Americans live in their homes for much longer than before, creating a log of housing stock outside the market that helps explain why home sales have sputtered.
Homeowners nationwide remain in their homes typically 13 years, five years longer than they did in 2010, according to a new analysis by real estate agency Redfin. When owners do not shop with a larger home for a growing family or reduce their size as children leave, it picks up the market for buyers who come after them.
"If people do not move on, there are only fewer and fewer homes available to new home buyers," he said
Redfin's chief economist.
Several homeowners who have been exposed have contributed to the housing stock falling to the lowest level in decades, which has also contributed to pushing up prices on sales houses. Adjusted for the population, the stock of homes for sale is now near the lowest level of 37 years of record keeping, according to housing data company CoreLogic Inc.
Fewer homes for sale are a major reason why even ultralow mortgage loans, record levels of equity and a strong labor market has not started the weak housing market.
Economists say aging baby boomers are the biggest culprit because many stay healthier later in life and choose not to reduce their size. Some look around for the lack of smaller, less expensive homes and are loathe to go to war with the children's generation to get one.
States, such as California and Texas, have also implemented tax policies that make it easier for older residents to stay in place.
Barbara O. & # 39; Mara, a 67-year-old retired accountant, and her husband have lived in their home in Danville, California, about a half-hour drive east of Oakland, for 32 years.
The couple bought the house for $ 440,000 in 1
The couple was without power for four days as the local utility seeks to prevent the spread of wildfires, but O & # 39; Mara said they still have no plans to leave. “We would love a change. We would like to move to the sea, "she said.
There are few young people moving into the neighborhood, she added," because none of the old people are moving out. "
In the San Francisco metropolitan area, a typical homeowner stays 14 years, up from less than 10 years in 2010. Inventory over the same period has plunged over 46%.
Meanwhile, the Seattle subway has seen a huge influx of new jobs, and housing supply has not kept pace – homeowners living there for more than three years longer than they did in 2010. The inventory of homes for sale Seattle has fallen more than 50% in the last nine years, while home prices have risen more than 80%, according to Redfin.
Kristen Schriver and her husband found that their family of four had outgrown their 1,000-square-foot Seattle home, which she bought for $ 140,000 a couple of decades ago.
But Ms. Schriver, a 53-year-old recruiter, soon realized that prices had risen so much that homes did not bigger than theirs sold for $ 600,000. They couldn't afford to upgrade, so instead they demolished their home and built a new 2,000 square foot house.
"You always think this is my little little home," she said. "Then the market begins to change, surpassing what revenue does."
But this is not just a problem in expensive coastal markets. Homeowners live longer in each of the 55 metros that Redfin studied. Cities where it was once relatively easy to buy a house, see that owners lived much longer, and created a serious inventory.
The number of homes for sale noted last year and early this year, but in recent months it has fallen close to record lows in 2018.
The fall in inventory levels quickly dampened hopes that the housing market would decline in second half of the year. The pace of existing home sales fell by 2.2% in September, the National Association of Realtors reported last Tuesday.
The lack of mobility among homeowners is not the only reason the supply is small. Since the recession, housing construction has not kept up with demand due to labor and land shortages. The share of US-bought investors rose to an all-time high of 11% in 2018, according to CoreLogic. Some of these investors quickly tilt the purchases, but others make them single-family homes and hold them for years.
In Houston, homeowners live for more than 23 years, up from less than 15 years in 2010. Inventories in the same period have fallen 7%. One reason, say real estate agents and economists, is that the hot local weather means that few people leave the area when they retire.
The lack of homes is particularly acute in the Salt Lake City metropolitan area, where there are nearly 60% fewer homes for sale than they were nine years ago, according to Redfin.
Real estate agents say that house prices in the area have risen so much that it is difficult for many residents to afford to move.
Around Salt Lake City, owners now remain in the home for more than 23 years, or nearly nine years longer than they did in 2010, according to Redfin. The lack of homes has helped bring the median home price up nearly 75% over the same period to around $ 340,000.
"It's really a traffic jam," said Daniel Lopez, a Redfin agent in Salt Lake City.
Anjee Barber left San Diego to move to Salt Lake City, she and her partner thought it would not be difficult to find a house.
The couple spent a year looking before they finally found a five-bedroom, three-bathroom home with a small garden. When the sellers cut the price from $ 575,000 to $ 549,000, the couple made an offer and closed last week.
"This is no easier than it would have been in California," she said.
Scott Robbins, president of the Salt Lake Board of Realtors, said he is working with a couple looking for a house near downtown.
"On Saturday, a new list pops up and there are 14 views the first day because everyone just waits and waits and wait and boom," he said.
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