WASHINGTON – July 13, 2016 – Despite lackluster economic growth and stark home-price appreciation in several parts of the country in recent months, roughly three-quarters of surveyed households still believe it’s a good time to buy a home – but there’s a considerable morale gap between homeowners and renters, according to the latest installment of the National Association of Realtors® (NAR) Housing Opportunities and Market Experience (HOME) survey.
The survey also found that roughly half of young adults with student debt are uncomfortable about taking on a mortgage.
In NAR’s second quarter HOME consumer survey, respondents were asked about their confidence in the U.S. economy and various questions about their housing expectations, including whether student debt is tempering their ability and appetite to take on mortgage debt.
NAR’s survey found that the share of homeowners and renters who believe it’s a good time to buy a home has held steady so far this year, with 80 percent of homeowners (82 percent in March) and 62 percent of renters (unchanged from last quarter) saying it’s a good time to buy. However, the share of renters who think so is down from 68 percent in December 2015, and those under 35 were the least confident.
Lawrence Yun, NAR chief economist, says the survey brings to focus the ongoing disparity in buyer confidence between current homeowners and renters.
“Existing-home prices surpassed their all-time peak this spring and have climbed on average over 5 percent nationally through the first five months of the year, and even faster in areas with severe supply shortages,” he says. “Most homeowners appear to realize that if they’re ready to sell, they’ll likely find a buyer rather quickly and be able to use the sizeable equity they’ve accumulated in recent years towards their next home purchase. Meanwhile, renters interested in buying continue to face minimal choices, strong competition and home prices growing faster than their incomes.
“Given these affordability pressures, it’s no surprise respondents earning over $100,000 and those living in the Midwest – the most affordable region of the country – are the most optimistic about buying right now,” says Yun.
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