A new study has found that consumers are willing to make significant compromises to purchase a home, even sacrificing the money they put into retirement savings.
According to the survey of more than 1,000 consumers considering a home purchase in 2017, consumers see homeownership as a priority, yet most are concerned about affordability, including 69 percent who cite their top financial fear is not having enough cash for the down payment. To reach their goal, respondents were prepared to forgo other financial goals and investments. When asked about their willingness to sacrifice several savings goals, most consumers indicated that saving for a home takes priority over saving for an emergency (61 percent) or contributing to their retirement (60 percent). An even larger group (72 percent) would limit their contributions to other investment funds to save for a home.
In addition to compromising their financial safety nets, the study, commissioned by online brokerage firm Owners.com, showed that consumers are open to purchasing a house that may not meet all their requirements if it means they will get into a home this year. With rising home prices, consumers were asked to choose the areas where they would look to save to stay on budget. More than half (51 percent) would consider buying a fixer-upper, while more than one-third (36 percent) would purchase a smaller home than what they desire. Additionally, consumers also indicated they would undertake some of the transaction work themselves to save on traditionally high agent commissions, with more than one-quarter (28 percent) seeking opportunities to save in this fashion. These buyers may want to consider brokerage models that offer a rebate on agent commission costs.
