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Survey Reveals Persistent Desire For Homeownership

Feb 21, 2024
Happy Homeowners
News Director

Despite rising rates and soaring prices, majority of survey respondents express readiness to pursue homeownership if mortgage rates fall below critical thresholds.

Americans still aspire to own a home despite challenges posed by escalating mortgage rates, according to a recent survey from Realtor.com. The survey highlights a prevailing belief in the enduring American dream of owning property, contingent upon mortgage rates aligning favorably with economic circumstances.

As mortgage rates climb above 7%, the demand for home purchases waned last week, reflecting the mounting difficulty in affordable homeownership. Concurrently, soaring home prices, propelled by a scarcity of available properties, exacerbate the affordability crunch for potential buyers nationwide.

"The current market is very different from where it was before the pandemic, but many Americans still have a positive outlook towards achieving the dream of buying a home," Realtor.com Chief Economist Danielle Hale said. "This optimistic lens may shape the way younger shoppers in particular view mortgage rates. Although mortgage rates are up from a year ago, they have declined more than a percentage point from their recent peak." 

The resolve to achieve homeownership remains unwavering, as indicated by findings from Realtor.com's recent survey. The data reveals that a significant portion of respondents express readiness to pursue homeownership if mortgage rates dip below crucial thresholds.

For instance, if rates descend below 7%, a threshold surpassed in 2023, 18% of respondents express intentions to buy a home within the next year. An additional 22% of shoppers say they can buy if the rate drops below 6%; 32% would enter the market if rates drop below 5%; another 18% are looking for mortgage rates below 4% and the last 9% of survey respondents aren't sure what rate would make it possible for them. 

Although rates are not anticipated to go below 6.5%, according to Realtor.com's 2024 Housing Forecast, research shows that every half-percent drop in the mortgage rate reduces the monthly payment for the typical home for sale by $120, a savings of $1,400 per year and $43,000 over the life of a 30-year mortgage.

Younger demographics exhibit greater flexibility regarding their homebuying timeline, with a sizable proportion of millennials and Gen Z respondents indicating willingness to proceed with a purchase even if rates surpass 8%. Notably, a majority of millennials and Gen Z respondents perceive the present as an opportune moment to embark on the homeownership journey, contrasting with comparatively lower sentiments among Gen X and Boomer counterparts.

Moreover, millennials emerge as the most optimistic cohort regarding their near-term homeownership prospects, underscoring their enduring faith in the feasibility of achieving this quintessential American dream. 

About the author
Christine Stuart is the news director at NMP.
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