High costs of homeownership and the increasing challenge of finding a home that’s affordable appears not to be dampening the spirit of potential homebuyers
High costs of homeownership and the increasing challenge of finding a home that’s affordable appears not to be dampening the spirit of potential homebuyers.
Americans still overwhelmingly believe that homeownership is a priority (75%) despite experiencing anxiety and financial strains to do so.
The ‘pulse’ of the nation’s potential homebuyers has been taken in a poll of more than 2000 Americans for Nerdwallet, conducted by The Harris Poll in March.
“If recessions, high prices and stress can’t kill the American dream, I’m not sure anything will,” said Tim Manni, NerdWallet’s mortgage expert. “The American desire to own a home is incredibly resilient.”
Americans with a mortgage spent 21.5% of their incomes on homeownership costs in 2016, the lowest rate since 2010, when they were spending 25%, according to U.S. Census Bureau data, but the Nerdwallet survey shows that 11% of respondents were late with at least one payment in the last 12 months.
The Pulse on Homeownership also reveals that the top reason for buying among recent and prospective homebuyers is its investment potential. But concerns about the cost of owning a home include the potential for unexpected repairs.
"Homeowners have mixed emotions. Owning a home makes them feel accomplishment and have a sense of pride, yet it also leaves them stressed,” said NerdWallet's home analyst, Holden Lewis. “With 75% of homeowners saying they have felt anxious about unexpected home repair costs, there's a mismatch with the number of homeowners (only 25%) who turn to home equity line of credit to help pay for those repairs. For most homeowners, having a HELOC is one way of paying for home repairs and unexpected costs because interest rates tend to be lower than those of credit cards."
