If you’ve been paying close attention like The Harton Team’s roster of buyer clients have, you know that housing demand continues to outstrip supply, with shortages now at their worst in 20 years. Why?
The answer is simple: Homeowners are happy where they are, according to a new survey by realtor.com®. Sixty-three percent of homeowners surveyed say their current house meets their needs, in fact, with baby boomer homeowners especially unwilling to move—a problem for succeeding generations, who are missing out on the 33 million condos and single-family houses boomers currently own. An overwhelming 85 percent of boomers surveyed have no plans to list their home for sale in the next year, with 72 percent reporting that their existing house suits their needs. Sixty-five percent of Gen X homeowners and 52 percent of millennial homeowners echoed the same sentiment.
Homeowners overall also see no need to uproot, the survey shows. Sixteen percent are not moving up due to their low mortgage interest rate (and 13 percent due to their low property taxes), 15 percent are remaining in place because they recently bought their home (a reason reported by 27 percent of millennial homeowners), and another 13 percent are staying put to make upgrades.
“Life events drive real estate transactions,” says Shannon Harton of The Harton Team at Nest Realty. “When the majority of homeowners feel their family needs are being met by their current home, there is nothing compelling them to put their home on the market.” Many are hesitant to sell, as well, because they know how high-priced and scarce homes are.
“Boomers indeed hold the key to those homes the market desperately needs, both in the urban condo and the detached suburban home segment,” Shannon says. “But with a strong economy and rising home prices, there’s really no reason for established homeowners to sell in the short term. Although downsizing might be on the minds of boomers, they face the same inventory shortages and price increases plaguing millennials.”
Fifty-nine percent of millennial homeowners surveyed have no plans to list their home for sale in the next year, but 35 percent do—and, of those, 60 percent are looking to trade up. If their plans pan out, the housing market could gain a boost in entry-level stock.
“The housing shortage forced many first-time homebuyers to consider smaller homes and condos as a way to literally get their foot in the door,” says Heather Harton, buyer specialist on The Harton Team. “The NAR survey data reveals that Richmond may see more of these homes hitting the market in the next year, but whether these owners actually list will depend on whether they can find another home.”
The key to making the most of this tight supply, of course, is keeping up-to-date with the latest local statistics and current market activity. The Harton Teams’ buyer client have instant access to, and up-the-minute alerts from, the Central Virginia Multiple Listing Service – our local MLS system. Want to get access yourself? Just drop us a note and we’ll set up a custom portal into the MLS that alerts you first as soon as new listing getting added. Information is power, in real estate as everywhere else!