Category Archives: homeownership

Is homeownership on the rebound?

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For the second quarter of 2017, homeownership saw an increase year-to-year, rising from 62.9 percent to 63.7 percent.

According to the U.S. Census Bureau’s Residential Vacancies and Homeownership report for the second quarter of 2017, homeownership also rose .1 percent quarter-to-quarter, increasing from 63.6 percent to 63.7 percent. Homeownership was the highest in Midwest, at 68 percent, followed by the South at 65.5 percent, the Northwest at 60.4 percent and the West at 58.9 percent. The Northeast saw an increase in homeownership in both quarter-to-quarter and year-to-year.

What generation is leading homeownership? Not surprisingly, those 65 and older for this past quarter, with 78.2 percent being homeowners, compared to only 35.3 percent of those under 35, though the millennials did increase 1.2 percent year-to-year. As residents age, so does their likelihood of homeownership, 58.8 percent of those aged 35 to 44 own a home, while 69.3 percent of those aged 45 to 54 are homeowners, and 75.4 of those 55 to 64 years old own their home.

Across demographics, non-Hispanic whites had the highest rate of homeownership at 72.2 percent, followed by Asian, Native Hawaiian and Pacific Islander household owners at 56.5 percent, and black homeownership hit 42.3 percent.

Around 87.1 percent of homes in the U.S. were occupied, leaving 12.9 percent empty.

Meanwhile, the number of rental vacancies rose from 6.7 percent to 7.3 percent year-to-year, yet the median rent continued to increase. The median asking rent for vacancies was $910, a new peak. Rental vacancies in the Northeast was the lowest in the country, at just 5.2 percent, compared to 9 percent in the South, the highest.

More and more Americans are feeling positive about the housing market, according to Fannie Mae. This latest report from the U.S. Census Bureau shows that they are starting to do something about it.

Homeownership? It’s for the dogs

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Who knew adding a dog to the mix would lead more millennials to homeownership?

According to a recent survey from SunTrust Mortgage, one-third of millennials in the U.S. said they purchased their first home to have better space or more yard for a dog. Pups led to homeownership for millennials more so than marriage or a baby. Forty-two percent of millennials who have yet to purchase a home said their dog, or their desire to have one, will be a reason they buy a home.

“Millennials have strong bonds with their dogs, so it makes sense that their furry family members are driving home-buying decisions,” said Dorinda Smith, SunTrust Mortgage president and CEO. “For those with dogs, renting can be more expensive and a hassle; homeownership takes some of the stress off by providing a better living situation.”

In addition to Fido, the largest percentage of millennials (66 percent) want more living space, which led them to purchase their first home, while 36 percent cited a desire to build equity. One-quarter of millennials said marriage was the key factor that led to purchasing their first home, while 19 percent said the birth of a child made them take the leap.

“Millennials are trending toward homeownership,” Smith added. “Demand among millennial-aged, first-time homebuyers is robust, and we expect them to continue adding strength to the housing market.”

Earlier, this year, NAR found that 61 percent of households either own a pet, or are planning to get one, while nearly one-third of pet owners have not put an offer on the house because it was less than ideal for their animal.

Homebuying, mortgage process stressful for many consumers

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Forty-two percent of homebuyers reported that the homebuying process was stressful, according to NerdWallet’s Home Buyer Reality Report.

Nearly one-third said it was complicated, while 21 percent reported it was intimidating. However, 30 percent described the experience as rewarding, while 41 percent it was manageable. Yet, 49 percent reported they would do something differently if they were homebuying again.

Mortgage applications are still confusing many homebuyers, as 58 percent of homebuyers applied for one. Forty-one percent of homebuyers who did apply said they were not sure of all the options available to them. And 28 percent said they did not feel like a priority to their mortgage professional during the loan process. Overall, 89 percent of applicants were approved for a loan to buy their house.

Among generations, 27 percent of millennials believed their mortgage rate was affordable when they purchased, and 39 percent said the mortgage process was positive. Eighty-nine percent of millennials who applied were approved. However, 11 percent of millennials said that after purchasing their home, they didn’t feel financially secure anymore. More than half (57 percent) said they had regrets in their homebuying experience.

Only a quarter of Generation X members reported a positive experience with the mortgage process, but 91 percent of Gen Xers were approved for one. Twelve percent reported not feeling financially secure after homebuying. Sixty-one percent reported that they would do something differently when homebuying again.

As for baby boomers, 25 percent found the mortgage process stressful, but 42 percent said it was manageable. Sixty-five percent said they believed they were aware of all their options for mortgages during the process. Only 6 percent said they did not feel financially secure after they bought their house, but 38 percent of baby boomers would act differently when homebuying again.

Compared to previous generations, millennials are less apt to move

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In 2016, only one in five millennials had moved in the past 12 months.

