Shifting Demographics Challenge New Hampshire’s Housing Market, Study Finds

Real estateResidents show less demand for homeownership, have housing affordability challenges

Changes in how the population views homeownership, a mismatch between existing housing and housing preferences, and obstacles to creating a balanced housing market may pose challenges for New Hampshire’s future, a study finds.

Housing Needs in New Hampshire, a three-part study commissioned by New Hampshire Housing and performed by the New Hampshire Center for Public Policy Studies and Applied Economic Research, examines factors that will influence New Hampshire’s future housing needs. The first part of the study, titled “Big Houses, Small Households: Perceptions, Preferences and Assessment,” concludes that the state’s current housing stock will not fit the evolving market demands and needs of the state’s population if no steps are taken to accommodate these changes.

New Hampshire’s senior population is expected to nearly double between 2010 and 2015, and they have a strong preference for staying in their current homes and aging in place. However, the character of their New England homes—large, rural, multi-level houses with narrow doors and stairs—will pose a challenge to making this possible. Rural locations will make the delivery of services that help seniors age in place more difficult, while the design of traditional New England homes exacerbate mobility challenges. Most homeowners also lost home equity during the Great Recession, limiting their ability, for now, to downsize.

In addition, the larger, rural homes built and purchased by Baby Boomer residents will appeal to a smaller number of young households. Nationally, members of Generation Y (also known as Millenials), show a preference for mixed-use communities and housing that fits with a more urban lifestyle. New Hampshire young professionals interviewed for Housing Needs in New Hampshire showed some interest in rural living, but are concerned about the availability of jobs in those areas and showed an overall wariness toward homeownership. With the highest average level of student debt in the country at $32,900 and little wage growth, New Hampshire young professionals said they are finding unique strategies, such as doubling up in rentals and leasing out portions of their home, to overcome the financial pinch they are experiencing.

Compounding the challenge of high student debt and stagnant wages are stricter lending requirements for mortgages. Homebuilders report that starter homes priced at around $179,000 still are not selling due to financing requirements that prevent first-time homebuyers from entering the market. This impact is felt especially by low to moderate income borrowers as they have fewer financial resources to manage these stricter lending requirements. This lack of financing options is pushing younger generations out of the ownership market. When this is coupled with Boomers staying in place rather than downsizing, the result is a housing market where fewer people are looking to buy.

New Hampshire residents, most of whom are homeowners, view housing affordability as the third most important priority when it comes to utilizing public funds, but obstacles still stand in the way of meeting the needs. Homebuilders report that excessive regulations and impact fees can often make building affordable apartments prohibitively expensive. Regional Planning Commissions report that town planners are still concerned about the impact multi-family housing may have on taxes and school systems. Also, public perception remains that a lack of affordable workforce housing is not a problem, despite high rents and low vacancy rates that cause some renters to pay well over 30 percent of their income toward housing costs.

“Housing Needs in New Hampshire provides a comprehensive picture of the status of the changing housing market needs and demographics in the State of New Hampshire,” said Dean J. Christon, Executive Director of New Hampshire Housing. “New Hampshire Housing and other public and private organizations will use the data collected through this study to better identify needs and establish priorities for housing and other programs.”

The second and third portions of Housing Needs in New Hampshire will be released in the coming weeks. The second portion examines the housing needs of the state’s rapidly growing senior population. The third portion will assess the current housing market and forecasts housing production needs for the next ten years. For more information about the study, visit

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