After years of widespread, often breakneck growth in the housing market, 2019 marked a definitive turning point: Rent growth stabilized, home value growth cooled considerably and the balance of power between buyers and sellers – long-dominated by sellers – began to slowly shift.
The ways in which American renters, homeowners, home buyers and home sellers respond to these changes illustrate an enduring but also evolving, American Dream, and the role that Home plays in it. The roof over our heads remains our most basic need, and an examination of the sacrifices, choices and/or circumstances that help put it there offers a critical view into the motivations, stresses, successes and challenges that collectively shape the $30 trillion U.S. housing market.
The Zillow Group 2019 Consumer Housing Trends Report is that examination, a tool intended to help a wide audience of journalists, policymakers, industry professionals and consumers identify emerging trends, quantify how different groups react to them and ultimately empower smarter housing decisions.
There are abundant differences among renters, buyers and home sellers, but what stands out in the data is a shared refrain: Finding and moving into a new home is stressful. Almost every home seller (95%) is stressed by some aspect of the process, whether that includes the uncertainty of selling in their desired window, getting the right price and/or worrying whether an offer will fall through. Renters and buyers share similar concerns over budget and timing, and a majority of both make at least one sacrifice in order to make all the moving pieces fit.
The challenges faced by those with personal debt are also universally shared, impacting the type of home someone can afford to rent or buy, their timeline for buying, their ability to afford an adequate down payment and, ultimately, whether or not they are approved for a mortgage. More than two-thirds of renters (69%) have personal debt of some kind, along with 54% of homeowners (beyond their mortgage). A comfortable majority (58%) of home buyers with debt say they worried they wouldn’t qualify for a loan, and roughly a quarter of renters and buyers said their debt caused them to be denied home financing or a rental agreement at some point.
Even so, clear differences emerge among racial, socio-economic and generational lines. White renters reported smaller rent increases and were less likely to pay application fees than their black, Asian and Hispanic peers. Roughly one-in-five of the nation’s youngest renters get help from their family to pay the rent, more than double the share of the next-youngest generation. And perhaps owing to experience – or lack thereof – younger home sellers, particularly first-time home sellers, are more likely than their older peers to say that any given aspect of selling is stressful.
As the market continues to shift and evolve, so too does the number and variety of tools and technology available to renters, owners, buyers, sellers and their agents. The willingness and ability of different groups to embrace these new tools – in whole, in part or not at all – will go a long way in helping determine how the real estate industry itself can and should adapt to meet their needs and soothe their stresses.
In 2019, Home is as important to the American consumer as it has ever been – even as the ways and means involved in finding and affording it are drastically different than they were even a generation ago. We hope the Zillow Group 2019 Consumer Housing Trends Report helps illuminate both what has changed and what remains the same in real estate. We trust these insights will lend useful and grounding data to what is one of the most emotional, but also emotionally rewarding, life events: Finding Home in America.