03/19/2024 | Press release | Archived content
Mortgage rates are the talk of the town. From financial and housing experts speculating on market conditions to buyers and sellers contemplating their next move, people are watching mortgage rates and planning their moves accordingly. While rates today are not elevated beyond historical norms-4 million people still moved in the U.S. last year-they are high enough that some have stayed on the sidelines of this housing market.
The burning question is what will move those people off the sidelines. Do we need to wait for 3% rates again for buyers and sellers to re-engage? Baby Boomers currently occupy a whopping 32 million homes in the U.S. What will it take for the Silver Tsunami to make a move? Could it be politics or the calendar, not mortgage rates, that cause them to start packing?
We asked these questions and more in two new surveys of 2,092 adults over age 18, and 1,020 Baby Boomers who are interested in moving in the next five years. Here is what we found.
Baby Boomers: mortgage rate-agnostic and politically influenced
Homes owned by Boomers considering a transition are typically seen as a way to help alleviate the persistent undersupply of U.S. housing. Boomers own almost 10 million homes and are at an age when they are likely to downsize or consider a lifestyle change.
Our survey found that when they sell their current home, 74% will downsize their living space by about 25%. Further, the vast majority (85%) of Boomers plan to sell their homes in the next three years - and that will likely hold true regardless of interest rate movement.
58% of Boomers say that a lower mortgage rate (around 5%) would not alter their selling timeline.
A minority (18%) say a 5% rate would accelerate their plans to sell, whereas about 12% say it would slow their selling plans.
While the fluctuation of mortgage rates may not sway Boomer homeowners, seasonality still matters. The spring selling season continues to dominate as the time of year when most plan to list their homes:
Spring (March to May): 43%
Summer (June to August): 20%
Fall (September to November): 8%
Winter (December to February): 2%
If not rates, what is motivating Boomers to sell?
52% said they wouldn't move if they can't find a suitable replacement residence
46% noted they would wait for a more favorable market or higher home value
45% said they would wait if they didn't receive adequate offers
When Boomers do decide to sell, they have priorities, their top five being:
Getting the highest price (80%)
Selling quickly (55%)
Not having to do repairs (49%)
Not haggling with buyers (34%)
Simplicity of the sale (30%)
In the lead-up to the presidential election this fall, politics are also playing a role in how Boomers are looking at their moves. About half (49%) of respondents say that the results of the 2024 U.S. presidential election will be "somewhat to extremely influential" in their decision to move in the next five years.
Politics aside, however, it's clear that if Boomers are ready to sell and they find their next home, they will make that move.
Everyone else: mortgage rates matter
Today's 30-year fixed rate mortgage of around 7%, while not that high historically, has been high enough to keep many people out of the market, especially those who are younger than Boomers. Our survey found that younger buyers and sellers are much more motivated to make a move if the mortgage rate drops.
50% of Americans say an interest rate of 6.5% or less would prompt them to look at buying a home, and 29% say a rate of 4% or less would make them look
46% of renters prefer to wait until the rate is 5% or lower
Our survey also found that as age increases, the impact of rates on moving decisions decreases.
18-34 y/o: 82% say that rates would have an impact on their interest in buying a home
35-44 y/o: 78%
65+ y/o: 42%
Buying and selling a home is always a personal matter, with many factors that go into this big decision. But it's clear that for many, affordability will continue to be a major consideration in the near and long-term.
Amit Arora is the VP of Pricing at Opendoor
Harris Poll Survey Methodology:This survey was conducted online within the United States by The Harris Poll on behalf of Opendoor from February 15-20, 2024 among 2,092 adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level.
Baby Boomer Survey Methodology:The survey was conducted online by Strategence in January 2024 among 1,020 nationally representative respondents born between 1946 and 1964 looking to sell their home within the next five years.