The once quintessential American dream of homeownership seems to have faded into the realm of fantasy for numerous renters, according to a recent survey conducted by the Harris Poll Thought Leadership and Future Practice.
The findings, released exclusively to The Guardian, articulate a dire situation where areas have soared to levels of unaffordability, rendering them “barely livable.”
“When you think about Maslow’s hierarchy of needs, and housing is right at that foundational level of security, the implications on consumer psyche when things feel so unaffordable is something that will impact everyone,” said Libby Rodney, chief strategy officer at Harris Poll. The American dream of owning a home “is looking more like a daydream for renters.”
A diverse group of participants identified as renters or homeowners were canvassed in the poll. Catering to various demographics, respondents shared their sentiments on homeownership within the country. Particularly for renters, the perspective is grim.
Despite a majority of renters desiring eventual homeownership, a staggering 61% harbor concerns that such an ambition may never materialize for them. An equivalent fraction of respondents are resigned to the belief that no matter the extent of their labor, affording their own home is unattainable.
The U.S. housing market paints a vivid picture of the challenges presented. A Redfin analysis indicates a mere 16% of home listings in 2023 were within financial reach for the average American household, a stark contrast to the 50% deemed affordable in 2013, the Guardian reported.
Complications in the housing market arose during the pandemic years. Home sales skyrocketed to 6.1 million in 2021, a peak not observed since 2006, just before the housing bubble burst. Yet, in the wake of unprecedented inflation peaking during the summer of 2022, the Federal Reserve initiated a series of interest rate hikes.
The subsequent rise to a 7.79% 30-year mortgage rate in 2023, the highest in two decades, triggered a nosedive in home sales to a 30-year low, according to the National Association of Realtors.
In light of these developments, the Harris Poll indicates a prevalent hesitance among Americans, cutting across both renters and homeowners, to engage in real estate transactions amid the current economic climate.
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