Would you go online to check out the value of a home belonging to a friend or acquaintance?
Of the 1,386 people aged 46 and younger responding to the survey, a full 66% admitted to going online to check out the value of homes owned by non-relatives in their social circle. And almost 80% of them end up getting “stressed, concerned, or upset” by what they find.
So, why check your neighbor’s / friend’s / kid’s preschool teacher’s home value, anyway?
According to 59% of respondents, the primary reason given was to use their findings as a “benchmark to measure [their] own income and worth.” Forty-two percent said they were trying to get a “sense of their [friends’] income.”
More than half (56%) say their own home-buying decisions are “somewhat” or “very much” influenced by the results of these online searches.
For the 80% of Gen Z and millennials stressed by viewing home prices of friends and acquaintances online, they should remember that lenders don’t benchmark borrowers against others to qualify for a home loan. They use the borrower’s profile, and you would be surprised how much a borrower can afford. Even with interest rates entering the Summer of 2023 higher at near 7%, millions of people qualify to buy median-priced homes with as little as 5% down. Jeff Taylor - Founder and Managing Director of Mphasis Digital Risk
Seventy-four percent of the survey respondents said they currently own a home.
PURSUING THE AMERICAN DREAM
Almost three out of four (74%) respondents agreed that homeownership is “part of the American Dream.” Nearly nine out of ten (87%) say buying a home is “currently too expensive,” and only 6% say now is an ideal time to shop for a home.
What the survey results show, aside from the respondents’ (understandably) dim view of housing affordability, is their reliance on digital tools to identify and evaluate their prospects.
And that reliance on tech creates an opening for mortgage lenders to move more of their services to the digital realm—meeting potential buyers where they are.
For the most part, respondents blame the government more than anything else for the lack of housing affordability. To address this, they would like local and state authorities to loosen zoning laws and restrictions on lenders:
- 45% blame state and local governments for current housing prices
- 70% believe the government “hasn’t done a good job” of making homes affordable
- Many say government authorities should lift restrictions that drive up costs, with 62% asking for looser consumer protection rules and relaxed restrictions on lenders.
- 72% say municipalities are more flexible with zoning rules to allow more homes—or alternative types of homes, including modular or 3D-printed.
It’s surprising to see that 62% of younger Americans call for lower consumer protection rules and restrictions on lenders. These rules were put in place after the Great Financial Crisis – which was caused by overly loose lending guidelines – to protect borrowers from getting into loans where the costs are low to start, then ballooned later.
But, first-time buyers should definitely talk to their local lender, because there are many specialty loans and down payment assistance programs that can help them in their community. These great Federal, state, and
Posted by:
July 6, 2023
