PALM BEACH GARDENS, Fla. — First-time home buyers continue to face barriers trying to buy a home in this real estate market, and experts say it isn't slowing down.
A new report released Friday by Redfin sheds light on what it now takes to actually buy a home in South Florida.
"I've looked at probably 10 properties, and it's just frustrating because as soon as you get there and you find something you like, it evaporates before you can even do anything with it," first-time home buyer Weston Albury said.
He said he's having trouble competing to buy a home in the Jupiter-Palm Beach Gardens-North Palm Beach area.
Albury said he's up against cash buyers and investors.
"With the interest rates being what they are, financing is just so expensive," he said. "The last rate I got quoted was 7.5%, whereas if you look at what it was two or three years ago, your monthly payment is just so much higher."
He's a relatively new resident of the Sunshine State.
"I'm originally from the Bahamas, and I moved over here after Hurricane Dorian, so I have been renting since then," Albury said. "I'm looking for a place to call my own."
Soaring home prices and higher interest rates mean you might need more income to buy a home.
According to a new Redfin report, cash buyers make up about 40% of starter-home buyers.
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"The amount of pressure that is being put on the market with buyers is tremendous," Mike Ivancevic, a managing broker for Illustrated Properties said. "Affordability is tough."
Currently, there are about 40 to 45 homes for sale in the Alton community located in Palm Beach Gardens.
Ivancevic said he expects the community to be full by the year's end.
It's another example of the inventory problems in South Florida that are adding to the barriers to buying a home.
"I don't know that there is any change in sight," Ivancevic said. "Our demand is so high that I don't see a change coming."
According to Redfin, first-time home buyers need to earn 13% more than a year ago to afford a typical "starter" home.
That equates to about $64,500 per year — an increase of about $7,200.
In South Florida, those numbers are even higher.
"The other challenge that we are having is that the houses that are affordable, is the insurance," Ivancevic. "The age of the roof, condition, even getting to the closing table is tough."
The Redfin report said first-time home buyers in Miami need 25% more income. In Fort Lauderdale, buyers need to earn $58,300 to buy a $220,000 home.
That's what they call the price of a typical starter home there.
In West Palm Beach, buyers need an income of $64,933 to afford a $245,000 home and the monthly payments that come with it.
"It is hard to get a house under $400,000 in northern Palm Beach County, if not almost impossible," Ivancevic said. "When you start doing the search on the MLS and you start putting the parameters in there, you really narrow it down to a dozen homes, maybe, if you are lucky."
Luck, timing and patience are key for home buyers.
"It might take a year, might take six months," Ivancevic said.
"I just have to save more money and be ready with a bigger down payment," Albury said.