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Dana Anderson of Redfin reports on housing affordability and its ranking among young voters in the U.S. 91% of Gen Z say that housing affordability is the top issue for them when considering who they will vote for in the presidential election. This was ranked above other items, including the economy, abortion, gun rights, and foreign wars. Millennials, Gen Xers, and baby boomers ranked the strength of the overall economy as their top factor when choosing a president. |
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Source: Redfin (June 2024) Redfin Senior Economist Elijah de la Campa comments on the survey results: “Housing affordability is a cornerstone of this year’s presidential election because even though the economy is fairly strong, unemployment is low and wages are rising, buying a home feels impossible for many Americans…This is particularly the case for young people, who have seen the cost of starter homes increase twice as fast as incomes. Young people care about other political issues, like immigration and abortion rights, but they’re more likely to cite housing affordability as a factor in their vote because it directly impacts the roof over their head, their lifestyle and their ability to build wealth.” The Fannie Mae Home Purchase Sentiment Index (HPSI) dropped 2.5 points in May to 69.4 as consumer attitudes toward homebuying reached an all-time survey low. Last month, only 14% of consumers thought it was a good time to buy a home, down from 20% last month, and 64% believe it’s a good time to sell, down from 67%. Consumers expect home prices and mortgage rates to increase over the next year. EY released a new report on this issue, highlighting that the U.S. faces a significant shortage of affordable rental homes. There is a deficit of 7.3 million rental homes available to low-income renters, with only 34 affordable homes available for every 100 extremely low-income renter households. The best way to encourage more affordability is to enable and incentivize local municipalities to upzone for greater density and reduce red tape for new development. We have seen an increase in the build-to-rent asset class, according to Bailey Schulz of USA TODAY. These communities are becoming increasingly popular as more cannot afford a down payment on a home. In 2023, approximately 97,000 residential homes were built to rent, marking a 45% increase from the previous year. Despite the growth, build-to-rent housing still makes up a relatively small portion of the market, accounting for an estimated 7.9% of all single-family housing starts in 2023. |