This is a decrease from 2000, when 26 percent of young adults had moved in the previous year, as well as 1963, when, yet again, 26 percent of young adults reported moving the year before, according to a recent report from the Pew Center.

The Pew Center analyzed why millennials aren’t as apt to move. Most likely, it’s due to lack of funds, thanks to lower-paying jobs. In fact, most millennials who did move in 2016 did so for a job, the Pew Center reported. Student loan debt is also a huge part of millennials’ inability to get a mortgage, and purchase a home.

For those millennials that did move last year, 22 percent moved into a home they purchased. Comparatively, in 1981, 35 percent of young adults the same age moved into a home they had purchased.

There are also three main factors that separate millennials from previous generations. One of the top reasons is that less millennials are married at this age than previous generations. Today, 42 percent of millennials aged 25 to 35 live with their spouse. In 1963, 82 percent of those aged 25 to 35 lived with a spouse.

Millennials are also less likely than previous generations to own a home, only 37 percent live in an owner-occupied that isn’t their parents’, compared to 56 percent of baby boomers at the same age. Finally, millennials are less likely to have children at this age.

Despite not owning a home, thus making it easier to move, and not having children, many millennials are hesitant to move, thanks to lack of funds, high student debt and their inability to get a mortgage.

 

 

 

Fido does impact where pet owners live and how they renovate

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Ninety-nine percent of those with a pet believe the animal is a part of their family, according to NAR’s 2017 Animal House: Remodeling Impact report.

And they are looking out for the whole family’s best interest when they search for a home. Sixty-one percent of households either own a pet, or are planning to get one. Twelve percent of pet owners have moved for their animal, and 19 percent said they would consider moving to better accommodate their pet. Nearly one-third of pet owners have not put an offer on the house because it was less than ideal for their animal.

And of those that own a pet, 61 percent said it’s difficult to find a rental property or homeowner association that allows animals. Ninety-five percent reported that they think living in a housing community that allows pets is important. Sixty-two percent said it is important to have animal-friendly amenities, like a walking path, animal store or animal grooming, near their residence.

On the other hand, more than two-thirds of Realtors® surveyed reported that owning a pet has an effect when listing a home. They suggested owners should replace anything that has been damaged, clean the home to remove any scents and take the pet out during showings as the top three ways to avoid negative feedback from potential buyers.

Homeowners are also remodeling to accommodate their pets. More than half (52 percent) of pet owners completed a home project to better serve their pets’ needs. Twenty-three percent added a fence to their yard, 12 percent added a dog door and 10 percent added laminate flooring. Ninety-four percent reported they felt “satisfied” with their remodeling. Of those who remodeling, 44 percent paid a professional, while 56 percent completed the project themselves. Realtors® also reported that more than 90 percent of homebuyers with a pet want a fenced yard.

Nearly 90 percent of households would not give up their pet for a residence.

“In 2016, 61 percent of U.S. households either have a pet or plan to get one in the future, so it is important to understand the unique needs and wants of animal owners when it comes to homeownership ” says NAR President William E. Brown. “Realtors® understand that when someone buys a home, they are buying it with the needs of their whole family in mind; ask pet owners, and they will enthusiastically agree that their animals are part of their family.”

Survey: 25 percent of Americans interested in buying this year

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Twenty-five percent of adults reported that they are very likely or somewhat likely to purchase a home this year, according to a recent survey by Bankrate.

Of all non-homeowners surveyed, 15 percent reported they are somewhat or very likely to purchase a home in 2017.

Specially, older millennials (aged 27-36) and Generation Xers (aged 37-52) are more likely to buy within the year. Nearly 40 percent of minorities, more than double the percentage of white adults, reported they are likely to buy a home this year.

“Among millennials, there’s a lot of pent-up demand for home buying,” said Holden Lewis, Bankrate.com’s senior mortgage analyst. “They have been stymied by stagnant wages, student loans and a lack of available starter homes. If enough affordable homes are put on the market, we might see a surge of first-time homebuyers in their early to mid-30s.”

Mortgages do cause hesitation in some would-be homebuyers. Thirty-seven percent of possible homebuyers reported that the size of the mortgage has a major impact on their savings for the future, while 46 percent reported it has a minor impact on their savings.

Parents also struggle more to save, according to the report. Two-thirds of non-homeowners with young children said they are unable to purchase a home due to lack of good credit or the inability to save for a down payment. Eighteen percent reported they don’t want to own a home.

“Having kids and raising a family is a primary reason why Americans take the leap into homeownership—many consider it a key component of the American dream,” added Lewis. “They’re caught between the costs of raising children and paying those mortgages and saving money.”

Realtor.com® Chief Economist Jonathan Smoke said that while most people believe they need 20 percent for a down payment, “in reality, it averaged 11 percent last year.”