LendingTree is out with a new study that shows pessimism is growing among future homeowners. While 94% say home ownership is the American dream, more than half fear they will never achieve it.
The survey asked 2,000 U.S. consumers about their homeownership dreams, fears, and challenges — and this is what LendingTree found:
- An overwhelming 94% of consumers say owning a home is part of the American dream — even if only 84% say it’s part of their dream.
- 51% of respondents who don’t own a home say they’re worried they never will. Among those who want to own one day, 49% say they can’t afford a down payment and 40% say home prices are too high in their area. Student loan debt weighs heaviest on millennials, with 19% citing it as a roadblock to homeownership.
- Of the 84% who’d rather own a home than rent, nearly 3 in 5 (59%) say they like the flexibility to do whatever they want with the space — 58% say they value not having to worry about renewing a lease.
LendingTree's Senior Economist, Jacob Channel, had this to say, "There’s no getting around how tough buying a home can be in today’s high-interest rates and high-price housing market. As tough as it may seem, those who want to buy but can’t afford to right now should try to keep hope. The more time you give yourself to do things like save for a down payment and work on your credit score, the more likely you’ll be able to buy one day.”
Flexibility is the top reason for wanting a home. Homeownership isn’t just something to check off the list of life milestones — there are good reasons for wanting to own, LendingTree said. Of the 84% who’d rather own a home than rent, 59% say they like the flexibility to do whatever they want with the space, making it the top reason. That’s especially true of baby boomers (64%), those earning between $50,000 and $74,999 (64%) and those with adult children (62%).
What’s holding would-be homeowners back? Among those who would own a home if they could, 49% say they can’t afford a down payment — making it the top reason. However, Channel notes that those concerns may be unfounded. “Though many people think they need to save up 20% of a home’s value for a down payment, that generally isn’t the case,” he says. “If you’ve got a high credit score and earn a decent wage, you may be able to get away with a down payment closer to 10% or even lower on a conventional mortgage.”
