According to a new report from real estate database RealtyTrac, the Federal Housing Administration (FHA) has succeeded in its goals of drawing more young, low-income and first-time homebuyers into the market with lower insurance premiums. The report shows that with the help of more affordable financing options, millennials may finally be starting to buy homes as the country emerges from the shadow of the 2008 housing crisis.
RealtyTrac's Midyear 2015 Home Sales Report found that FHA loans were used in 23 percent of all homes bought with mortgages in the second quarter of 2015. During the same period in 2014, only 19 percent of financed purchases were made with FHA loans.
This increase can be credited to the FHA's decision to lower its premiums earlier this year, decreasing borrowers' payments by an average of $900 per year. For low-income homebuyers, this represents a significant savings.