Homebuying Boom Sparks Insecurities in New Homeowners, Revealing Limited Confidence in Household Maintenance and Financial Responsibilities

Hippo's 2021 Homeownership Report finds that while more than half of homebuyers felt very prepared before they purchased their home, one out of four found themselves less prepared than they thought

PALO ALTO, Calif.--(BUSINESS WIRE)--Hippo, the home insurance group that created a new standard of care and protection for homeowners, today announced findings from its 2021 Homeownership Report, a survey of U.S. homeowners that explored how confident homeowners are, and feel, about managing their homes.

The national survey of more than 1,000 homeowners found that first-time homeowners feel a significant lack of preparedness after purchasing their home. The findings reveal insights into the emotions and challenges that new homeowners faced over the past year, including many who rushed into home purchases to benefit from historically low interest rates. Home sales between July 2020 and June 2021 sat on the market for a median period of only one week before going under contract.* As homebuyers jumped in feet first, many faced unexpected repairs and surprises in their first year of homeownership that left them eager to prepare for the unexpected in 2022.

“Homeownership is an incredible first step into a new life chapter, but first-time buyers often don't take into consideration what's beyond the paperwork and moving process,” said Rick McCathron, President of Hippo. “At Hippo, we actively partner with our customers to help them proactively protect their homes through accessible services, smart home devices, and educational resources that prevent small issues from becoming big problems. Empowering homeowners with preventative tools paired with comprehensive home insurance coverage creates a more fulfilling homeownership experience.”

Hippo’s survey findings:

A new set of factors are influencing homebuying

The housing market continues to boom for people of all ages, single and those with partners, who are purchasing homes with a different set of standards.

• 87% of respondents agreed that the pandemic accelerated their decision to purchase a home. Furthermore, 67% paid over the asking price of their home.
• 8% of new homebuyers were single women, and in general single women were 300% more likely than average to enter the market by purchasing a condo.
• As competition increased, new buyers fronted more cash, as 36% made a down payment greater than 20%. Married respondents were 31% more likely than single individuals to put more cash upfront.
• First-time owners were 318% more likely than existing homeowners to say that climate change considerations factored into their homebuying decision.

New homeowner confidence is low, but they’re hungry to learn

New buyers recognize the importance of home maintenance but many are aware they don’t have the knowledge needed to combat unexpected costs.

• 77% experienced an unexpected issue that needed repair within the first year of owning their home, with 53% reporting repairs cost between $1,000 and $5,000 (comparatively, 13% had repairs over $5,000 and 34% had repairs under $1,000).
• New homeowners also saw areas of improvement in their properties, but lacked the knowledge necessary to complete them. For example, 68% of respondents noted that they wanted to improve their knowledge of home maintenance and repairs, including cadence and cost.
• According to the results, the areas new homeowners feel they can most improve are home maintenance and repair (68%), home security or protection (47%) and insurance/financial protection (38%).
• Even with unexpected issues, the majority of new homeowners are happy with their purchase and the lifestyle it has created for them and most (86%) don’t regret their home purchase.

Despite ups and downs of ownership, household goals are still top of mind

A desire for greater access to education and resources has homeowners shifting their attitudes towards home care.

• 42% of homeowners are setting New Year’s goals related to household improvements such as investing in indoor space (53%), home maintenance (51%), and outdoor space (49%).
• Homeowners are actively looking for advice with two thirds (66%) saying they would turn to social media or blogs for advice on homeownership.
  • 42% seek advice on homeownership from their therapist as well.
• 46% of those who are setting 2022 homeownership goals, said “increased community participation” and “entertaining at home” are among their aspirations for the new year.

Seasonal hazards often emerge to steal holiday joy

Homeowners may feel more confident about managing their households during the holidays with protective tools such as fire extinguishers, but they often forget to take precautions against some of the most common risks.

• 52% of homeowners who are decorating for the holiday season will put up a live tree, but only 16% say they will water it daily as recommended, which is a leading risk of house fires during the holiday season.
• 38% of respondents will use their fireplaces more often than usual, but only half (50%) will use protection around the fire and only 35% have a fire extinguisher handy.
  • To make things extra concerning, a full 25% of respondents are likely to keep a fire going overnight.
• 38% of respondents say that they have been the victims of package theft during the holiday season. Those in multi-family homes were 113% more than likely than average to have had their holiday packages stolen.

To ensure households can meet the demands of homeownership, proactive home care and maintenance is essential. While homeowners may feel overwhelmed from the amount of responsibility, having a partner to help identify risks proactively allows them to enjoy their homes to the fullest. Hippo offers eligible customers complimentary smart home device kits along with services such as Hippo Home Care, a home care concierge, as part of its commitment to helping homeowners protect and maintain their homes. With remote home check-ups done in conjunction with home care experts, Hippo Home Care helps homeowners do routine checks on the most critical systems around the house.

“The past two years have been a pivotal time for homeownership as homes became a central place for much of our daily lives, and we're eager to learn how homeowners are dealing with the changes,” said McCathron. “What we learned was truly inspirational. Home care is not only desired by homeowners, who are interested in improving their maintenance knowledge, they also want to resolve issues proactively. We will continue to learn from customer feedback and track homeowner trends to better partner with homeowners on their journey to bring joy into their homes.”

Methodology

The survey was conducted by Hippo among 1,000 nationally representative U.S. homeowners across 49 states, ages 25 through 75 between October 27 and October 31, 2021.

About Hippo

Hippo’s goal is to make homes safer and better protected so customers spend less time worrying about the burdens of homeownership and more time enjoying their homes and the life within. Harnessing real-time data, smart home technology, and a growing suite of home services, we are creating the first integrated home protection platform. Hippo is headquartered in Palo Alto, California with offices in Austin and Dallas, Texas and insurance products available to more than 80 percent of U.S. homeowners in 37 states. Hippo Insurance Services is a licensed property casualty insurance agent with commercial and personal lines products underwritten by various insurance companies. For more information, including licensing information, visit http://www.hippo.com.

Hippo Home Care is provided by YourHaus Inc., an affiliate of Hippo Insurance Services. YourHaus Inc. or its contractors would provide any and all services. Services are limited to speaking to a home care specialist, and do not include actual repairs or providing on site repairs or maintenance. Use of Hippo Home Care is subject to YourHaus Inc.’s terms of use and privacy policies. Hippo Insurance Services is not responsible for your use/non-use of Hippo Home Care. © Hippo Home Care 2021

*Statistic reported by The National Association of Realtors