Most consumers agree when asked in surveys whether they support the idea of ​​building homes to help lower rents or generate more affordable purchasing choices. At the best of Fannie Mae To our knowledge, no well-known study has inquired about consumers’ support for building additional housing in their local communities, defined as being located within a few blocks or streets of their home.

Fannie Mae turned to the National Housing Survey for answers to this and many other questions. Consumers were specifically asked about their thoughts on increased zoning and housing density in their current communities, as well as the types of housing supply they are most likely to favor and the anticipated effects on real estate prices, rents and local taxes. The survey also examined the opinions of renters and homeowners on whether and how housing density should increase.

Report Highlights: National Housing Survey 2024

• Due to the sharp rise in real estate prices and mortgage interest rates, a much higher percentage of consumers today feel that it is more difficult to find affordable housing than when we initially raised the subject in 2017.
• The number of tenants in favor of building affordable housing in their local community is much higher than that of the owners. Additionally, the creation of denser housing types such as townhouses, apartments or condos is much more often supported by tenants than by owners.
• Fannie Mae found it particularly interesting that more than half of consumers think that if more housing is built in their neighborhood, house prices, rent prices and local taxes will increase. This goes against conventional economic theory that as supply increases, prices decrease.

Renters and landlords often strongly disagree about potential solutions, even if they agree on unaffordability

As expected, consumers are much more likely to believe it is difficult to get cheap housing today (69%) than they were in our 2017 survey (49%); nevertheless, the proportion for 2024 has been virtually constant since late 2021. Consumers have faced years of high house prices and rapidly rising mortgage rates since the outbreak, making the buying market extremely difficult housing.

Homeowners’ and renters’ opinions on the potential solution of increasing housing construction in their neighborhood to alleviate affordability concerns differ significantly. Although the majority of consumers (82%) in our survey support building more housing in their community, renters were much more likely to support building more “affordable” housing than homeowners (73% versus 44%). ).

Additionally, renters are much more likely to support the construction of other types of housing, such as townhouses, apartments or condos, than are homeowners, although both are inclined to support the construction of more large number of single-family homes in their neighborhood.

Another obvious point of contention between the two groups that comes up frequently at local government meetings is that nearly two-thirds of renters (63%) say they would support changes to local zoning codes or regulations to allow more development of housing, compared to only 37%. owners.

Many consumers do not think the new offer will make housing more affordable

Consumers are less convinced, even if the majority of economists agree that increasing the number of homes built will help slow the rise in prices, both for purchasing and renting. In fact, only 13% of respondents believe that if more housing were built in their community, home prices would decrease, while 59% believe they would increase. The fact that many people believe that the houses being built would not be within their means could be one reason for this disparity.

Further evidence of the perceived financial downsides of new construction comes from the fact that 61% of consumers believe council taxes would increase and 59% of consumers believe rental prices will increase as more homes are built.

The type of housing desired by consumers does not match what is available

About a third of consumers (31%) say they would purchase a home other than a single-family home if they were in the market, considering what is available and what they can currently afford.

However, we know that only 18% of the housing stock is made up of individual, non-single-family homes. Consumer demand for this specific housing type clearly appears to exceed supply, which we believe could have significant implications for homebuilders.

Diverse customer attitudes can make new development difficult

Policymakers and homebuilders may have difficulty agreeing on suggested advancements and reforms due to consumers’ conflicting views on housing affordability and construction. Although the majority of consumers do not support the development of the types of housing in their community that most experts believe would have the greatest positive influence on affordability, they do recognize the need to improve affordability.

However, survey participants believe more housing is a net good when considering the wider implications of new developments. The survey results also suggest a possible need for increased supply, indicating that pent-up demand from buyers for denser housing is greater than what is currently available in the housing stock.

To read the full report, including more data, charts and methodology, Click here.