The preference could be contributing to the ongoing inventory shortage in most markets, says Zillow
A majority of American homeowners would rather spend money to upgrade their homes instead of paying for a down payment on a new home, according to the Housing Aspirations Report released by Zillow.
The report found that 76% of Americans would rather use a set amount of money so their home will meet their needs. Across the country, people are largely happy with their current homes.
The sentiment is especially true for older or retired Americans. Zillow found that 87% of people who are 55 years or older and 91% of retirees would rather renovate.
Eight-three percent of homeowners say they love their home, according to the 2018 Zillow Group Report on Consumer Housing Trends. Additionally, 63% of homeowners don't have any plans to sell their homes.
Zillow said that this preference could be contributing to the ongoing inventory shortage most markets are facing.
Another factor that may be affecting the decision to move or renovate a home is rising mortgage rates, according to the company. Homeowners who have a low mortgage rate may not want to lose that affordability advantage by buying a new house with a higher rate.
"Even in a seller's market, simultaneously buying and selling is an exercise in frustration. Add to that the emotional history between you and your home, and it's no wonder low inventory has been in a self-fulfilling cycle," said Skylar Olsen, director of economic research and outreach at Zillow. "Homeowners may hesitate to sell because of limited options for them as buyers, but by holding on to their homes, they are themselves contributing to low inventory."