A thousand people took part in At Fannie Mae’s third quarter 2021 National Housing Survey and reported that affordability and remote working are still very important to members of all demographic and age groups.
The survey was conducted by Fannie Mae’s Economic and Strategic Research Group with the help of ReconMR and Dynata, which made the phone calls to households due to coronavirus closures at their call centers. The sample size of 1,000 people was selected and weighted to represent the economic and racial composition of the general population as a whole.
When asked what they thought of housing affordability and the impact of remote work on how they viewed housing, Fannie Mae found that an additional 20% of respondents thought affordability housing had declined, and affordable homes in general were more difficult to find. .
Editor’s note: The questions asked in this version of the National Housing Survey are not found in all quarterly surveys. The last time these questions were asked of respondents was in the fourth quarter of 2017, which explains the discrepancy in the dataset.
“Interestingly, most survey respondents believe their own current housing is affordable, a belief that has not changed since 2017,” the survey says. “However, in 2021, we saw a dramatic increase in the percentage of consumers who felt housing in their area had become both less affordable and harder to find. In 2017, 45% of homeowners said affordable housing in their area was hard to find, a number that jumped to 69% in 2021.
Fannie Mae believes this is due to ongoing inventory constraints; If people who see their housing as affordable and are in an otherwise unaffordable area, they may choose not to move – this is true for landlords or tenants.
However, 92% of homeowners said they felt their mortgage was still affordable in today’s housing market.
How Remote Work and Travel Impact Housing Preferences
More than a third of respondents expected to work from home at least some of the time, while nearly half said they would need to physically travel to their place of work every day. Digging deeper, a higher percentage of owners than renters reported being able to work remotely (40% of owners versus 31% of renters). Additionally, a higher percentage of high-income respondents said they expected to have some type of remote work situation.
When asked if working remotely would impact their willingness to live further in a hybrid work situation, more renters said they would be willing to do so compared to landlords and 13% additional would be willing to move completely to another region.
Fannie Mae explains in her report that tenants working remotely are more willing to move than landlords because the physical act of moving is generally easier: they can move out at the end of their lease, while landlords would have to sell their house – usually much more. longer and much more complicated process. The data also showed that low-income respondents working remotely are more willing to travel longer distances than other higher-income respondents, likely because they can find cheaper accommodation farther from job centers. .
Reasons to move and buy
The survey also asked respondents who were planning to move in the next 12 months and the reasons why they expected to move.
While homeowners said they plan to move because of a new job or family (59%), renters overwhelmingly say they plan to move for one reason: increases rent (33%).
“These potential short-term buyers were also asked if working remotely had an impact on their desired home features,” the survey says. “Unsurprisingly, given the changing work paradigm, as well as behavioral changes likely resulting from the pandemic, 38% of all respondents said they wanted more outdoor/yard space, while 27% said they wanted to live further away from neighbours. Tenants, in particular, wanted more outdoor space, while current owners said living closer to family and friends was a priority.
Continued demand for all types of more affordable homes
“Clearly, consumers have become much more aware of the lack of housing affordability, and the continued flexibility of remote working is likely giving many the opportunity to live further away in more affordable areas,” the survey concluded. . “Consumers looking to buy in the next year indicate that work/personal lifestyle – or rising rental prices, for those renting – are their main reasons for moving, and many indicated that they wanted more outdoor space and privacy.”
“For us, this information suggests that if more houses or rental properties became available in slightly less dense areas, it would probably be a welcome relief for many households. But with single-family home prices expected to rise 7.6% in 2022, as measured by the FHFA Purchase-Only Index, after rising 17.6% in 2021, current and potential homeowners could continue to have difficulties in buying a house.