- Potential homebuyers in 2021 facing tough year
- Latest Harris Poll for NerdWallet 2021 Home Buyer Report lists common obstacles potential homebuyers believe stand in their way of home ownership
Pandemic-Inspired Home Sales Hit Record Highs in 2020
Despite the COVID pandemic, home sales went through the roof in 2020. Because of the COVID pandemic, record-high home prices, record-low inventory levels and more restrictive borrowing criteria also became the reality in 2020.
Potential Home Buyers in 2021 To Face a Tough Market
All of the happenings mentioned in the above paragraph about sales, prices, inventory levels and tighter credit requirements for borrowers are continuing into 2021 with no sign of let-up in sight. In addition, the latest Harris Poll done for NerdWallet’s 2021 Home Buyer Report points to additional obstacles for potential homebuyers planning to buy this year.
Just Do the Math
Extrapolating from NerdWallet’s report, approximately 11% of the US population hopes to buy a home in 2021. That 11% translates into some 28M potential buyers competing for about 5M homes, the average number of homes sold each year over the last few years. It doesn’t add up, right?
On the other hand, half of those who planned to buy a home in 2021 thought their income, credit rating and/or the economy would be stronger this year than last. And, according to Elizabeth Renter, author of the NerdWallet survey, “Fifty-nine percent of first-time buyers who planned a (home) purchase in 2020 said they did or were in the process. Only 28% of second or subsequent homebuyers who planned a purchase followed through in 2020. That’s a big difference!”
Obstacles Preventing Buyers from Pursuing Homeownership, according to NerdWallet 2021 Home Buyer Report
38% – Not enough saved for down payment
32% – Credit score
31% – COVID pandemic
29% – Low income
25% – Lack of available inventory within budget
or preferred area
20% – Current economic climate
18% – Current amount of debt
15% – Lack of affordable homes near work or
preferred school district
11% – Local housing market too competitive
5% – Belief that mortgage rates to drop in future
5% – Other
Thanks to NerdWallet and The New York Times.