Three out of four recent homebuyers have regrets

U.S. homeownership rate has been rising since 2016, but is now at risk from inflation and interest rates.

72% of those who purchased a home in 2021 or 2022 regret their decision, according to a recent study by Anytime Estimate. This does not necessarily mean that they are not happy with the purchase they have made. Only one in five, 22%, were dissatisfied with the transaction, and only one in three believed they paid too much. But there are more issues at stake, such as fears about rising interest rates, the future value of housing or the overall performance of the economy. At this point, it is worth remembering that 12% of Americans lost income in July.

The median home price for first-time homebuyers is currently $510,000, 13% more than what buyers paid in the past ($450,000).

Difficult conditions

As the report concludes, recent buyers "haven't benefited from rising home values, but they were willing to spend more on their home purchases". These individuals face a bleak outlook. Housing supply has fallen and housing prices, after decades of low interest rates, are very high. However, fear of inflation is forcing the Federal Reserve to raise rates, which has a dual effect on homeowners with mortgages: it increases the cost of mortgages and drives down the present value of the home.

Waivers in order to purchase

Americans' desire to buy a home persists, even if it forces them to make compromises: they don't buy their dream home or they have to face a higher-than-expected price tag.

When asked "how did the housing market impact your home-buying expierence," 40% said they have benefited from low interest rates. Other answers specify how they have had to adapt to undesirable circumstances. Thus, 38% said they have had to increase what their budget, 36% acknolowedged that they have had to use up other plans to be able to buy the house, and another 36% said they have had to expand the area in which they were looking for a house.

In addition to that, 27% have been forced to buy a smaller home, and 25% have had to delay their plans.

New buyers accounted for 70% of purchases since 2021. Of these, two-thirds, 66%, were millennials.

The house is one of the symbols of the American dream. Two out of three Americans (65.8%) own their homes. Since 2016, the ownership rate has been rising consistently.

Now, that desire of Americans is at risk. The drop in home sales and purchases is unprecedented. And 62% are worried about not being able to afford housing.