Despite the red-hot real estate market, more Americans are regretting their home purchases, per a new Trulia survey.
It’s a bit odd because home prices have been rocketing higher throughout much of the nation since they bottomed in 2012.
So even if you absolutely hated your home, you’d think all that equity would be enough to keep you happy. But that’s seemingly not the case.
More Regrets Since Housing Bottomed
For whatever reason, recent home buyers are more regretful than those who purchased homes prior to 2012. If you look at a chart of home prices before and after 2012, you’d probably be scratching your head.
Somewhat amazingly, half of those who found their homes after the housing market bottomed in 2012 said they had regrets, compared to just 42% who found their home before 2012.
Trulia pointed out one distinction between the two groups – feeling financially secure. Some 12% of recent buyers said they wished they had been more secure before buying a home, compared to 6% of the pre-2012 buyers.
But that doesn’t do it for me. There has to be something else because anyone who didn’t have to go through the housing crisis and/or deal with negative equity shouldn’t feel worse than those who did.
The Housing Market Has Become Rushed
I believe the housing market has gotten out of whack. Sure, home prices have recovered and are now hitting new nominal (but not real) highs in many areas of the country.
But there’s this strange sense of dissatisfaction. It’s as if everyone is looking around and feeling unfulfilled, even though they got a home for a relatively low price (and have a super low fixed mortgage rate).
It’s almost like an easy come, easy go feeling, coupled with entitlement and wrapped in disappointment.
Like they should have bought the million-dollar home instead of the $500,000 home in hindsight, or they should have purchased two homes when they had the chance.
In that regard, it feels speculative, like it once did before 2012. Just in a different kind of way, this time fueled by a lack of inventory instead of an abundance of risky financing options.
That lack of inventory could be exactly the problem. Many of today’s recent homeowners probably had to make quick decisions because of the few homes for sale in their desired market. They may also have had to offer more than they felt comfortable offering to win a bidding war.
As such, there probably are a lot of regrets because they either settled, felt rushed, “overpaid,” or didn’t do their diligence before signing on the dotted line.
If you think about it, even back in 2012 there wasn’t much available, homes were just a lot cheaper. It was still slim pickings out there. So there was probably a lot of settling going on.
And as noted, prices were considerably lower, so those who look back probably wished they had bought the bigger home, or the home with the pool, or what have you.
Most People Kept Their Homes Through the Crisis
The answer may also lie in the fact that pre-2012 homeowners went through some really bad times and are now enjoying really good times.
And guess what? Despite the harrowing headlines, 93% of homeowners who bought their home before 2012 kept it.
And 82% of these pre-bottom buyers said they were glad they didn’t sell in the past five years.
Meanwhile, just 72% of post-2012 buyers said they hadn’t sold in the past five years, and only 60% indicated they were glad they didn’t.
Today’s recent home buyer hasn’t gone through any ups and downs – just ups and lots of them, even if they didn’t get the exact house they wanted.
Sometimes that lack of perspective makes one less appreciative of what they have.
The good news is that all home buyers seem happier than renters. The top regret among renters continues to be the decision to rent instead of buy. So there you have it.
Maybe no one’s happy.