Housing Envy Among Young Americans

Mortgage News July 6, 2023

In a recent survey conducted by Mphasis Digital Risk, involving 1,386 individuals aged 46 or below, it was found that 66% of this group admitted to frequently going online to assess the worth of properties owned by friends and acquaintances. Moreover, they expressed a sense of envy towards others, comparing their possessions with those of others.

Furthermore, the survey revealed that out of the respondents who engage in online home value searches, a staggering 79% expressed feelings of stress, worry, or even distress as a result of this activity. Additionally, it was discovered that 74% of these individuals currently own a home. These findings reflect the growing trend among U.S. adults who increasingly rely on digital tools for their financial needs. Consequently, it emphasizes the importance for lenders and other service providers to adapt their approach and cater to consumers’ preferences for conducting business online.

Upon further examination, it was discovered that the primary motivation behind individuals comparing home prices is to utilize the gathered information as a benchmark to evaluate their own income and overall value (59%). Additionally, a significant portion (42%) engage in this activity to gain insight into their friends’ incomes. Moreover, 56% of respondents admitted that their online searches significantly or moderately influence their own decisions when it comes to purchasing a home.

Jeff Taylor, the Founder and Managing Director of Mphasis, emphasized that the 80% of Generation Z and millennials who experience stress from observing the home prices of their peers online should keep in mind that lenders do not assess borrowers based on comparisons with others when determining home loan eligibility. Instead, lenders evaluate the borrower’s individual profile, and it is often surprising how much borrowers can afford. Taylor further mentioned that despite the rise in interest rates in the Summer of 2023, reaching approximately 7%, numerous individuals still qualify to purchase homes with down payments as low as 5% even for homes with median prices.

The survey revealed that 74% of respondents see homeownership as part of the American Dream, while 87% believe it is currently too expensive to buy a home. Only 6% consider it an ideal time to enter the market. These results emphasize the importance of digital tools for evaluating prospects and suggest an opportunity for lenders to shift more services online.

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