Homebuying value survey falls to record low
A quarterly poll of homebuyer sentiment reveals that younger Americans are losing faith in the value of homeownership.
The Modern Homebuyer Survey from home down payment and refinance equity protection specialists ValueInsured reveals that 48% of millennials believe buying a home in America today is a good investment.
That’s a record low, down from 54% in the second quarter of 2018; the previous peak was two years ago (77%).
When presented with “buying a home is the best financial decision I can make for myself and my family” 58% agreed. However, that’s a sharp fall from the 67% who agreed in Q2 2018 and the 81% who agreed in Q3 2016.
The survey also found that 23% believe they must delay starting a family until they can buy a home, turning on its head the conventional wisdom that delaying homeownership was due to later family formation.
Young buyers are anxious
Among motivated first-time buyers, 49% worry that increasing mortgage rates could make homes currently within their budget become unaffordable later.
Two thirds are concerned they will not save enough for a home they would actually like to live in; 52% believe a home they buy now will likely drop in value within one year; and 68% are worried about a housing crisis.
"Most homebuyers experience a healthy amount of jitters before such a milestone purchase – that's normal," says Joe Melendez, CEO and founder of ValueInsured. "But the new normal is highly anxious, inexperienced buyers bungee jumping in without knowing if their safety harnesses will work. That is an unhealthy, bordering on dysfunctional trend that our industry needs to mitigate to ensure we do not lose an entire generation of future homeowners."
Just over six in 10 millennials (61 percent) now believe buying a home is more beneficial than renting, again a survey low, down from a high of 83% two years ago.
