Of the 11% of American adults considering a future home purchase in the second quarter of 2020, about half (49%) are not simply planning it, they are actively engaged in the process to find a home. That is a significantly higher share than the comparable figure a year ago (41%), which suggests that the COVID-19 crisis and its accompanying record-low mortgage rates have converted some prospective buyers into active buyers.
Of Millennials planning a home purchase in the next year, 57% are already actively searching for a home. Among Boomers, that share is only 37%. Across regions, prospective buyers in the Northeast are the most likely to be actively engaged in the purchase process (57%), compared to 44% in the Midwest, 45% in the West, and 50% in the South.
The timing of the data collection for this report (June 16-28) is important, as results need to be interpreted in the larger context of the US economy and the trajectory of new case counts at the time. In June, the labor market showed signs of recovery, gaining 4.8 million jobs and a lower unemployment rate. The 30-year fixed mortgage rate continued to fall, reaching 3.13% by the last week of the month. The number of COVID cases nationally were stable through the first half of the month, only beginning their ascent around June 15. For these reasons, we assess that responses in this quarter’s report reflect a period when workers were returning to their jobs, mortgage rates looked increasingly attractive, and the pace of new cases had only recently started to regain speed.
Results from the latest Housing Trends Report also show that the length of time spent searching for a home is growing. In Qtr2’20, 59% of buyers actively engaged in the purchase process have spent 3 months or longer looking, compared to 55% a year earlier. This marks the sixth consecutive year-over-year gain in the share of active buyers looking for 3+ months for a home to buy.
* 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 fourth in a series of five posts highlighting results for the second quarter of 2020. See previous posts on plans to buy, housing availability, and housing affordability.