More homeowners on the move could help with the housing shortage
|Years in home||2018-2019 percent moving||2019-2020 percent moving||Year-over-year change|
|1 to 4||7.69%||9.35%||1.66%|
|5 to 9||5.24%||6.64%||1.39%|
|10 to 14||4.45%||5.59%||1.14%|
|15 to 19||4.43%||4.79%||0.36%|
|20 to 24||8.06%||8.13%||0.07%|
|25 to 29||11.06%||12.58%||1.52%|
|30 to 44||6.87%||7.33%||0.46%|
|45 to 64||3.58%||3.99%||0.41%|
|65 to 74||2.39%||2.68%||0.29%|
Homeownership rates and sales data are always important. But it's also interesting to look at the number of existing homes coming onto the market — something that can have a huge effect on the inventory of homes for sale.
Looking at the chart above, it seems that the seller's market that flourished in 2020 enticed more homeowners to put their homes on the market. Possible factors include:
- Historically low interest rates have increased demand
- A continuing inventory shortage that helped push home prices up
- An increase in the number of people working from home and no longer tied to a location
However, while it's clear that more homeowners entered the market, it's interesting to consider how homeowners with different lengths of ownership responded to the situation.
For instance, the Year-over-Year (YOY) increase of 1.66% in the 1- to 4-year owners and 1.39% in the 5- to 9-year owners seems likely to be the result of people taking advantage of low rates and the increase in equity to move into something possibly bigger or more expensive. They may also be taking advantage of the freedom of working remotely, which could allow them to seek areas with a lower cost of living.
The group of 10- to 14-year owners would have bought at high prices just before the housing crisis. The spike of 1.14%, for a total of almost 6% moving, could mean that home values have increased to the point where these owners are finally able to sell and get back their original investment.
On the other hand, there's not much difference YOY for the 15- to 24-year homeowners, possibly because these are established families who want to stay settled.
Finally, the significant increase of 1.52% for the 25- to 29-year owners could indicate that empty nesters are seeing a good opportunity to downsize or relocate while making the most of their equity.
1 Source: U.S. Census Bureau, Current Population Survey, 2020 Annual Social and Economic Supplement.
2 Source: U.S. Census Bureau, Current Population Survey, 2019 Annual Social and Economic Supplement.
3 "A Quarter of Homeowners Haven’t Moved in 20 Years," REALTOR® Magazine, January 25, 2021.
MAP3514491 | 03/2021