Photo: Robert Clark
A lack of affordability is keeping many American homebuyers in the market longer, according to the latest Housing Trends Report by the National Association of Home Builders (NAHB).
“Housing affordability is an increasingly serious problem in communities across America,” said Randy Noel, NAHB chairman, in a statement.
In the third quarter of 2018, 13 percent of adult Americans polled by NAHB said they were planning to purchase a home sometime in the next 12 months. And of that group, a little less than half were already actively engaged in the search.
Many respondents said that they are spending “significant amounts of time” looking. Some 54 percent of those prospective buyers actively looking for a home to buy have been searching for three months, or longer.
Nearly half of prospective buyers claimed that their home search was taking longer because they couldn’t find a home at a price they can afford.
This was followed by “not being able to find a home with the desired set of features” (40 percent) and “can’t find a home in the right neighborhood” (38 percent).
A separate survey by NAHB revealed that nearly three out of four American households believe that the US is suffering a housing affordability crisis — and the majority of respondents believe it is a problem at their local and state level as well.
Almost 70 percent of respondents believe housing affordability is an issue in their state and over half cite housing affordability as a concern in their neighborhood. Close to 60 percent said that if they were to buy a home in the near future, they believed that they would have trouble finding a home they could afford in their city or even in their county.
“This poll should serve as a wake-up call to policymakers at all levels of government to ease regulatory burdens that needlessly drive up the cost of housing and to enact policies that will encourage the production of badly-needed affordable housing units,” said Noel.
Since the housing bust, new construction has fallen off sharply while demand has continued to soar. As a result, home prices have skyrocketed in many of the country’s hottest markets and have begun to climb up in outlying markets as well as buyers expand their searches for affordable housing.
Demand for homes is high, but many builders are concerned about keeping overall costs down as supply dwindles.
“The skilled labor shortage is having the greatest impact on the slow growth rate of the industry. Housing could grow exponentially faster if there was more labor available,” Robert Dietz, NAHB chief economist, recently told Livabl.
The housing industry added between 80,000 and 100,000 new workers over the last year, but over 270,000 jobs still remain unfilled — a post-recession high.
Meanwhile, just over 60 percent of home shoppers say they will search as long as it takes until they find their dream home. Just over a third say they will expand their search and almost a quarter say they will buy a home older or smaller than planned — if necessary.
Only 18 percent of shoppers planned to give up if they are unable to find a home they can afford in the coming months, and just 16 percent said they would buy a pricier home if it came to that.