With inflation rising to its highest level in nearly 40 years, three-quarters of buyers and sellers say they are changing their plans, according to a new consumer survey of 1,500 aspiring buyers and sellers conducted by Redfin.
Twenty-nine percent of survey respondents say they are delaying buying a home due to inflation. On the other hand, about a quarter of aspiring buyers say that inflation is prompting them to accelerate plans to make a purchase in real estate, the survey shows. Ten percent of respondents say that inflation is prompting them to move up their homeselling plans, 7% are delaying selling, and 3% are nixing the idea of selling.
“The way Americans interpret news about rising prices can have a variety of effects on their financial decisions, including homebuying,” says Daryl Fairweather, Redfin’s chief economist. “Some people may delay buying because they’re worried that with prices rising on everything from food to fuel, now is not the right time to make a huge purchase. But others might move faster to find a house because they’re worried home prices and rent prices will increase even more, and they want to lock in a fixed payment.”
Inflation prompted consumer prices to jump 6.8% in November compared to a year earlier. Consumers are seeing higher prices on groceries, gas, energy, and more.
Seventy-three percent of survey respondents say that higher gas prices are affecting their decisions about purchasing a home that would require a longer commute to their job. Also, 21% say that inflation has made them want to buy a cheaper home.
Rising costs of home energy are affecting real estate decisions as well. Thirty-six percent of respondents say they plan to add energy-saving features to their homes. Thirty-three percent plan to move to an energy-efficient home, and 15% intend to move to a smaller home, the survey finds.