Eye On Housing
Buyers’ perceptions about the availability of homes in the market are showing significant improvement, according to the latest Housing Trends Report. In the final quarter of 2020, 37% of prospective buyers expect their search for a home to get easier in the months ahead, while 54% expect it will be harder or stay the same. A year earlier, far fewer (23%) expected availability improvements and more (65%) thought it would turn more difficult to find a home to buy. The solid improvement in buyers’ perceptions on availability reflects the fact that more new and existing homes were sold in 2020 than in any other year since 2006.
Across generations, expectations that housing availability will improve in the months ahead rose significantly among Gen X buyers (23% in qtr4’19 to 43% in qtr4’20) and Millennials (24% to 40%), but only slightly among Boomers (18% to 22%). Gen Z buyers did not experience an improvement in availability expectations during this period.
Geographically, expectations that housing availability will ease up jumped up most significantly in the Northeast (22% to 46%) and the West (21% to 40%), while rising more modestly in the South (24% to 32%) and Midwest (23% to 25%).
In terms of the actual number of homes buyers are seeing for-sale (that they like and can afford), 41% reported seeing more available in the final quarter of 2020 than the previous quarter, up from 27% in the final quarter of 2019. The improvement in buyers’ perceptions on inventory also reflects the fact that new home production in 2020 reached its highest level since 2007.
Across generations, the share of buyers seeing more homes for-sale jumped significantly among Gen X (28% to 46%) and Millennial (30% to 47%) buyers, rose more modestly among Boomers (21% to 27%), but fell slightly among Gen Z buyers (30% to 27%) between the final quarters of 2019 and 2020.
Across regions, the share of buyers seeing more homes for-sale more than doubled in the Northeast (22% to 53%), rose significantly in the West (24% to 42%), and increased more modestly in the South (29% to 37%). Buyers in the Midwest, on the other hand, are slightly less likely to report more homes for sale during this period (33% to 31%).
* 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 third in a series of six posts highlighting results for the fourth quarter of 2020. See previous posts on plans to buy and new vs. existing preference.
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