Tight credit pushing first-timers away from home market

First-time home buyers fell to a 37 percent market share in the past year from a record high 50 percent a year ago, according to the 2011 National Association of Realtors Profile of Home Buyers and Sellers.

Paul Bishop, NAR vice president of research, said the impact of restrictive mortgage credit has taken its toll.

“The bar has been raised to qualify for a loan,” Bishop said. “Buying your first home has never been particularly easy, but with record-high housing affordability conditions and a pent-up demand, we normally would expect a stronger performance.

“This underscores how important it is to open the credit spigot for creditworthy buyers – banks simply need to get back into the business of lending. Higher home sales would help create jobs through related economic activity.”

The study shows the median age of first-time buyers was 31 and the median income was $62,400, up from $59,900 in the 2010 study. The typical first-time buyer purchased a 1,570 square foot home costing $155,000; the estimated median monthly mortgage principal and interest payment was $794.