Veterans from Buying a Home
The pandemic caused massive disruption in 2020, with 49% of Veterans that participated in the survey suggesting it affected their homebuying plans. Along with covid, low interest rates greatly affected the market. 43% of Veterans decided to purchase earlier than planned, while 21% of Veterans took advantage of favorable rates to refinance their homes. The remaining 32% of Veterans decided to put a pause on their homebuying plans for now.
Veterans Are Positive About Their Finances and Homeowning Prospects
60% of Veterans believe their finances will improve in 2021; however, only 55% of Veterans believe the economy will become stronger. While experts are still offering contrasting economic forecasts for the year ahead, 59% of Veterans feel that 2021 will be the year that they purchase their dream home.
Veterans Are Ready to Enter the Market
61% of Veterans believe the next 12 months will be a great time to purchase a home, with 34% of Veterans planning to buy. However, the next 5 years should see even more action, with 58% of Veterans planning to purchase a home.
Barriers to Homeownership
Despite Veterans’ positivity regarding their financial future, many recognize that there are still barriers in the way of their homeownership dreams. Unsurprisingly, 46% of Veterans suggested that the uncertainty of COVID-19 could be a potential barrier to homeownership. Another concerning barrier is the possibility of interest rates increasing, with 58% of Veterans believing they will rise.
Last year’s home price increase was driven by low inventory across the country, leading 51% of Veterans to believe that homes would increase in price, becoming less affordable over the coming 12 months.
VA Loans and Assistant Programs
For Veterans, one misconception of home buying surrounds the down payment and financing. Almost 90% of Veterans believe they need a FICO credit score of around 670 to be approved for a home loan. An additional 41% of Veterans reported that, in their understanding, they need 20% of the home’s price for a down payment.
Although most Veterans have access to the $0 down VA home loan, only 3% of Veterans are aware that it is possible to buy a home with no down payment. With many Veterans ready to buy a home, more Veterans may be willing to enter the market if they are aware of the $0 down payment home loan available to Veterans.
Related: VA Mortgages
COVID-19 Is Not Fully Over
Rather than being driven away from the housing market during the pandemic, many Veterans took action and purchased a home, likely due to favorable mortgage rates offered.
60% of Veterans stated that COVID-19 economic impacts would get worse before they get better. 55% of Veterans surveyed commented that Covid would continue to impact them, while two-thirds of Veterans believe the economy will never return to how things were before COVID.
Marimark Realty is a full-service real estate company in Tampa, Florida. Our focus is on providing a personalized experience for both buyers and sellers of residential and commercial properties, as well as investors.
To begin the journey of purchasing or selling your home, or purchasing commercial or investment properties, contact us at your earliest convenience.