82% of recent homebuyers regret their purchase, study finds

The housing affordability crisis has made it much harder for ordinary Americans to afford a home, but even those who recently purchased one are struggling to make ends meet.

According to a recent study by Clever Real Estate, a whopping 82% of Americans who purchased a home in 2023 or 2024 have at least one regret about doing so.

The biggest regret is spending too much.

The study found that 43% of recent homebuyers said they’ve struggled to make their mortgage payment on time, and 44% have taken on additional debt to maintain their lifestyle.

To put it in perspective, a buyer who took out a 6% mortgage on a $420,000 home is on the hook for $2,333 in monthly payments, assuming a 20% down payment and 30-year mortgage term.

But even a 6% mortgage payment is considered relatively low these days. As Creditnews recently reported, the average mortgage rate was 7.05% last week.

At that level, the average monthly mortgage payment swells to $2,560 for the same loan.

That’s probably why 31% of homebuyers in the Clever Real Estate survey said purchasing a home was harder than they expected due to financial reasons. Part of that stems from spending too much on their home in the first place.

More than a third (37%) of respondents said they bought a home that was more expensive than they initially budgeted for.

Housing costs remain elevated

Unfortunately, the threat of biting off more than they can chew is something homebuyers should expect for the foreseeable future.

According to Redfin data, the median U.S. home sale price increased by 6.2% to $433,558 compared to a year earlier. It marked the first new all-time high since 2022 when the housing market was on fire.

“Today’s housing market is much slower than it was during the pandemic homebuying boom, but prices continue climbing because there still aren’t enough homes to go around,” Redfin’s data analyst, Lily Katz, said in a report.

Meanwhile, the Case-Shiller Index showed that real estate prices also hit record highs in the 20 largest U.S. metros, climbing 7.4% year over year.

The combination of elevated mortgage rates and rising property values means “many potential buyers have been priced out of the market,” said Matthew Walsh, a housing economist at Moody’s Analytics.

According to Keith Gumbinger, vice president of mortgage company HSH.com, home prices will only begin to moderate once inventories increase and mortgage rates decline.

By his estimates, mortgage rates have to fall to around 4-5% for the market to return to its pre-pandemic norm. In Gumbinger’s view, it could be a long time before that happens.