Most Americans would rather stay in their current home and make renovations than move, according to a new study from Zillow.
The real estate tech company’s latest “Housing Aspirations” report finds that 76 percent of Americans would rather use a set amount of money to upgrade their homes, as opposed to using that same set of funds as a downpayment on a house.
“Even in a seller’s market, simultaneously buying and selling is an exercise in frustration,” said Skylar Olsen, Zillow’s director of economic research and outreach. “Add to that the emotional history between you and your home and it’s no wonder low inventory has been in a self-fulfilling cycle.”
“Homeowners may hesitate to sell because of limited options for them as buyers, but by holding on to their homes, they are themselves contributing to low inventory,” added Olsen.
Older or retired Americans are even more likely to want to stay in their own homes, according to the study. Overall, 87 percent of people 55 and older – and 91 percent of retirees would rather renovate than move.
The biggest reasons homeowners are hesitant to move is a combination of dreading the move – and the costs associated with moving – and a lot of homeowners just generally really like their current homes. A separate study from Zillow on consumer trends found recently that 83 percent of respondents love their homes and 63 percent don’t have any plans to sell their homes.
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Rising mortgage rates, which have climbed steadily this year, are another impediment to wanting to move. Many current homeowners purchased at a lower rate and don’t want to be taking on a pricier new mortgage.
The combination of not wanting to move and homeowners loving their current homes is at least one reason that inventory has fallen steadily the past few years, according to Zillow. Nationally, the number of homes for sale has fallen year-over-year for nearly four straight years, although the pace of that decline has fallen in recent months, according to Zillow.
Not every segment of the population has little interest in moving, however. Zillow’s survey found that respondents ages 18-34 that currently rent are most likely to use their money for a downpayment on a house.
Regionally, 80 percent of homeowners in Boston and Detroit said they would choose to stay in their current home and make updates versus move. Los Angeles had the highest share of respondents that would use the money for a downpayment, but still, more than two-thirds of respondents said they would rather just make renovations.
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