High Interest Rates Not Deterring Americans’ Pursuit of Home Ownership
Housing Demand Caught Between High Rates & Demographics
The National Association of Home Builders (NAHB) on Monday (10-23-23) released the final issue of the Housing Trend Report (HTR) series. According to the HTR, even with mortgage rates topping 7%, Americans continue to pursue their desire to buy a home.
In Q3, the share of adults with plans to purchase a home increased to 17%, up from 15% in Q2. The NAHB notes that the trend has vacillated up and own without a clear trend for over a year, likely due to the two opposite factors of higher interest rates and higher home prices and persistent demand stemming from demographic growth.
The HTR reports that interest in newly built homes continues to increase as the lack of existing home inventory continues to shrink, which in turn is leaving new homes as the only option in many areas. In Q3, 27% of potential buyers were looking to buy new construction, up for a third consecutive quarter after declining to 20% in 2022Q4.
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