Webinar: 2010 NAR Profile of Home Buyers and Sellers Highlights

2010 Profile of Home Buyers and Sellers
Jessica Lautz
December 9, 2010

Methodology
Survey conducted with recent home buyers who purchased a home between July 2009– June 2010
Seller information gathered from those home buyers who sold a home
Mailed 111,004 questionnaires
Received 8,449 responses
Response rate of 7.9%
Names obtained from Experian

Home Buyers

Who is buying today?
Typical buyer:
39-years-old
$72,200
58% married
20% single females
12% single males
8% unmarried couples
35% have children in home

Share of First-Time Buyers

Who is buying today? First-time Buyer: Repeat Buyer:
30-years-old
49-years-old
$59,900
$87,000
48% married
68% married
23% single females
17% single females
15% single males
9% single males
32% have children
37% have children

Why do buyers want to own today? All Buyers First-time Buyers Repeat Buyers Desire to own a home of my own 31% 53% 10% Desire for larger home 9 2 15 Change in family situation 8 7 10 Home buyer tax credit 8 13 3 Job-related relocation or move 7 2 12 Affordability of homes 6 8 4 Desire to be closer to family/friends/relatives 5 1 10 Desire for a home in a better area 5 2 7

What homes are being sold?
Typical home purchased:
85% of homes were previously owned
77% detached single family homes
Built in 1990
1,780 square feet
3 bedrooms/2 full baths
More than half of homes purchased were in the suburbs
Buyers typically moved 12 miles

Location, Location, Location
Quality of the neighborhood
Convenient to job
Overall affordability of homes
Convenient to friends and family
Quality of the school district
Convenient to shopping

Expected Tenure in Home

Importance of Commute Costs

Importance of Energy Efficiency

Senior-related housing Share who purchased a home in senior related housing (among buyers over 50) 11% Type of Home Purchased: Detached single-family home 51% Townhouse/row house 9 Apartment/condo in building with 5 or more units 13 Duplex/apartment/condo in 2 to 4 unit building 9 Other 17

The Search Process

First Step in Buying Process All Buyers AGE OF HOME BUYER 18-24 25-44 45-64 65 or older Looked online for properties for sale 36% 34% 40% 36% 21% Contacted a real estate agent 19 16 16 21 35 Looked online for information about the home buying process 11 16 13 8 4 Contacted a bank or mortgage lender 8 11 9 7 4 Drove-by homes/neighborhoods 7 4 5 10 12 Talked with a friend or relative about home buying process 7 13 8 4 6 Visited open houses 4 2 2 5 9

Frequency of Use of Different Information Sources

Usefulness of Information Sources

Length of the Search Process Number of Weeks Searched

Where Buyer Found Their Home

Satisfaction With Buying Process

Method of Home Purchase

What do buyers want from real estate professionals?

Benefits Buyers Had When Using an Agent All Buyers First-time Buyers Repeat Buyers Helped buyer understand the process 66% 80% 53% Pointed out unnoticed features/faults with property 53 55 50 Negotiated better sales contract terms 42 43 40 Improved buyer's knowledge of search areas 42 41 43 Provided a better list of service providers 41 41 42 Negotiated a better price 34 34 34

Referrals Matter
57% used an agent that was referred to them or they had worked with before
65% would definitely refer their agent or work with them again—22% probably would
64% of home buyers contacted only 1 agent during their search process

Financing the Home Purchase

Median Percent of Home Financed
91% of home buyers financed their home purchase
First-time buyers typically finance 96%
Repeat buyers typically finance 86%
Share of buyers who financed 100% of their home purchase dropped from 23% in 2008 to 14% of buyers in 2010

Sacrifices
Cut spending on luxury items
Cut spending on entertainment
Cut spending on clothes
Cancelled vacation plans

Home Buyer Tax Credit All Buyers First-time Buyers Repeat Buyers Used tax credit 71% 93% 48% Did not qualify for tax credit 27 6 49 Was not aware of tax credit 2 1 3

Housing a Good or Bad Financial Investment? All Buyers Good financial investment 85% Better than stocks 47 About as good as stocks 30 Not as good as stocks 9 Not a good financial investment 4 Don't know 11

Home Sellers

Who is selling today?
Typical seller:
46-years-old
$90,000
75% married
16% single females
6% single males
40% have children in home
Typically lived in their home for 8 years

Home Selling Situation

Why are sellers moving?
Home is too small
Job relocation
Want to move closer to friends or family
Neighborhood has become less desirable
Change in family situation (e.g., marriage, birth of a child, divorce)

Trade up or down?
55% purchased a more expensive home
51% purchased a larger home
57% purchased a new home

Selling Market Today
Sellers typically received 96% of their asking price for the home
57% of sellers reduced their asking price
44% offered incentives
Homes were typically on the market 8 weeks

Equity Earned in Home TENURE IN HOME All Sellers Dollar value Percent 1 year or less $37,626 17% 2 to 3 years $0 0% 4 to 5 years $6,000 3% 6 to 7 years $17,000 11% 8 to 10 years $35,000 26% 11 to 15 years $49,000 40% 16 to 20 years $79,100 78% 21 years or more $108,300 152% Median $33,000 24%

Satisfaction With Selling Process

Method Used to Sell Home

What do sellers want from their real estate professional?
Help price home competitively
Help find a buyer for home
Help seller market home to potential buyers
Help sell the home within specific timeframe

Method to Market Home All Homes Listing on the Internet 91% Yard sign 79 Open house 56 Print newspaper advertisement 28 Real estate magazine 25 Other Web sites with real estate listings 25 Direct mail (flyers, postcards, etc.) 16 Video 12 Social networking Web sites 5 Television 2 Video hosting Web sites (e.g., YouTube, etc.) 2 Other 5

Buyer Side: Use of Information Sources

Referrals Matter
64% used an agent that was referred to them or they had worked with before
63% would definitely refer their agent or work with them again an additional 21% probably would
66% of home sellers contacted only 1 agent during their search process

FSBO Sellers

FSBO Experience
Most cited reason for FSBO selling:
Did not want to pay a commission or fee (38%)
Sold to friend or relative (32%)
Most difficult tasks:
Getting the price right (23%)
Preparing or fixing up the home for sale (18%)

FSBO Selling Market All Sellers All FSBO Seller Knew Buyer Seller did not Know Buyer All Agent-assisted Agent-assisted only First FSBO, then Agent-assisted Median selling price $190,000 $140,000 $139,600 $155,700 $199,300 $200,000 $168,000 Median (sales price as a percent of asking price) 96% 100% 100% 97% 96% 96% 93% Percent who reduced asking price 57% 42% 23% 62% 59% 59% 62%

Where to Find Your Copy Via the “Right Tools, Right Now” webpage: http://www.realtor.org/prodser.nsf/RightTools/ResearchTools?OpenDocument

Webinar: 2010 NAR Profile of Home Buyers and Sellers Highlights

by NAR Research on Dec 09, 2010

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Webinar: 2010 NAR Profile of Home Buyers and Sellers Highlights — Presentation Transcript

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