More Homeowners Choose to Stay Where They Are and Renovate

Laura Kusisto and Christina Rexrode reported yesterday at The Wall Street Journal Online that, “Despite rising home prices and a growing economy, U.S. homeowners’ mobility rate is stuck at a 30-year low as many opt to stay put rather than move to pursue job opportunities or trade up for more space.

The median duration of owners in their homes in 2017 was 10 years, according to data soon to be released  by the National Association of Realtors. That matched last year’s duration, which, along with 2014, was the highest level since the NAR started tracking the data in 1985.

“Americans aren’t moving in part because inventory levels have fallen near multidecade lows and home prices have risen to records. Many homeowners are choosing to stay and renovate, in turn making it more difficult for renters to enter the market.”

“Stuck in Place, U.S. Homeowners Hunker Down as Housing Supply Stays Tight.” The Wall Street Journal Online (October 29, 2017).

The Journal writers added that, “Housing starts fell 4.7% in September, the Commerce Department said, and remain about 40% below the 50-year average, which is unusual considering the economy and job markets are expanding strongly. In September, sales of previously owned homes declined on an annual basis for the first time since July 2016 as the shortage of homes continues to take a toll on the housing market.

The lack of new-home construction has helped create a bottleneck in the market in which owners of starter homes aren’t trading up to newly built homes, which tend to be pricier, in turn creating a squeeze for millennial renters looking to get into the market. Economists said baby boomers also aren’t in a hurry to trade in the dream homes they moved into in middle age for condominiums or senior living communities because many are staying healthy longer or want to remain near their children.”

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