-- A majority of US homeowners prefer upgrading their existing places instead of relocating to a new one as high mortgage rates and home prices have hit affordability, a survey by Redfin showed Friday.
Roughly 43% of Americans renovated their home in the past year, while another 33% intend to renovate in the next 12 months. Some 65% who recently made renovations opted for upgrades rather than relocating. For those planning to renovate in the next year, 71% said they're remodeling instead of purchasing a new place, according to the survey.
Redfin said the survey was fielded by Ipsos in November to 4,000 residents in the US.
"Homeowners are staying put because it is expensive to move," the online real estate brokerage said. "With high mortgage rates and home prices, moving isn't an affordable option for many Americans -- especially when about 80% of homeowners with a mortgage have an interest rate below current levels."
In the week through Thursday, the average 30-year fixed mortgage rate retreated to 6.3% from a six-month high two weeks earlier, Redfin said in a recent report, citing Freddie Mac data. In the four weeks ended Sunday, the median US home-sale price was at $393,059, up 2.3% year over year and the biggest increase in a year, according to that report.
A shortage of desirable, move-in ready homes for sale, especially those that are spacious enough for a family, is another factor behind people deciding to stay put, according to Redfin.
"Many Americans are choosing to stay put and make the home they already have work for them," Redfin Head of Economics Research Chen Zhao said. "That could mean improving outdated spaces, adding space for a growing family or reconfiguring the existing space so it works for everyone."
Approximately 23% of people who renovated their home in the past year spent $10,000 to $20,000 on improvements, according to the report.