First-Time Homebuyers are Leaving the Market

This was just released by the Tennessee Association of Realtors:

First-Time Homebuyers In Retreat

*** BEGIN QUOTE ***
First-time home buyers are retreating from the housing market, accounting for only 39% of home purchases in July, down from 48% in March, according to the latest Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market Conditions, released this week.

The percentage of first-time buyers last month was at the lowest level in at least a year. "The end of the tax credit has clearly had an effect," said Thomas Popik, research director for Campbell Surveys, in a news release. "First-time home-buyer participation is continuing to drop. We expect a further decline in first-time home-buyer activity, perhaps reaching as low as 30% to 35% of the market by the fall months."

...First-time home buyers are crucial to the health of the housing market because they soak up excess inventory; repeat buyers don't have the same effect because they're selling a home at the same time they're buying another.

Having fewer first-timers buying a home will likely put downward pressure on home prices in the late summer and fall, according to the Campbell/Inside Mortgage Finance survey. *** END QUOTE ***

To read the entire article, click here: http://www.marketwatch.com/story/first-time-home-buyers-retreat-from-housing-market-2010-08-27