housing trends report quarter 3, 2020eyeonhousing.org/.../2020/10/housing-trends-report-q320.pdf ·...
TRANSCRIPT
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HOUSING TRENDS REPORT
QUARTER 3, 2020 (Data Collected: September 14-27)
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HOUSING TRENDS REPORT
The Housing Trends Report (HTR) measures
prospective home buyers’ perceptions about the
availability and affordability of homes for-sale in their
markets.
All data are derived from national polls of
representative samples of American adults
conducted for NAHB by Morning Consult. This report
is released quarterly to track changes in buyers’
perceptions over time.
Generation definitions:
o Gen Z*: Born 1997 to 2002.
o Millennial: Born 1981 to 1996.
o Gen X: Born 1965 to 1980.
o Boomer: Born 1946 to 1964.
Methodology:
The interviews were conducted online and the data were weighted to
approximate a target sample of adults based on age, educational
attainment, gender, race, and region. In qtr1’19, weights were
refined to better match the general US population and provide more
consistent distributions across demographic groups over time. These
new weights were applied retroactively to the entire series in order to
maintain comparability. In qtr3’19, Gen Z was incorporated into the
generational analysis for the first time.
* In 2020, Generation Z is constrained to end in the year 2002 because only adults 18 or older
can participate in the poll.
Results are not yet seasonally adjusted due to the short-time horizon of the series; therefore, only year-over-year comparisons are
statistically valid.
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PLANNING TO BUY A HOME WITHIN 12 MONTHS
13% of respondents in Qtr3’20 are prospective home buyers
(they have plans to buy a home within 12 months), 1 percentage
point higher than a year earlier. This is the first year-over-year
gain in the 3-year history of this series.
BY GENERATION: Millennials are the generation most likely to
want to buy a home (22%), even slightly higher than a year
earlier (20%).
BY REGION: The share of respondents planning to buy a home in
the Northeast rose to 16% in Qtr3’20, up from 11% a year
earlier. In the West, the share rose from 12% to 16%.
24%
17%14% 13% 13% 13% 12% 12% 11% 10% 11%
13%
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11%20%
12%6%
14%22%
14%6%
Gen Z Millennials Gen X Boomers
Q319 Q320
11% 11% 13% 12%16%
10% 12%16%
Northeast Midwest South West
Q319 Q320
The rest of this report is based entirely on prospective home buyers, i.e. those
planning to buy a home within the next 12 months.
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1ST-TIME HOME BUYERS
The share of prospective buyers who are first-timers is declining:
from 61% in Qtr3’18, to 60% in Qtr3’19, to the latest 55% in
Qtr3’20.
BY GENERATION: 81% of Gen Z’s planning to buy a home are
first-timers, compared to 64% of Millennials, 45% of Gen X’ers,
and 24% of Boomers.
BY REGION: About half (49%) of prospective buyers in the
Northeast are purchasing a home for the first time. The share is
highest in the Midwest, where it reaches 59%.
72%
54%63% 61%
53%60% 58% 60%
63% 61% 59% 55%
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81%64%
45%
24%
Gen Z Millennials Gen X Boomers
49%59% 57% 53%
Northeast Midwest South West
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NEW OR EXISTING HOME?
The share of buyers looking to purchase a newly-built home rose
to 31% in Qtr3’20, up from 18% a year earlier. The share
indifferent between a new or existing home, on the other hand,
declined from 41% to 32%.
By GENERATION: At least 30% of every generation would prefer
a new home, with the exception of Boomers (only 16%).
Instead, 49% of this oldest cohort prefer an existing home.
BY REGION: In the Northeast and West regions, more buyers
would prefer new homes over existing ones. The opposite is true
in the South and especially in the Midwest, where 53% prefer
existing homes.
41% 41%
18%
37%32% 31%
Existing home Either New orExisting
New home
Q319 Q320
30% 33%35%
16%
40% 36% 32%
49%
Gen Z Millennials Gen X Boomers
New Existing
39%
16%29%
35%33%
53%
38%32%
Northeast Midwest South West
New Existing
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AVAILABILITY EXPECTATIONS
In Qtr3’20, 28% of prospective home buyers expect that finding
the right home will get easier in the months ahead, compared to
21% a year earlier. Strong home sales in the summer of 2020
may have contributed to buyers’ improving perceptions.
