The National Association of Realtors recently reported that existing U.S. home sales totaled 4.09 million last year, an 18.7% decline from 2022 and the lowest full-year level since 1995.
One factor driving the decline is a shortage of homes for sale – there were 1 million homes on the market at the end of December compared to the historical average of 2.5 million. According to a Redfin analysis of data from the Federal Housing Finance Agency’s National Mortgage Database, more than 88% of homeowners with mortgages have an interest rate below 6%, and 59% have a rate below 4%. With the 30-year fixed mortgage rate in the mid-6% range, many homeowners are reluctant to sell.
Home sales are a big driver of home improvement spending, with 25% of respondents saying they will invest $5,000 or more to get their homes ready for sale. Looking beyond home sales, brands and retailers can encourage homeowners to do more routine maintenance on a more regular basis and demonstrate ways in which they can help them tackle their minor home repairs.
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To get additional insight into what this means for brands and retailers, read the entire study.