Searching for a property in the Oxford housing market may require some patience these days.
Oxford housing market can be pricey for some buyers
While mortgage rates are hovering near record lows, the Oxford housing market is in very tight supply. Consequently, many sellers have increased their home prices too high for some potential buyers, both first-time and move-up buyers. Despite low down payments, buyers are now using a much higher portion of their annual income to make the investment. This trend is especially prevalent in the case of the first-time buyer and Millennials and evokes the age old question to rent or buy.
In contrast, one of the long-time accepted “rules of thumb” is the 28/26 Rule. It states an owner(s) should spend a maximum of 28% gross monthly income on housing expenses and no more than 36% on all other debt. Play it safe and do not become house poor.
Restoring equity and lowering debt
Many buyers are still underwater on their mortgages. With the low mortgage rates, this may signal the golden opportunity for a refinance on your loan. Meanwhile, many Millennials have cited student loan debt as the catalyst for delayed home ownership.
“Saving for a down payment can be difficult for prospective first-time homebuyers given the absence of substantial wage growth in recent years combined with the burden of student loan debt many are struggling under,” said Daren Blomquist, senior vice president at RealtyTrac. “Even just a 3 percent down payment requires 14 percent of annual wages on average across the 513 counties we analyzed, and in 67 counties a 3 percent down payment requires more than one-fifth of annual wages.” See study.
More housing inventory needed
While down payment assistance can help, the real relief will only come as more homes are available for sale. These new homes will be provided by new construction, which is also in short supply.