BY GENERATION: Between the third quarters of 2019 and 2020,
expectations that housing availability will ease up improved most
significantly among Gen X buyers (21% to 32%) and Millennials
(22% to 30%).
BY REGION: Between the third quarters of 2019 and 2020,
expectations that housing availability will ease up improved
significantly in the West (16% to 28%) and the Northeast (24%
to 35%).
34%
16% 21% 19% 19%22% 20% 21% 23%
25% 25%28%
59%
73%68% 71%
72%67% 67% 68% 65% 62% 63% 61%
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Easier Harder / About the same
20% 22% 21% 17%21%
30% 32%
19%
Gen Z Millennials Gen X Boomers
Q319 Q320
24%18%
23%16%
35%
23% 24%28%
Northeast Midwest South West
Q319 Q320
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CHANGES IN INVENTORY
35% of buyers report seeing more homes for-sale* in Qtr3’20
than a quarter earlier (i.e. the peak of the COVID crisis). This
finding reflects increased levels of new home production and
listings of existing homes between the spring and summer of
2020.
BY GENERATION: The two generations most likely to report
seeing more homes for-sale in Qtr3’20 than three months earlier
are Gen X (39%) and Millennial (37%) buyers.
BY REGION: Buyers in the Northeast are the most likely to report
seeing more homes for-sale (37%), followed by those in the
South (36%) and West (35%).
* Homes with buyer’s desired features and price point.
38%
26%29% 30% 27% 30% 27% 29% 27%31%
29%35%
53%63% 61% 60%
64%60% 59% 59%
62% 55% 57% 56%
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More homes Fewer or about the same homes
32% 37% 39% 27%
Gen Z Millennials Gen X Boomers
37%
32%
36% 35%
Northeast Midwest South West
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AFFORDABILITY EXPECTATIONS
27% of buyers in Qtr3’20 say they can afford half or more of
the homes available in their markets, compared to 20% a year
earlier. The increase is an indication that lower mortgage rates
have had a stronger impact on buyers’ perceptions of
affordability than rising home prices.
BY GENERATION: Between the third quarters of 2019 and 2020,
the share of buyers who can afford half or more of the homes
available rose most significantly among Millennials (17% to
31%), but dropped among Boomers (23% to 19%).
BY REGION: Between the third quarters of 2019 and 2020, the
share of buyers who can afford half or more of the homes
available rose most significantly in the Northeast (21% to 39%),
but dropped in the Midwest (23% to 19%).
75%82%76% 79% 76% 78%
80% 80% 79% 78% 77% 72%
25%18%
24% 21% 23% 22% 20% 20% 21% 23% 24%27%
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Can afford < 50% of homes for-sale
Can afford >= 50% of the homes for-sale
19% 17%24% 23%26%
31% 29%
19%
Gen Z Millennials Gen X Boomers
Q319 Q320
21% 23% 19% 17%
39%
19%24% 28%
Northeast Midwest South West
Q319 Q320
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BEYOND JUST PLANNING
50% of adults with plans to purchase a home have moved
beyond planning and are actively trying to find one to buy,
compared to 44% a year earlier. This suggests the COVID-19
crisis and its accompanying low mortgage rates continue to lead
some passive buyers to engage and begin the purchase process.
BY GENERATION: Between the third quarters of 2019 and 2020,
larger shares of Millennials (45% to 58%) and Gen X’ers (42%
to 52%) planning to buy a home have become engaged and are
actively searching for a home. In contrast, fewer prospective
Gen Z and Boomer buyers report having started the process.
BY REGION: Between the third quarters of 2019 and 2020, larger
shares of prospective buyers in every region are actively trying
to find a home to buy.
46% 50% 47%54%
46%41% 44% 43%
49% 49% 50%
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43% 45% 42% 44%35%58% 52%
33%
Gen Z Millennials Gen X Boomers
Q319 Q320
50%
40%43% 45%
56%
42%48% 52%
Northeast Midwest South West
Q319 Q320
Remaining set of findings are based solely on responses from buyers
who are already actively engaged in trying to find a home (i.e. active buyers)
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TIME SPENT SEARCHING FOR A HOME
The length of time spent searching for a home continues to grow.
