NAR just released Aspiring Home Buyers Profile, which focuses on survey responses from non-homebuyers, both those who rent and those living with a family member. Of the non-owners, 45 percent were 34 years or under, 59 percent make an income of under $50,000, and 43 percent live in suburban areas.  Across the quarters of 2018 non-homeowners were consistent in their desire to own a home in the future, with about three-quarters saying it was part of their American Dream. Nine out of ten homeowners gave that same response.

However, over the course of the year, non-owners’ perception of whether it was currently a good time to buy that home decreased from 51 percent in the first quarter to 47 percent in the fourth.  Over the same period homeowner perceptions dropped only 1 point to 72 percent.  There was little variation among non-owners by age groups, income, or city size. The single exception was in the West where the perception it was a good time to buy was lower than in all other regions.

 

 

Non-homeowners said their chief reason why they do not own a home is their inability to afford a mortgage.  The second biggest reason was that current life circumstances mitigate against it, while a smaller number said they need the flexibility of renting.

 

 

When asked what might provide the trigger for buying a home in the future, 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 a home in the future. In each quarter, 26 to 30 percent of non-owners said a change in lifestyle – such as getting married, starting a family or retiring – would be the primary reason they would make a future home purchase.

 

 

Both homeowners and non-owners were 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.  Eleven percent of homeowners and 14 percent of non-owners said they had an adult, usually an adult child, move into with them.  Of those, 44 percent said that the individual intended to stay for over one year or permanently. Eighty-eight percent of those surveyed who had someone move into their home reported that their living situation remained acceptable and therefore did not warrant consideration of moving into a different home. Twelve percent said they did consider moving or ultimately did move due to their home situation changing.

Lawrence Yun, NAR chief economist, says unaffordable housing has caused a number of potential buyers to hold off on purchasing a new home. “The lack of affordable and moderately priced homes has forced non-homeowners to delay achieving that part of the American Dream. However, as the survey confirms, significant lifestyle changes like marriage or starting a family often spur non-owners to pursue home-ownership.”

“While home sales were slightly down in 2018, there is still a sizable pent-up housing demand. Economic growth, interest rates, and the supply of moderately priced-homes will dictate how well the real estate industry will do this year,” said Yun.”

NAR’s survey was conducted by random dial telephone surveys each month in 2018.  An average of 680 interviews were conducted each month.