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A survey of recent homebuyers and unsuccessful home-buying prospects found that a large share of the group will likely get a home-equity loan this year. Among the most likely prospects: millennial.
A thousand adults who purchased a home, or attempted to purchase a home, during the past three years were surveyed online by ServiceLink during January for its State of Homebuying Report. The survey was an attempt to identify year-over-year home buying trends.
According to the report, 44 percent of the respondents plan to take out a home-equity loan this year. Zeroing in on responses by generation, the share planning to get a second mortgage was 49 percent for millennials, 44 percent for Gen X, and 41 percent for Gen Z. Only 12 percent of baby boomers planned to extract equity through subordinate financing during 2023.
Another 11 percent of overall respondents indicated that they don’t know enough about home-equity loans to consider them.
Nearly three-quarters of overall homeowners planning a junior-lien transaction want the funds for home improvements, while a fifth desire to pay off debt, including student loans.
The report indicated that 21 percent of the respondents had more than $100,000 in home equity, and 41 percent had between $50,000 and $99,999 in equity.
“Our latest study suggests there are many homeowners and homebuyers who are ready to make their mark in the real estate market this year; whether it’s to purchase a new home or take out a home equity loan,” ServiceLink President of Origination Services Dave Steinmetz said in the statement. “This indicates there is an opportunity for lenders to provide more education and resources to buyers and homeowners to guide them throughout their homeownership journey.”
