The State Of Housing: The Housing Vibe Check
A deep dive into our annual housing report featured in The Guardian
If you're trying to get a grasp on the current societal vibe, look no further than the housing sector. This week, we're coming to you hot off the presses with our annual housing report, exclusively featured by The Guardian in “American dream of owning a home is dead, majority of renters say”. In my interview with the exceptionally astute reporter Lauren Aratani, I delve into why housing has become the epicenter of the low vibe culture.
“When you think about Maslow’s hierarchy of needs, 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”.
Lauren highlights in her article that: “The state of the US housing market underlines just how difficult the situation has become. Redfin estimates only 16% of home listings in 2023 were affordable to the typical US household. In comparison, 50% of listings in 2013 were affordable on a median income.”
This crisis isn't solely about the staggering cost of living; it mirrors a deeper trend. A substantial number of renters, despite aspiring to own a home, are engulfed by the fear that this cornerstone of the American dream might forever remain out of their reach. Our report reveals a palpable anxiety among many that, irrespective of their hard work, homeownership, and the American Dream is slipping away.
Here are the top 10 insights from our housing report:
Barely Livable: It's a sign of the times when 4 in 10 (42%) people describes their living situation as 'barely livable.' (renters: 62% v. homeowners: 38%)
Out of Reach Dreams: The American Dream is morphing into a daydream for renters, 62% of whom see no clear path to affording their own homes without pooling resources.
Hedging Market: The housing market has become a landscape of hesitation and hedge funds, with Americans deeply divided on whether to buy a home or hold off.
64% are waiting to see what happens to the housing market before making any significant decisions, and 71% worry that the housing market will only worsen
Over half (55%) believe that more home purchases will soon be in the hands of hedge fund companies rather than individual families
Flex Moves: Driven by a desire for better living conditions and affordability, 4 in 10 Americans are considering moving, a trend fueled by younger, BIPOC, and urban residents. While two-thirds of renters (65%) say financing their home might have to include outside-the-box methods (e.g., crowdfunding, rent-to-own, etc.).
Unlocking Ownership, Inheritance is the Key: Inheritance has become a key to homeownership for 72% of renters, highlighting the great wealth transfer as a pivotal factor in the pursuit of owning a home (but what if this doesn’t happen as planned?)
The Stasis of Uncertainty: With 70% of Americans finding themselves paralyzed by interest rates, a staggering 72% prefer to weather the financial storm rather than venture into an uncertain real estate market.
Bracing for the Surge: 71% of Americans brace for worse to come, especially renters and those actively house hunting, expecting housing prices to continue rising.
Diverting Housing Funds: Over half of renters (55%) say they’d rather spend their money living in the now than worrying about affording a home later (we expect travel, experiences and second hand luxury markets to be the winners here).
Climate Calculus: The calculus of home buying now invariably includes the variable of climate change, with 63% of potential buyers integrating natural disaster risk into their decision-making process. The tangibility of climate change escalates, directly influencing personal finances as 42% of homeowners witness their insurance premiums swell in the wake of natural disasters (meanwhile in some states consumer scramble to even find insurance).
AI Open: Nearly half of the nation is open to leveraging AI for housing solutions, indicating a significant shift in how trust is placed and decisions are made in the housing search process.
Why It Matters
These insights seek to connect the dots between individual sentiments and broader society trends, highlighting the profound psychological and societal implications of the housing shortage. This report is not only about outlining housing challenges but also about emphasizing the pressing opportunity for creative and innovative solutions to create more housing security for more people. Moreover, even for those not directly involved in the housing sector, it's crucial to contemplate and envision the future of the American Dream without housing as its central pillar. We must question what could stand in its stead and how we might welcome such a future, ensuring it aligns with our collective pursuit of psychological well-being and fulfillment.
Shout out to Tim Osiecki, Ethan Hermann, and Jacklyn Cooney for leading this report!
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Penned by Libby Rodney and Abbey Lunney, founders of the Thought Leadership Group at The Harris Poll. To learn more about the Thought Leadership Practice, just contact one of us or find out more here.
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