Photo: Robert Clark
Not only have national home inventory levels decreased from last year, but the number of lowest priced homes for sale has also fallen, putting more pressure on US homebuyers.
According to the results of a new survey conducted by the National Association of Home Builders (NAHB), the majority homebuyers are taking, on average, three months or longer to find a home. Unsurprisingly, affordability is the primary reason for the extended shopping time.
Housing affordability erodes even more for single Americans than it does for their married or coupled counterparts, who reap the benefit of dual-income.
Some 61 percent of respondents said that they were actively shopping for a home to buy “three months or longer,” while 39 percent said they were shopping three months or less.
Affordability was cited by 42 percent of respondents as the reason their search is taking longer than three months, claiming that they are “unable to find a home in their price range.” And, not able to find a home with the features they want is causing 36 percent of respondents to keep looking.
Fierce competition resulting from severely low supply of starter and entry-level homes has 27 percent of respondents still actively looking for a home to buy. These respondents say they have been consistently outbid by other homebuyers when making an offer.
“This result shows there are several important reasons why prospective buyers haven’t been able to pull the trigger, but the most important one is lack of affordability – not being able to find a home at a price point they can afford,” writes NAHB in the digital release.
Meantime, affordability is proving to be especially challenging for singles, who can on average only afford about 45 percent of all the homes for sale nationwide, according to a recent study by the listing site Zillow. Couples can afford 82 percent.
The average single American can comfortably spend up to an estimated $176,098 on a home — which is less than the national median home value, and it could take over ten years to save enough for a downpayment (assuming that they are saving 10 percent of their income for a downpayment).
And, not only do single homebuyers generally have smaller budgets but they are competing for lower-priced homes that are in high demand, but low in supply, as evidenced by the results of the NAHB survey.
Affordability for singles is even more challenging in hot markets like New York City and San Jose, CA, where 10 percent and 1 percent, respectively, of available homes are affordable for the typical single.
Click here to read the entire release.