As affordability challenges continue to strain the pool of prospective buyers, new data from realtor.com® indicates that relocating is growing in popularity among house hunters looking to move out and up.
While inventory constraints continue to weigh on the spring market, a May 24th survey showed that buyers continue to be squeezed out of the market as elevated inflation and climbing home prices influence their home searches and buying patterns.
The survey found that 63% of this year’s seller-buyers—home sellers looking to buy their next home at the same time—will likely be priced out of the market if costs keep rising. It also indicated that 45% of 2022 seller-buyers plan to buy outside their current town in search of lower prices.
- Seventy-two percent of sellers in the 2022 market and 15% of homeowners are “seller-buyers.”
- Thirty-nine percent of respondents said inflation and rising home prices were two of the most impactful market conditions influencing their plans.
- Seller-buyers’ top concerns were selling and buying simultaneously, managing the financial logistics of both transactions, home prices, and finding a home to buy within their budget.
- Nearly half (45%) of 2022 seller-buyers plan to buy outside their current city/town, including 9% who anticipate moving to another state.
- The key factors driving seller-buyers to consider a cross-market move included the lower cost of housing (25%), more access to outdoor activities (19%), and proximity to family and friends (19%).
- Roughly half of the respondents target prices of $500,000 and below on both the sell (49%) and buy (53%) sides of their transaction.
- The size and cost of a home are among the top factors that seller-buyers would like their next home to differ from their current one.
- The top reason homeowners were moving was growing households, whether moving in with a partner, having children, or caring for parents.
“This year’s housing markets remain hampered by insufficient supply, which is compounded by the forces of rising inflation and mortgage rates,” wrote George Ratiu, senior economist & manager of Economic Research at realtor.com®. “The silver lining to the overhanging affordability clouds is that a growing number of homeowners are planning to list their properties for sale, offering a reprieve from the inventory shortage. At the same time, many of these homeowners are working through the same challenges as other buyers, seeking affordable housing options amid a landscape of rising prices and financing costs.”
In a separate statement, Ratiu also said, “While an increase in new sellers could play a critical role in the inventory recovery, nearly three-quarters of surveyed homeowners who plan to sell are also buying a home this year, adding complexity to an already complicated task.”
“As seller-buyers, many stand to profit from record-high home prices, but are also challenged by the lack of affordable listings and rising cost pressures. Still, our survey data offers hope for the success of this year’s seller-buyers, potentially enabled by trends that have accelerated during COVID like the rise in remote work, which shows significant sticking power. Many move-up buyers are leveraging newfound flexibility to employ creative strategies, such as relocating to an area offering homes that meet their family’s needs without breaking their budgets.”