According to NAHB’s latest Housing Trends Report, the share of adults who are considering purchasing a home in the next 12 months fell to 11% in the final quarter of 2019, down from 13% a year earlier. This decline marks the fifth consecutive year-over-year drop in the share of American adults planning to buy a home in the year ahead, a trend likely spurred by the low levels of housing inventory available in the market.
An important development in the fourth quarter of 2019, however, is that a significantly larger share of prospective home buyers are first-time buyers (63%) than the comparable figure a year earlier (53%). Future polls will determine if first-time buyers will continue to grow as a share of all those looking to buy a home.
Millennials are the most likely generation to be making plans to purchase a home within a year (19%), followed by Gen Z (13%) and Gen X (12%). In contrast, only 5% of Boomers reported plans to purchase a home. Geographically, 12% of respondents in the South and West are prospective home buyers, slightly ahead of the Northeast (10%) and Midwest (9%).
Prospective buyers in the youngest two generations are primarily first-time buyers: 88% of Gen Z buyers and 78% of Millennial buyers are reaching out to homeownership for the first time in their lives. The share is much smaller (although still a majority) among Gen X buyers (57%) and significantly less likely among Boomers (20%). More than 60% of prospective buyers in every region are buying a home for the first time.
In terms of the type of home these prospective home buyers are interested in, 40% are looking to buy an existing home and 19% a newly-built home. The remaining 41% would buy either a new or existing home.
* The Housing Trends Report is a research product created by the NAHB Economics team with the goal of measuring prospective home buyers’ perceptions about the availability and affordability of homes for-sale in their markets. The HTR is produced quarterly to track changes in buyers’ perceptions over time. All data are derived from national polls of representative samples of American adults conducted for NAHB by Morning Consult. Results are not seasonally adjusted due to the short-time horizon of the series, and therefore only year-over-year comparisons are statistically valid. A description of the poll’s methodology and sample characteristics can be found here. This is the first in a series of five posts highlighting results for the fourth quarter of 2019.