In ValueInsured’s latest Modern Homebuyer Survey, millennial homeowners reported concerns for housing overvaluation, and rising pessimism for home price futures. One would expect millennial homeowners – being in the enviable position of owning in this seller’s market – to rejoice at rising home prices, but their reported sentiments tell an opposite story. Any rise in their home equity wealth on paper is negated by their concern for a pending correction, and the worries that they could be “buying high” if they were to upgrade now. The result? inventory shortage particularly for starter homes.
Some experts have theorized that recent years of record-low mortgage rates contributed to reluctance to sell, as homeowners do not want to give up their newly refinanced low mortgages. This is certainly a factor, yet might not be as influential as previously assumed. ValueInsured found in its Modern Homebuyer Survey that only 18% of interested, but hesitant, sellers point to their low mortgage payment as a key reason they are putting off selling. On the other hand, 57% say they are not selling because they are concerned with buying high in today’s low-inventory, inflated market. Chicken, meet egg.