Survey: Renters Want to Buy – Many Just Can’t Afford It
The lack of affordable and moderately priced homes has forced non-homeowners to delay achieving that part of the American Dream
WASHINGTON – January 15, 2019 – Homeowners and non-homeowners both strongly consider homeownership part of the American Dream, according to new consumer survey data from the National Association of Realtors®(NAR).
Among those polled, approximately 75 percent of non-homeowners believe homeownership is part of their American Dream; of current homeowners, 9 in 10 said the same.
NAR's Aspiring Home Buyers Profile analyzed 2018 quarterly consumer insights from its Housing Opportunities and Market Experience (HOME) survey to capture the housing expectations and sentiments of non-homeowners – both renters and those living with a family member.
Non-homeowners were asked for the chief reason they don't currently own a home, and most said it was because they can't afford a mortgage.
However, that number has dropped quarter-to-quarter. In the last quarter of 2018, 43 percent of non-owners said they don't own a home because they're not in a position to purchase; in the third quarter of 2018, 49 percent of non-owners said it.
Other reasons cited in the latest 4Q survey: 33 percent of non-homeowners said they don't own because current life circumstances aren't suitable for ownership; 16 percent said they need the flexibility of renting.
The survey also looked at the main reason non-homeowners would buy a home in the future. Throughout 2018, 28 to 31 percent of non-owners each quarter said an improvement in their financial situation would be the top reason that would encourage them to buy. In each quarter, 26 to 30 percent of non-owners said a change in lifestyle – getting married, starting a family, retiring, etc. – would be the primary reason.
"The lack of affordable and moderately priced homes has forced non-homeowners to delay achieving that part of the American Dream," says Lawrence Yun, NAR chief economist. "However, as the survey confirms, significant lifestyle changes like marriage or starting a family often spur non-owners to pursue homeownership."
For this year's survey, homeowners and non-owners were also asked about adult family or friends moving into their homes, the span of time this individual(s) lived within the household, and if they thought about moving to a new home because of the change.
According to the survey, 11 percent of homeowners had an adult child move into their residence, while 5 percent of non-owners had an adult move into their home.
Of those who had someone move into their home, 44 percent said that the individual intended to live with them for over one year or to stay permanently. Forty-four percent of non-owners reported that the individual planned on living with them for between six months to one year.
Of those who had someone move into their home, 88 percent reported that their living situation remained acceptable and therefore did not warrant consideration of moving into a different home; 12 percent said they did consider moving or ultimately did move due to their home situation changing.
"While home sales were slightly down in 2018, there is still a sizable pent-up housing demand," said Yun. "Economic growth, interest rates and the supply of moderately priced-homes will dictate how well the real estate industry will do this year."
© 2019 Florida Realtors®. All rights reserved. Reprinted with permission.
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