High mortgage rates and double-digit growth in home prices since COVID-19 have brought housing affordability to its lowest level in more than a decade.  Given this reality, a recent NAHB study on housing preferences* asked home buyers about which specific compromises they would be willing to make to achieve homeownership. For 39% of buyers, accepting a smaller lot is the path to affording a home.  This finding highlights the paramount importance of reforming zoning laws that mandate lot sizes, as nearly 4 out of 10 buyers would be willing to give up land in exchange for owning a home.  For 36% of buyers, accepting fewer exterior amenities is the way to homeownership—they will simply add that deck or patio at some point in the future.  Another 36% were willing to move farther from the urban core and 35% will accept a smaller house if that’s what it takes to buy it. But what areas of the home, specifically, should shrink to reduce the overall footprint of the home?  Most buyers who will take the smaller house compromise sent builders and architects a clear message: shrink the home office (53%) and the dining room (52%) to save on square footage.  Also, loud and clear in the message: leave the kitchen (only 21% would want that smaller) and closet space (22%) alone. *  What Home Buyers Really Want, 2024 Edition sheds light on the housing preferences of the typical home buyer and is based on a national survey of more than 3,000 recent and prospective home buyers.  Because of the inherent diversity in buyer backgrounds, the study provides granular specificity based on demographic factors such as generation, geographic location, race/ethnicity, income, and price point. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

NAHB’s latest study on consumer preferences—What Home Buyers Really Want Study*— asked about the features and amenities buyers want in the home, but also about the type of community where they would like to live.  The question is important because the home that successfully appeals to buyers doesn’t exist in a vacuum—it sits inside a community they evaluate as thoroughly as the home itself. Our findings reveal that the ideal community offers three main attributes: convenience, walkability, and a suburban feel.  This conclusion is gleaned from the top five features buyers most want in a community, which are being close to retail space (e.g., pharmacy, grocery store) (70%), near a park area (66%), walking/jogging trails (66%), a walkable community (pathways connecting homes to transportation, shopping, etc.) (65%), and a typically suburban community (64%). In terms of the overall location where buyers would prefer to purchase a home, 53% would like to buy in the suburbs (either close-in or outlying), a rural area (25%), or the central city (downtown or outside of it) (23%).  The study also asked buyers about the farthest distance they are willing to travel one-way from home to work.  For the typical buyer, that sweet spot is 11.3 miles—which is not surprising given that most report a desire to live in the suburbs. *  What Home Buyers Really Want, 2024 Edition sheds light on the housing preferences of the typical home buyer and is based on a national survey of more than 3,000 recent and prospective home buyers.  Because of the inherent diversity in buyer backgrounds, the study provides granular specificity based on demographic factors such as generation, geographic location, race/ethnicity, income, and price point. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

A recent NAHB study on home buyer preferences* found that a single-family detached home remains the first purchase option for two of every three buyers.  Far smaller shares are looking to buy a townhome (16%), a multifamily home (10%), or a manufactured home (5%). In the face of such strong preference for a detached home, and given the significant growth in home prices and lot values in recent years, the study aimed to understand what size discount would give buyers a strong enough incentive to buy a townhouse instead of a detached home.  The question specified a critical assumption: the townhouse would be in the same location as the detached home, have the same square footage of finished space and include the same quality materials.  In other words, the townhouse would be comparable to the detached home in every practical way except for the size of the land around it. Our findings show that, on average, buyers would need a 30% discount to consider buying a (mostly) comparable townhouse instead of a detached home.  Yet previous NAHB research has shown that the finished lot only accounts for about 18% of the price of a new detached home.  This means that in most cases, it is simply not feasible for builders to offer a 30% discount for a townhouse of the same size, quality and location as a detached home– even one sitting on the smallest possible plot of land. *  What Home Buyers Really Want, 2024 Edition sheds light on the housing preferences of the typical home buyer and is based on a national survey of more than 3,000 recent and prospective home buyers.  Because of the inherent diversity in buyer backgrounds, the study provides granular specificity based on demographic factors such as generation, geographic location, race/ethnicity, income, and price point. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

According to the latest What Home Buyers Really Want Study*, the vast majority of home buyers are looking for a home with at least one home office (or space dedicated to work/study).  More specifically, 66% would prefer to buy a home with exactly one home office, 13% want at least two offices, and 20% want none (Fig. 1). As homes continue to get smaller, understanding how much square footage buyers want to dedicate to a home office is a must.  When asked, 59% of buyers interested in having a home office said it should be medium size (100 to 150 square feet).  Much smaller shares of 22% and 19%, respectively, want the home office to be large (more than 150 square feet) or small (under 100 square feet). More granular findings show that younger buyers as well as wealthier buyers are particularly in favor of home offices. Among Gen Z buyers, for example, 90% want at least one home office, compared to 75% of Boomers.  Likewise, 92% of buyers in the $150,000+ income bracket would like at least one office, compared to 65% among those earning under $50,000. *  What Home Buyers Really Want, 2024 Edition sheds light on the housing preferences of the typical home buyer and is based on a national survey of more than 3,000 recent and prospective home buyers.  Because of the inherent diversity in buyer backgrounds, the study provides granular specificity based on demographic factors such as generation, geographic location, race/ethnicity, income, and price point. Discover more from Eye On Housing Subscribe to get the latest posts to your email.