Rising prices appear to be discouraging prospective buyers
Fewer prospective buyers tried to buy a home during the third quarter of 2021 compared to the previous quarter. The decrease reversed six quarters of steady gains, according to the Housing Trends Report from the National Association of Home Builders (NAHB).
The share of would-be buyers trying to find a home slipped to 57% in the third quarter, down from a peak of 61% that was reported for the second quarter of 2021.
NAHB's economics team, which produces the research, said the decline is an indication that fast-growing home prices have begun to discourage a segment of potential buyers from getting past the planning state.
The share of potential buyers who were actively searching dropped in three of the four Census regions between Q2 and Q3 of 2021. It was flat in the Midwest, holding steady at 50%.
Researchers found most buyers actively engaged in the purchase process were devoting considerable time searching for a home. Two-thirds (66%) reported spending three or more months looking during each the first three quarters of 2021, up from 57% in the last quarter of 2019 (pre-COVID).
The Housing Trends Report measures prospective home buyers' perceptions about the availability and affordability of for-sale homes in their markets. It is produced quarterly to track changes in perception over time.