Because of the coronavirus pandemic, many prospective first-time homebuyers had to put their dream on hold as they worked to rebuild their finances. But with more Americans vaccinated and the summer homebuying season in full swing, new findings indicate that some would-be homeowners are ready to make their next move.
In its First-Time Homebuyer Study, Chase discovered that the majority (69%) of consumers looking to buy their first home still see homeownership as an important way to build wealth. As a result, 60% of respondents are likely to purchase a home in the next 12 months, with 40% of them being either "very likely" or "extremely likely" to do so.
Would-be homebuyers prepare their finances for the big purchase
The economic impact of the COVID-19 pandemic forced many prospective homebuyers to put their dreams of homeownership on hold for the time being. Many respondents changed their plans on buying a home last year because:
- They were waiting to see how the housing market would play out (70%)
- They experienced a change in income (61%)
- They were reevaluating how they would finance their home purchase (58%)
Due to a loss of income, many of those who were actively preparing to purchase in 2020 saw a decrease in both their confidence (41%) and their budget (37%) as well.
However, with the number of home listings expected to go up this year and with many consumers focusing on rebuilding their finances, things are looking up for homebuyers in the US.
Still, only about 1 in 4 homebuyers report strong confidence in their financial ability to buy a home in the first half of 2021. Others are taking steps to prepare their finances for the big purchase, including:
- 7 in 10 respondents who have made lifestyle changes in order to work toward homebuying success
- 77% of respondents who are actively saving for a down payment
- 66% of respondents who have created a monthly budget and are working to improve their credit score
- 51% of respondents who plan to research down payment assistance programs (and 33% who have already done so)
Black and Latino respondents display high confidence despite facing greater financial hardships
The Chase survey also revealed that, despite facing more obstacles than the general population, Black and Latino respondents show greater confidence in the homebuying process.
A different survey from NeighborWorks America found, for example, that Black and Latino homebuyers have greater difficulty securing a home purchase than white adults — a problem that has only been exacerbated by the health crisis, as Chase found that 64% of this demographic group were forced to reassess how they would finance their home.
Despite these concerns, Black and Latino respondents have a more favorable view of the homebuying process than than their peers. Specifically, the survey found that Black and Latino homebuyers:
- Are more knowledgeable or comfortable with the homebuying process (48% versus 40% of the general population on average)
- Expect the homebuying process to be more enjoyable (65% versus 51% of the general population on average)
Methodology: Between March 10-24, 2021, Chase surveyed 1,100 consumers in the US who have never owned a home and are looking to purchase one.