Tight inventory is slowing house sales in markets across America and while labor shortages, supply of lots and materials costs are prevalent, there is another reason for the lack of homes
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Tight inventory is slowing house sales in markets across America and while labor shortages, supply of lots and materials costs are prevalent, there is another reason for the lack of homes.
The realtor.com Housing Shortage Study reveals that many sellers are reluctant to list their homes simply because it meets their current needs.
The poll of more than 1,000 randomly selected homeowners found that a third of millennial owners are planning to sell in the next year, 59% say they are not and 6% aren’t sure.
The good news is that those millennials that are planning to sell are set to move to larger homes, freeing up starter homes which remain the tightest property type with a 17% drop in supply year-over-year. Medium-sized home inventory is down 10% and larger home supply is down 5%.
"The housing shortage forced many first time home buyers to consider smaller homes and condos as a way to literally get their foot in the door," said Danielle Hale, chief economist for realtor.com.® "Our survey data reveals that we may see more of these homes hitting the market in the next year, but whether these owners actually list will depend on whether they can find another home."
While a sizeable share of young homeowners plan to sell in the next year, older owners are not. The survey revealed that 85% of baby boomers are not planning a sale in the next year, which accounts for around 33 million of US homes.
"Boomers indeed hold the key to those homes the market desperately needs, both in the urban condo and the detached suburban home segment," said Hale. "But with a strong economy and rising home prices, there's really no reason for established homeowners to sell in the short term. Although down-sizing might be on the minds of boomers, they face the same inventory shortages and price increases plaguing millennials."
The top reasons for not selling across all demographics were: home meets their current needs (63%), low interest rates (16%), recently purchasing their home (15%) and needing to make home improvements or low property taxes (both polled 13%).
The realtor.com Housing Shortage Study reveals that many sellers are reluctant to list their homes simply because it meets their current needs.
The poll of more than 1,000 randomly selected homeowners found that a third of millennial owners are planning to sell in the next year, 59% say they are not and 6% aren’t sure.
The good news is that those millennials that are planning to sell are set to move to larger homes, freeing up starter homes which remain the tightest property type with a 17% drop in supply year-over-year. Medium-sized home inventory is down 10% and larger home supply is down 5%.
"The housing shortage forced many first time home buyers to consider smaller homes and condos as a way to literally get their foot in the door," said Danielle Hale, chief economist for realtor.com.® "Our survey data reveals that we may see more of these homes hitting the market in the next year, but whether these owners actually list will depend on whether they can find another home."
While a sizeable share of young homeowners plan to sell in the next year, older owners are not. The survey revealed that 85% of baby boomers are not planning a sale in the next year, which accounts for around 33 million of US homes.
"Boomers indeed hold the key to those homes the market desperately needs, both in the urban condo and the detached suburban home segment," said Hale. "But with a strong economy and rising home prices, there's really no reason for established homeowners to sell in the short term. Although down-sizing might be on the minds of boomers, they face the same inventory shortages and price increases plaguing millennials."
The top reasons for not selling across all demographics were: home meets their current needs (63%), low interest rates (16%), recently purchasing their home (15%) and needing to make home improvements or low property taxes (both polled 13%).
