Study Shows Homeownership is a Priority for Younger Consumers

From Florida Realtors and Real Estate Weekly News:

Copyright © 2017 NewsRx LLC, by reporter-staff news editors at Real Estate Weekly News

NEW YORK – Oct. 6, 2017 – Homeownership remains a priority for younger consumers despite tight housing inventory and stiff competition for homes – the conditions driving up prices in many markets.

In Berkshire Hathaway HomeServices’ latest Homeowner Sentiment Survey, 71 percent of prospective homeowners – a demographic composed largely of millennials – believe now is a good time to buy a home, and 63 percent remain steadfast in their ideal preferences for a home.

Consumers are also gaining a deeper understanding of market conditions: 72 percent of prospective homebuyers say home buying has become increasingly competitive with a shortage of listings; 76 percent of prospective millennial buyers expressed concern of overpaying for a home; and 76 percent said finding a competitively priced home is a challenge.

Several factors have contributed to the current housing shortage in many markets. For starters, new construction ground to a halt during the Great Recession while population growth and household formation continue to blossom. Builders are increasing their new construction projects in a wider range of price points, but demand still outstrips supply in markets such as Miami, Philadelphia, Chicago, Los Angeles and San Francisco.

The vast baby boomer generation has contributed to the shortage as many are reluctant to sell. In the survey, 73 percent of boomers said they hesitate to list their homes because home values are rising. Another factor reflects convenience. Four out of five boomers said they would rather not shop for a new property at the moment.

“The world seems to be waiting on millennials to make a move in all facets of their lives,” says Gino Blefari, president and CEO of Berkshire Hathaway HomeServices. “Our data suggests younger generations remain very positive about homeownership and remain in the game in markets where competition for good, reasonably priced homes can be tough.”

Blefari says rising home prices likely will move more boomers off the fence as they retire, downsize and move to other markets.

“Home values have mostly recovered from the downturn and homeowners may have more equity than they’re aware,” he says. “Equity gives people latitude to make important changes in their lives.”

  • 45 percent of prospective homeowners say they’re willing to cover closing costs
  • 36 percent of millennial buyers will send a personal letter to sellers
  • 58 percent of millennials would plunk down a higher deposit to show their commitment to sellers
  • 31 percent of millennials would offer above asking price to secure their home
  • 72 percent of current homeowners have a favorable feeling about the real estate market, with 51 percent pointing to low mortgage rates and 44 percent citing price appreciation for their optimism.
  • 61 percent of prospective buyers and 63 percent of current homeowners expressing confidence in their knowledge of current mortgage rate levels, jumps of 2 and 4 percentage points, respectively, from the spring Homeowner Sentiment Survey

“Historically low mortgage rates continue making homeownership achievable for many Americans,” says Blefari. “We believe mortgage rates will remain within a range of current low levels for the foreseeable future.”

Copyright © 2017 NewsRx LLC, by reporter-staff news editors at Real Estate Weekly News

About The Author

Related Posts

Leave a Reply