A Quarter of Homeowners Haven’t Moved in 20 Years
One in four homeowners have lived in their home for more than 20 years—the highest level that owners with that tenure has ever reached, a new Redfin study shows. That’s due in large part to the aging in place trend, which is accelerating during the COVID-19 pandemic. As Americans stay in their homes longer, housing shortages are growing. The typical homeowner in 2020 had lived in their home for 13 years, a big jump from 8.7 years a decade earlier, according to the Redfin study.
Longer homeownership tenure has contributed to a logjam in housing inventory, which dropped 23% year over year in December to an all-time low: a 1.9-month supply at the current sales pace, according to the National Association of REALTORS®. “It will take vigorous new-home construction in 2021 and in 2022 to adequately furnish the market to properly meet the demand,” NAR Chief Economist Lawrence Yun said in a statement last week.
The COVID-19 pandemic is likely sidelining many potential home sellers who don’t want to risk infection by allowing strangers inside for tours. Potential sellers also may be concerned about their ability to find a new home. Tight inventory is pressing on home prices: The median existing-home price in December was $309,800, up nearly 13% compared to a year earlier, according to NAR.
“We are in a really huge supply crunch,” Daryl Fairweather, chief economist at Redfin, told The Wall Street Journal. “It becomes a cycle where people don’t want to move because it’s so difficult to buy a home, and then that, in turn, makes it even more difficult to buy a home because people aren’t moving and freeing up inventory.”
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Source: “1 in 4 U.S. Homeowners Have Lived in Their Home for Over 20 Years—the Highest Share on Record,” Redfin (Jan. 21, 2021), “Housing Market Stays Tight as Homeowners Stay Put,” The Wall Street Journal (Jan. 21, 2021) [Log-in required.] and Realtor Magazine
"Copyright NATIONAL ASSOCIATION OF REALTORS®. Reprinted with permission."