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	Quick Links HOMES FOR SALE FIRST TIME HOME BUYING 15 SECOND APPRAISAL Our Listings RELOCATION HOME BUYING TIPS HOME SELLING TIPS   MOVIE LISTINGS  AREA NEWS    Communities San Diego Downtown Lofts Carlsbad Carmel Valley Del Mar Chula Vista 4S Ranch Escondido point loma encinitas coronado Ramona santee Fairbanks Highlands Rancho Santa Fe Buying a Home aREA Homes Search Featured Listings New Homes Open Houses New Listing Alert Home buying process How to Interview a Realtor Real Estate Reports How to Hire an Inspector Real Estate Forms Selling a Home What is my Home worth? What will my Home sell for? How to Interview a Realtor Sell home myself? Tax Implications Setting the price Preparing the Home to Sell Loans Types of Lenders Types of loans The Loan Process 0 down Poor Credit Seller Assisted Acorn Loan Program FHA HUD VA/Cal Vet Cop next store Nurse next store Military Single Parent State sponsored	43% of first-time home buyers put no money down   As housing prices soared last year, an eye-popping 43% of first-time home buyers purchased their homes with no-money-down loans, according to a study released Tuesday by the National Association of Realtors. The trend is potentially ominous. The real estate market is cooling in some areas, and rates on adjustable-rate loans are creeping up. As a result, some no-money-down buyers could owe more than their homes are worth.   Who are entry-level buyers? Survey of home buyers reveals: Median age: 32 Median household income: $57,200 Median down payment: 2%* Purchased with no money down: 43% * on home costing $150,000 Source: National Association of Realtors, 2005 Profile of Home Buyers and Sellers The median first-time home buyer scraped together a down payment of only 2% on a $150,000 home in 2005, the NAR found. Already, home prices in many areas are declining, and the "For Sale" signs are hanging in front yards longer. There's now at least a 50% risk that prices will decline within two years in 11 major metro areas, including San Diego; Boston; Long Island, N.Y.; Los Angeles; and San Francisco, according to PMI Mortgage Insurance's latest U.S. Market Risk Index. "In a number of areas, particularly on the coasts, they have a high risk of price declines in the next two years," says Mark Milner, chief risk officer of PMI. Red-hot home building, acquisitions, remodeling and refinancing in recent years helped drive the economy and raise fears of a real estate bubble. Dean Baker of the Center for Economic and Policy Research says that if housing prices fall at least 10%, it could be even more damaging than the collapse of the high-tech stock bubble in 2000. "If we do get a spike in mortgage rates, and a modest decline (in the housing market) turns into a rout, there's almost no bottom to that," Baker says. "That's a crash scenario." Baker and other economists are concerned that many lenders have pushed a series of creative but potentially dangerous loans to help more Americans afford a home. The traditional 30-year loan with a fixed rate remains the most popular way of financing, according to the Mortgage Bankers Association. But about one-third of homeowners take out riskier loans, such as interest-only or flat-minimum-payment mortgages. "These non-traditional loans transfer risk to the borrower," Milner says. NAR President Thomas Stevens says he isn't worried that nearly half of first-time home buyers put no money down, but adds, "If the number was higher than that, I'd be concerned."
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