Homes feel less affordable today than they did 10 years ago

Sandra Bernardo

Homes feel less affordable today than they did 10 years ago, and even home buyers are increasingly considering “opting out” of homeownership, according to an Experian survey of people who purchased house within the past year or plan to purchase in the next year.

Here are some key findings:

  • 27% are opting out of home ownership in the next 5-10 years
    • 34% are ages 18-34
    • By region:
      • 32% West
      • 26% Northeast
    • By income:
      • 29% of consumers with 100K+ income, an increase of 16% from 2016
    • 37% cite a reason as wanting more flexibility to relocate and 26% do not want to carry as much debt and don’t want the responsibility of maintaining a home
    • 36% do not agree that there are enough houses on the market to choose from
    • 54% think houses today are less affordable than they were 10 years ago.
Sandra Bernardo

“With the cost of homes today and low inventory in many areas, it’s no surprise that many consumers either prefer to rent a home or resign themselves to renting because it’s the only option,” said Sandra Bernardo, manager of consumer education at Experian. “This has been the trend for several years since the housing bust. We’ll see if developers and communities address this issue in the future to build more starter homes to fit buyers’ pocketbooks.”

It’s a struggle for many to finance a home.

  • 56% are unhappy with their experience purchasing a home (future buyers).
  • 30% say there is more paperwork compared to the last time they purchased a home (recent buyers).
  • 43% say they were denied a home loan
    • 67% of this group say they were denied a loan due to a poor or limited credit history

“There’s no question that buying a home is a daunting endeavor, said Sandra Bernardo, manager of consumer education at Experian. “If purchasing a home is your dream, start planning now.  Assess your financials so you know how much you need to save for the down payment and monthly expenses.  Make sure to understand the home loan process and check your credit score and credit report to know where you stand prior to applying so there are no surprises.  A good credit score is key to earning the best interest rate, which can save you thousands of dollars in the long run.”

Homebuyers recognize the importance of credit and more are working to improve their credit.

  • 56 percent overall say they are working to improve their credit to qualify for a better home loan rate
    • 66% ages 18-34, up from 53% in 2016
    • 61% ages 35-54, up from 45% in 2016
    • 61% of males, an increase of 18% from 2016
  • 54% have delayed purchasing a home to improve their credit to get a better interest rate
    • 50% are ages 18-34

“One of the most important steps you can take when you are planning to purchase a home is to check your credit score and credit report,” said Bernardo.  “You should make sure you have a solid FICO® Score and that personal information on the report is accurate. Visit to obtain both (an Experian credit report only) for free. Your score can make the difference between getting approved for a loan and receiving the best interest rate or not securing your dream home.”