In Qtr3’20, 62% of buyers actively engaged in the purchase
process have spent 3 months or longer looking, compared to
58% a year earlier.
BY GENERATION: 62% of Millennial and 57% of Boomer active
buyers have been trying to find a home for at least 3 months,
compared to 56% and 51%, respectively, a year earlier.
BY REGION: 64% of active buyers in the West and 65% in the
South have been trying to find a home for at least three months,
compared to 53% and 56%, respectively, a year earlier.
50%46% 45%
42%46% 45%
42% 40%44%
41%38%
50% 54% 55%58%
53% 55%58% 60%
56%59% 62%
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< 3 months 3 months or more
71%56% 61% 51%
66% 62% 64% 57%
Gen Z Millennials Gen X Boomers
Q319 Q320
65% 58% 56% 53%61% 54%65% 64%
Northeast Midwest South West
Q319 Q320
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TOP REASONS BUYERS ACTIVE FOR 3+ MONTHS
HAVE NOT BEEN SUCCESSFUL
Although the top reason long-time searchers haven’t pulled the
trigger continues to be the inability to find an affordable home
(38%), that share is lower than a year ago (45%). On the other
hand, the share who blame getting outbid by other offers almost
doubled in the last year, from 15% to 27%.
BY GENERATION: Losing out to higher offers is the reason 31% of
Gen X’ers and 29% of Millennials searching for 3+months haven’t
been successful, up from 16% and 15%, respectively, a year earlier.
BY REGION: Between the third quarters of 2019 and 2020, larger
shares of active home buyers (looking for 3+months) in every region
have failed to buy a home because their offers are getting outbid.
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Can't find a home at a price I can afford
Can't find home with features I want
Can't find a home in the neigborhood I want
Get outbid when I make offer
38%
45%
27%15%
25%15% 16% 9%11%
29% 31%17%
Gen Z Millennials Gen X Boomers
Q319 Q320
12% 12%17% 18%
30%
18%25% 29%
Northeast Midwest South West
Q319 Q320
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NEXT STEPS IF STILL UNABLE TO FIND HOME IN
MONTHS AHEAD
When asked what they’ll do next if still unable to find a home in
the next few months, 26% say they’ll buy a more expensive home,
up significantly from 9% a year earlier. The share who will expand
their search area is also higher, up from 35% to 43%. The one
thing they are less likely to do than a year ago: continue looking
in the same location (down from 52% to 47%).
Difficulties finding a home to buy will likely lead 20% of active
buyers to give up until next year or later. That share is up
from 15% a year earlier.
20%
21%
26%
43%
47%
15%
16%
9%
35%
52%
Give up trying to find a home until
next year or later
Accept a smaller/older home than
originally intended
Buy a more expensive home than
origianlly intended
Expand my search area
Continue looking until the ‘right’
home opens up in a preferred location
Q319
Q320
13% 16%18% 16% 14% 16% 15% 16% 16%
19% 20%
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POLL DESIGN
The Housing Trends Report is based on quarterly polls conducted
for NAHB by the research firm Morning Consult.
Polls are based on a national sample of adults selected to
proportionately represent the US adult population in terms of
age, gender, region, race/ethnicity, and education. Further
weights are applied to the final set of respondents to ensure
proper representation across these demographic variables.
Table below shows sample size and dates of data collection.
Sample
size Collection
Period
Qtr4’17 2,800 November 16-19, 2017
Qtr1’18 11,674 March 28 – April 1, 2018
Qtr2’18 15,412 June 26 – July 8, 2018
Qtr3’18 20,051 September 25 – October 8, 2018
Qtr4’18 16,891 December 17 – January 9, 2019
Qtr1’19 15,401 March 18 – March 29, 2019
Qtr2’19 17,521 June 17 – June 27, 2019
Qtr3’19 17,601 September 9 – 22, 2019
Qtr4’19 19,804 December 17 – 24, 2019
Qtr1’20 21,652 March 17 – 28, 2020
Qtr2’20 19,800 June 16 – 28, 2020
Qtr3’20 17,601 September 14 -27, 2020