LendingTree®, the nation’s leading online loan marketplace, released its findings on a survey of more than 1,000 potential homebuyers. The survey found that amid historically low mortgage rates and a limited number of affordable homes for sale, buyer competition is heating up. That pressure is forcing many potential buyers to consider stretching their budget to get in the game.
- 64% of homebuyers are willing to go over budget for their perfect house.
- When homebuyers were asked what they feel is most important when looking for a home, the top three responses were: location (30%), a home within budget (27%) and enough space (24%).
- More than a third (37%) of buyers say finding a home within their budget is the most stressful part of the process.
- Black and Hispanic homebuyers were about twice as likely as white buyers to say applying for a mortgage is the most stressful part of the homebuying process.
- About 1 in 6 buyers say they stress most about finding a home because of the low housing inventory in their area.
- Another 16% are most stressed about trying to sell their current home.
- More than 1 in 10 buyers said that they didn’t feel their mortgage lender was effective at explaining their available loan options.
- 33% of homebuyers plan to stay in their next new home for at least 15 years, while another 18% say they’d live in their next home for less than five years.
While going over budget may be tempting, LendingTree’s Chief Economist, Tendayi Kapfidze, says it’s not a good idea: “I urge homebuyers to be very cautious about going over budget. Many people underestimate the maintenance costs of owning a home. If you are stretched financially and underinvest in maintenance it can diminish the value of your home.”
To view the full report, visit: https://www.lendingtree.com/home/mortgage/nearly-two-thirds-of-homebuyers-would-go-over-budget-for-their-dream-home/
For this survey, LendingTree commissioned Qualtrics, an experience management firm, to gather responses from 1,006 homebuyers, with the sample base proportioned to represent the overall population. The survey was fielded April 24-30, 2020.
We defined generations* by using the following age ranges:
Millennials: ages 24-39
Generation X: ages 40-54
Baby boomers: ages 55-74