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Prospective Homebuyers Showing Little Faith in Housing Market

The National Association of Home Builders announced [1] that just 21% of prospective homebuyers expect the search to get easier in the coming months. 

While this is an increase from last year’s 19%, analysis shows that 19% expect housing availability to get harder—lower than last year’s 71% who shared that expectation. 

Baby boomers are the generation that is most likely to expect homebuying to get harder, with 74% responding. Sixty-seven percent of Gen Z homebuyers expect the search to get harder, 66% of millennials, and 64% of Gen X agreed. 

The west region of the U.S. had the highest share of prospective homebuyers who felt the homebuying process would get harder at 72%. Sixty-six percent of prospective homebuyers in both the northeast and the south believe homebuying will get harder, and 68% of midwest respondents agreed. 

During Q3 2019, 29% of buyers reported seeing more homes on the market compared to last year, which is a slight decline from 2018's 30%. Also, the number of buyers who saw fewer homes for sales decline slightly to 59% from 60% during Q3 2018. 

Gen Z homebuyers reported seeing more homes for sale at 41%. Baby boomers had the highest share of respondents who saw fewer homes for sale at 18%. 

Of the respondents, the west had the highest share of prospective buyers who saw more homes for sale at 36%. The northeast was close behind at 30%, followed by 27% in the south, and 23% in the midwest. 

Inventory has been on the housing market’s most significant themes during 2019. Zillow reported [2]that the number of available homes for sale in September fell as there were just 102,112 fewer homes for sale on the market than last year—a 6.4% year-over-year decline. 

The number of homes for sale in September was at it lowest level since 2013. Home values during this same timeframe rose 4.8% to $231,000.

"Housing appears to have renewed its place as a bright spot contributing to continued U.S. economic growth. The return of accelerating quarterly price growth, rising sales numbers and increasing homebuilder confidence and activity all point to closing out 2019 on a healthy note, despite greater volatility over the course of this year," said Zillow Director of Economic Research Skylar Olsen.