Over half of mortgage industry executives, or 57%, anticipate first-time home buyer growth in 2018, estimating that market will grow at a faster pace than the overall housing market, according to a Genworth Financial survey conducted at this year's Mortgage Bankers Association's Annual Convention in Denver.
About 31% of respondents project the first-time buyer market will grow at the same pace of the overall housing market, while only 12% expect the population's growth to slow.
Industry professionals were reportedly divided on their expectations for the most likely source for credit expansion next year. Among the most cited sources were LTV loans above 80% and 700 FICO scores below 700. Some respondents also claimed debt-to-income ratios above 41% will most likely be utilized for credit expansion in 2017.
Nearly half of mortgage executives expect a strong lender appetite for non-qualified mortgage loan originations next year, suggesting the housing market is on a strong upward trajectory, according to Genworth.
Respondents cite a lack of down payment and affordable housing inventory among the biggest hurdles for first-time home buyers, but lenders can combat these impediments through consumer outreach.
"Despite their emergence as today's fastest-growing home buying demographic, first-time home buyers still face many headwinds. While some of these, such as shortages in affordable inventory, are environment-driven, others can be addressed via improved awareness on the various low-down-payment solutions available in today's market," said Rohit Gupta, president and CEO of Genworth Mortgage Insurance, in a press release.
"Ensuring that the right tools from both a product and educational standpoint are in place is imperative to supporting the continued positive trajectory for these buyers," said Gupta.