According to the National Association of Home Builders’ fourth quarter Housing Trends Report (HTR), 2018 saw little change in how homebuyers perceived their ability to afford homes available in their markets. In Q4 of 2018, three out of every four buyers (76 percent) estimate they can afford fewer than half the homes-for-sale in their markets. That number is slightly lower than the 79 percent of buyers who shared that perception in Q4 of 2017. On the other hand, 23 percent feel they could buy the majority of homes-for-sale in their markets, just barely ahead of the 21 percent who had that view in the final quarter of 2017. In reality, affordability is an issue for all age groups: 75 percent to 78 percent of buyers in each generation can afford fewer than half the homes available in their markets.
According to the report, millennials lead the pack as the generation planning to purchase a home within 12 months (22 percent), while seniors are the most unlikely (4 percent). It’s a seller’s market with a crunch in inventory affecting buyers of all generations. More than 60 percent of each group report fewer/same number of homes for-sale than three months earlier. Nearly 60 percent of each generation’s active buyers have been looking for three-plus months for the right home to buy.
Buyers seem undeterred, 63 percent indicate that if they are still unable to find a home in the next few months, they will continue looking for the ‘right’ home in the same preferred location. Another 44 percent will expand their search area. In the final quarter of 2018, only 16 percent said they will give up trying to find a home to buy until next year or later. Across generations, few buyers expect the search to get easier, 72 percent reporting their search will get harder or stay about the same: millennials (21 percent), gen X (21 percent), and boomers (15 percent).
For more insight and to view the full report please visit: Housing Trends Report (HTR)