Survey Reveals Buyer Optimism, Concerns, and Motivating Factors

Thirty percent of potential homebuyers plan to purchase a home in the next 18 months, according to “Insights: From the Mind of the Homebuyer,” a survey released by Chase Mortgage Banking this morning.

The survey, which included phone interviews with more than 1,000 Americans between the ages of 25 and 65, also revealed some key information on homebuyer concerns, motivating factors and more.

According to the survey, three of every 10 potential homebuyers intend to purchase a home in the next 18 months, and 62 percent think now is a better time to purchase than last year. Nearly a quarter of those planning to purchase a home intend to do so in upcoming spring or summer, while 35 percent plan on waiting a year or longer to buy.

As for their motivations for buying, 32 percent attribute it to current low mortgage rates. Another 35 percent said if 30-year fixed mortgage rates were to rise above 4 percent, it would delay their purchase.

Rising rent costs also played a role, with 20 percent of buyers saying buying a home was a better value than paying a monthly rent. An additional 20 percent said upgrading from their current home was their motivation for buying.

The survey also revealed insights into homebuyers’ concerns and challenges. Seventy percent of those surveyed said they thought they may have missed their opportunity to buy already, as home prices are increasing. Another 56 percent were concerned with finding properties within their price range.

Additionally, 75 percent said they were worried about being outbid, and three out of five said they may need to make compromises, like buying a smaller home, looking in a different neighborhood, etc., in order to make up for rising home prices.

“Buyers are clearly concerned about housing inventory and rising prices, especially during the competitive spring buying season,” said Cecelia Barbieri, SVP of marketing for Chase Mortgage Banking. “But the research shows that interested buyers are optimistic and ready to act on their goals. In fact, 73 percent said they’d give up things like eating out and taking vacations in order to buy their dream home.”

Chase’s research also revealed that homebuyers are anxious about the buying process. Seventy percent said they were more worried about the mortgage process than they would be about getting a root canal or public speaking. One-third of couples surveyed said the homebuying process has led to bickering.

“It’s understandable why first-time homebuyers are anxious about the process, but preparation is the best defense,” Barbieri said. “We want to make the homebuying process as easy and stress-free as possible—that’s why we offer informative resources, including YouTube videos, a mortgage calculator, a step-by-step buying guide and a webinar on our website.”

And it appears that these educational materials are much-needed. The survey also revealed that only 25 percent of homebuyers actually understand APRs, mortgage rates, down payments and other crucial parts of the purchasing process. More than 70 percent of those surveyed believed their interest rate would determine their total mortgage.

Editor’s Note: Keep an eye out for a featured article by Cecelia Barbieri, SVP and Head of Mortgage Originations Marketing at Chase Mortgage Banking, in the July 2015 issue of the MReport. In her article, Barbieri will delve into “Insights: From the Mind of the Homebuyer,” further, as well as, discuss how its findings can be used in your marketing strategies.