COVID-19 Has Impacted Home Purchasing Plans

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According to NAHB’s latest Housing Trends Report, the share of Americans who are considering the purchase of a home in the next 12 months was 13% in the third quarter of 2020, one percentage point higher than a year earlier and the first year-over-year gain in the 3-year history of this series. The gain shows the COVID-19 crisis has impacted Americans’ propensity to want to buy homes.

Meanwhile, the share of prospective buyers who would be buying a home for the first time is declining. In the third quarter of 2018, 61% of prospective buyers were first-timers; by the third quarter of 2020, the share was 55%.

Between the third quarters of 2019 and 2020, the share of Gen Z adults planning a home purchase rose three points to 14%. Millennials, however, are the generation most likely to be considering buying a home (22%). Across regions, the share of respondents with plans to buy a home rose to 16% in both the Northeast and West, up from 11% and 12%, respectively, a year earlier.

Eighty-one percent of Gen Z’s planning to buy a home are first-timers, compared to 64% of Millennials, 45% of Gen X’ers, and 24% of Boomers. About half (49%) of prospective buyers in the Northeast are purchasing a home for the first time. The share is highest in the Midwest, where it reaches 59%.

In terms of the type of home these prospective home buyers are looking for, the share interested in a newly-built home rose to 31% in the third quarter of 2020, up from 18% a year earlier. The share indifferent between a new or existing home, on the other hand, declined from 41% to 32%.

* 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 third quarter of 2020.



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