First-time buyers are facing plenty of challenges – but high rates shouldn't dissuade them from purchasing, says LO
Ongoing housing affordability issues are especially hard on first-time homebuyers but despite these challenges, one loan officer believes potential buyers who rent instead are making other people’s dreams come true at the expense of their own.
Christina McCollum (pictured top), producing market leader at Churchill Mortgage, has been a loan officer for over 20 years. She notes that the sustained high rates, caused in part by the ongoing tariff issue, are keeping first-time homebuyers out of the market.
“I think affordability is one of the biggest issues,” McCollum told Mortgage Professional America. “And what really carves out affordability is the rates. Rates typically in the fours and fives create a lot of affordability. And when we live in the sixes and sevens for long periods of time, that can really hurt a person who’s purchasing a house for the first time.
“My brother, for example, still thinks renting is more affordable than buying, which is crazy to me.”
She encourages potential first-time buyers to consider buying their first house rather than renting in the long term, despite the higher interest rates.
“I would give a buyer the same advice I would give my adult children,” McCollum said. “Even if you never become an investor in real estate, investing in the home you live in is a better option than paying 100% interest on rent.”
McCollum tells potential homebuyers that putting off buying their first home and deciding to continue renting is putting off generating future wealth at the expense of making it for someone else.
“You have to be forward-thinking,” McCollum said. “You have to think about the future and what that looks like, knowing this is an investment in your future. At least buy the house you’re going to live in. Don’t rent from someone else, because people become landlords so they can become wealthy.
“They’ve already bought their first house and are now buying investment properties. You’re just helping them with their dream when you should be helping yourself with yours.”
Additional affordability challenges in Eastern Washington
McCollum works in Eastern Washington state. In her region and similar areas across the country, a surge of new home construction is also affecting affordability for first-time homebuyers.
“In our area, 45% is new construction,” McCollum said. “The average price per house here was $280,000 in 2010. Our average price now is way closer to $480,000. Just 15 years later, just to get your foot in the door, you’re looking at just under half a million.”
She notes that their part of the state attracts many transplants from California, who see home prices in the region as bargains compared to the Golden State.
“But if you grew up here, it’s hard,” McCollum said. “Affordability is hard. You will compromise what you’re willing to live with for a rental just to not have to pay the price point.
Movement Mortgage’s Kevin O’Laughlin urges buyers to look beyond rate headlines. With a segmented team built for speed, he helps clients make smart, data-driven moves—before price jumps erase potential savings. https://t.co/8q4Ph9Si09
— Mortgage Professional America Magazine (@MPAMagazineUS) May 5, 2025
While new home prices are surging as materials costs increase due to increased tariffs, especially from China, this doesn’t mean builders are making a lot of money.
“There is not a lot of margin in new construction, like people probably assume,” McCollum said. “We just had a client close last week on a new build. It was 1,200 square feet for $408,000. So the price per square foot continues going up.”
Brokers and loan officers need to be advisors
McCollum is teaching a new loan officer program at Churchill Mortgage. Her advice to her students and other brokers and loan officers is to prioritize service over sales.
“If you do the right thing and enough people see it, you can build an entire business around it,” McCollum said. “We are salespeople, so we can be very emotional about our jobs. And we handle transactions during the most stressful time of most people’s lives. But good things can happen, like when I help my son buy his first house.
“You’ve got to live in the good as much as you allow yourself to be a part of the negatives.”
She encourages brokers to keep first-time buyers looking at the big picture and understanding that their investment will pay off in the future.
“It’s kind of like a tree,” McCollum said. “It’s like the statement that says the best time to plant a tree is 20 years ago. If you don’t get in at some point, you might struggle to get in later, because the house I bought in 2010 was 3,500 square feet, five-car garage, for $289,000. That house would go for $750,000 today.
“The prices of houses will never be less expensive. So, you’ve got to pick a point when the pain is worth it, in a way.”
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