“A lack of supply has been a persistent buyer’s challenge in the housing market since the financial crisis,” said Tendayi Kapfidze, LendingTree’s chief economist. In addition to there being insufficient new home construction due to expensive material and labor costs, “…there is a decreased supply of existing homes available for sale, which accounts for a much larger share of the total housing market than new construction.”

Why aren’t sellers selling, particularly sellers who would ordinarily be pegged as sellers due to age and a desire to downsize once their families now have families of their own?

LendingTree, an online loan marketplace, perused data from the December 2018 US Census Bureau’s American Community Survey to find out. Its findings? Homeowners, particularly in the Northeast, are staying put in their homes due to…

  • fears of another financial crisis
  • fears of reduced labor market mobility
  • fears that rising interest rates would make another home too expensive

Here are the Top 10 Cities with the Longest Tenure and their respective Median Home Value Appreciation between 2014 – 2017:

 

City            Aver.         Aver. Age  2017 Median    Aver. 3 Year

Tenure      of Owner  Home Value      Appreciation

Pittsburg     7.54 years     55.58     $153,300           14%

New York    7.53 years      55.95    $440,900           11%

Buffalo       7.50 years      55.54    $148,900           19%

Philadelphia 7.49 years     54.49    $250,900           7.2%

New Orleans 7.49 years     55        $193,100           11%

Hartford        7.45 years  54.49      $247,600           2%

Cleveland      7.44 years   55.88      $150,400           9%

Los Angeles   7.42 years   55.92      $617,100           25%

Providence     7.40 years   55.16      $277,400           11%

Memphis         7.37 years   54.54     $148,800           12%

It turns out that the average tenure of the top 10 cities with the longest owner occupied tenure was 7.46 years and the average three year home price appreciation was +12%. Appreciation rates in Los Angeles are clearly distinct among these cities.

The 10 cities with the shortest owner occupied tenure (an average of 6.63 years, had a higher average home price appreciation of +30%. Look at the three cities with the shortest owner occupied tenures:

  • Las Vegas – average owner-occupied tenure of 6.36 years and three year home price appreciation of +32%
  • Phoenix – average owner-occupied tenure of 6.43 years and three year home price appreciation of +25%
  • Austin – average owner-occupied tenure of 6.49 years and three year price appreciation of +30%

All but one of the lowest 10 owner-occupied tenure cities, Denver, are warm weather areas and all those cities reflect high migration rates.

For a further look into LendingTree’s findings on owner-occupied tenure rates and home price appreciation rates, go to

https://www.lendingtree.com/2019/01/homeowners-in-the-northeast-stay-in-their-homes-the-longest/