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How Many Prospective Buyers Are Out There?

The National Association of Homebuilders (NAHB) reports just 43% of Americans were actively looking to buy a home during Q4 2019—a stark decline from the prior years’ 54%. 

Just 11% of Americans considered buying a home during the quarter. 

“This finding suggests that mortgage interest rates steadily below 4.0% in recent months have not motivated more prospective buyers to get started trying to find a home to buy,’ the NAHB says. 

The share of buyers actively seeking a home fell from 46% in Q1 2019 to the reported rate of 43%. That share dipped as low as 41% during Q2 2019. 

Millennials are the generation seeking to buy homes the most, with 46% reportedly actively searching. They were followed by Gen X buyers (43%), Gen Z buyers (41%), and Baby Boomers (37%). 

The Northeast was home to the most active homeseekers at 49%. 

Those seeking a home are needing to clear off their calendar, as the report states 60% of engaged buyers spent at least three months searching—and increase from the 58% last year. 

This is the fourth consecutive annual gain in the share of buyers who have spent more than three months looking to buy a home. 

Another issue for prospective buyers is price, as the NAHB also says that 44% of home searchers can’t find a house they can afford. 

Of those surveyed who were having issues finding a home, 51% said they will keep looking for the “right” home in the same location, 39% will expand their search, 19% will accept a smaller or older home, and 16% might buy a more expensive home. 

The share of prospective buyers who will “give up” looking if they can’t find a home after at least three months of searching rose 1 percentage point to 16% in Q4 2019—the second-highest reading since Q3 2018. 

CoreLogic reported recently that home prices rose 4% annually in December 2019 and are expected to increase 5.2% over the next year. 

Price appreciation averaged 3.6% for 2019, which is a considerable drop from 2018’s average of 5.8%. CoreLogic projects average growth for 2020 to be 4.6%.

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
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