In the wake of one of the most active years in the real estate market, many buyers made hasty decisions to get their offer accepted. From the pressure of bidding wars to wanting to take advantage of historically low interest rates, several factors caused some buyers to rush into homeownership. According to a recent report from Hippo, these new homeowners are feeling a significant lack of preparedness. In fact, 33% of surveyed homeowners said they felt at least somewhat unprepared for homeownership—of those, 51% said they were even less prepared than they thought upon moving in.
Key findings from the report:
- 92% of those who purchased a home in the past five years said this was their first home purchase.
- 68% paid over asking price.
- 36% paid a down payment greater than 20%.
- 81% had unexpected repairs in the first year.
- 84% who felt at least slightly unprepared had unexpected issues within the first year.
- 5% of homeowners report having no unexpected repairs so far.
- 33% of U.S. homeowners said they felt at least somewhat unprepared for homeownership.
- Of those, 51% said they were even less prepared than they thought upon moving in.
- First-time owners were 318% more likely than existing homeowners to say that climate change considerations factored into their home-buying decision; 60% said building materials played a role in their search, and 57% said geographical location factored in
- For advice on homeownership, 94% turn to friends and family, and 77% said they would ask their real estate agent.
“One of the key insights,” stated Jessica Holcomb, author of the report, “is just how unprepared new homeowners felt as they entered their new homes and readied themselves for mortgage payments and home-maintenance responsibilities. Beyond the paperwork and moving boxes is a whole new world for many first-time homeowners.”
“Many first-time homeowners have a difficult time understanding and caring for their new spaces,” Holcomb notes, “Some have a tough time locating the main water shut-off valve, figuring out what to do with the fuse box or identifying the source of water leaks, for example.
“While new buyers recognize the importance of home maintenance, many of them said they didn’t have the foresight and know-how needed to handle unexpected costs. First-time homeowners jumped in headfirst, and many faced unexpected repairs and surprises in their first year.