The New York Fed does a survey on how you’re feeling about housing and consumer finance every year. Here’s what you need to know about the latest home buying, renting, selling and financing trends.
– The majority of renters still perceive obtaining a mortgage as difficult, but the share perceiving it as easy or very easy rose above 21% for the first time since at least 2014.
– Spoiler alert: it’s not hard to get a mortgage, and new tech keeps making it easier.
– But renters continue to think getting a mortgage (if they want to buy a home) is hard, with 57.9% stating that it would be “somewhat difficult” or “very difficult” to get a mortgage.
– Renters really wish they owned homes. 71.5% of renters report preferring or strongly preferring to own if they had the financial resources to do so.
– More renters now plan on buying a home—an increase of 52.4% from 49.5% in 2018 now plan on buying, with the increase strongest among older renters.
– Renters on average think their rent will go up 7.3% in the next year (!)
– These points show that as people age and mature in their careers, they start to tie owning a home into their ideas of self-worth and success.
– And let’s avoid cynical assumptions that aging workers won’t ever rise up and are fooling themselves about buying a home one day. A big part of this population are getting smarter, earning more, and will accomplish this life goal.
– 65% of all respondents think that buying property in their zip code is a “very good” or “somewhat good” investment, the same level as in 2018. Only 9.0% think housing is a “bad” investment, down from 10.6% a year ago.
-People are more worried their homes will lose value—an increase of 29% from 27% in 2018. Younger respondents—those under 50—perceive more downside risk compared to those over 50.
– 34.7% of homeowners think they’ll put at least $5k into home improvements this year, and 47.9% plan to invest $5k into their home within 3 years.
– Home ownership has fully bounced back from post-2008 lows at 64.2%
– Fewer people think they should refinance—that rate declined to 8.0% from 8.8% in 2018.
– This last point is of dubious merit. Consumers don’t really know how rates fluctuate everyday, but it’s worth noting that rates are in prime refi territory at this moment.
Don’t forget to explore the rent-to-own options that are gaining more popularity lately.