It wasn’t that long ago—2021 and early 2022, to be exact—that homes in the United States were selling in weeks or even days instead of months. In 2022, even though 26 percent of U.S. adults were millennials, more than half of mortgage applications came from that age group, according to CoreLogic, representing a majority of first-time buyers.
The relative speed at which homes were sold during that period has also led to some substantial buyer’s remorse.
More than one-third (36 percent) were unsatisfied with their buying experience, and even more thought the process was more difficult than expected, according to a 2023 American Homebuyer Report in which 1,000 people in the United States who purchased homes in 2022 and 2023 were surveyed. With some homes selling for above the asking price, the speed at which some millennials grabbed new dwellings didn’t reflect future planning in some cases.
During that period, homebuyers found themselves in bidding wars, and many waived standard practices, such as home inspections, to take homes “as is.” Some now are having second thoughts about their decisions, with more than three-fourths of U.S. homeowners who purchased during that period expressing regret, according to a survey by the home insurance company Hippo.
“I’m still seeing a little remorse. I had a couple who bought a townhome, and they had a baby and a dog, and they didn’t think about how they’d be climbing three stories every day,” Lisa Briganti, realtor of Briganti Properties in Greenville, South Carolina, told The Epoch Times. “They’re suffering and miserable, but the owner is stuck with his low interest rate. Of course, they overpaid, but at least they’re not losing equity.”
But on the whole, with housing inventory still at historical lows in some areas and interest rates topping 7 percent showing no sign of going down any time soon, some of those pandemic-era buyers are settling for what they have.
“I just tell people to do what they need to do to be happy,” said Ms. Briganti, who has worked in the residential real estate industry for decades. “It’s really hard to convince people of that, and they’re staying in houses they don’t like. Every one out of five people I talk to thinks housing costs are going to drop, and they aren’t.”
Some of the remorse might be because 70 percent of the homebuyers between 2021 and 2022 were not only millennials but also first-time buyers.
According to the U.S. Census Bureau’s current population data, 2022 was the first time that more than half of millennials were homeowners, taking advantage of the low interest rates while also working remotely.
Home buying in 2024 presents fewer opportunities for first-timers. With less housing inventory available and prices still climbing, buying a home today is all but out of reach for that segment. While in 2020, the qualifying income needed was just $49,000. By 2023, the annual income needed for an average starter home climbed to more than $96,000, according to data from the National Association of Realtors (NAR). Some current estimates now list that income level as closer to $120,000.
The NAR states that affordability has long been an issue for first-time homebuyers because of limited savings and the need to finance 90 percent of the purchase, according to its 2023 Home Buyers and Sellers Generational Trends Report. However, the NAR also found that though there’s some buyer remorse for the rapid purchases of 2020–2022, many are still happy with their purchases.
“We found that 83 percent of younger millennials were happy with their purchase and only 14 percent unsure,” Brandi Snowden, the NAR’s director of member and consumer survey research, told The Epoch Times. “It was even higher for older millennials (87 percent).”
However, Ms. Briganti also says her clients, frustrated with the current economic climate, need to grasp realities that are likely to stay the same in the short term.
“What I say to those who are unhappy, the ones waiting on rates to come down and the housing market to crash is, it’s not going to happen,“ she said. ”Housing costs are still rising and it doesn’t make sense to wait for the rates to come down because you can always refinance later if they do.
“Housing prices keep increasing, so when you go to buy the same house next year, it’s going to be more money and it will end up being a wash.”
