Summer Webinar Series: Home Buyer and Seller Generational Trends

Jessica Lautz July 16, 2013

Home Buyer and Seller Generational Trends

Survey conducted with recent home buyers who purchased a home between July 2011 June 2012 Seller information gathered from those home buyers who sold a home Mailed 93,502 questionnaires Received 8,501 responses Response rate of 9.1% Names obtained from Experian

Home Buyers and What They Bought

Age of Home Buyers

Adult Composition of Buyers

Composition Married Couple 32 and Younger 63% 33 to 47 71% 48 to 57 61% 58 to 66 65% 67 to 87 63% 88 and Older 48%

Single Female
Single Male Unmarried Couple Other

12
10 14 1

14
6 8 1

20
10 6 3

19
10 4 3

20
10 4 2

22
26 4 *

Number of Children Under the Age of 18 Residing in Household

32 and 33 to 47 Younger None One Two Three or More 55% 24 15 6 30% 23 31 15 48 to 57 70% 18 8 5 58 to 66 91% 6 2 2 67 to 87 97% 2 * 1 88 and Older 74% 4 9 13

Household Income of Home Buyers

$100,000 $80,000 $66,200 $60,000 $40,000 $20,000 $0 $37,000 $93,100 $93,400 $76,200 $61,800

Median Income
32 and Younger 33 to 47 48 to 57 58 to 66 67 to 87 88 and older

First-Time Home Buyers in Age Group

Primary Reasons for Buying a Home

32 and Younger Desire to own a Home of My Own Desire for Larger Home Job-related Relocation Change in Family Situation Desire to be Closer to Family 50% 9 6 10 1 33 to 47 32% 17 13 7 3 48 to 57 21% 9 13 9 4 58 to 66 14% 7 8 9 13 67 to 87 7% 6 * 5 24 88 and Older * 4 9 * 39

Characteristics of Home Purchased

32 and Younger Previously Owned Detached Single Family Median Price 85% 80 33 to 47 84% 85 48 to 57 84% 80 58 to 66 82% 76 67 to 87 82% 68 88 and Older 83% 61

$165,000

$235,000 $200,000 $185,000 168,000

191,000

Median Square Foot

Median Year Built

1,700

2,100

2,000

1,800

1,750

1,500

1986

1991

1993

1995

1997

1991

Senior Related Housing

Quality of the neighborhood Convenient to job Overall affordability of homes Convenient to friends/family Design of neighborhood Convenient to shopping Quality of school district

Neighborhood Choice
32 and Younger Quality of the Neighborhood Convenient to Job Overall Affordability of Homes 68% 62 48 33 to 47 65% 48 37 48 to 57 55% 43 35 58 to 66 56% 25 38 67 to 87 52% 4 27 88 and Older 30% * 32

Convenient to Friends/Family
Convenient to Schools

44
29

29
36

28
15

37
4

45
3

46
*

Environmentally Friendly Features Considered Very Important

Expected Length of Tenure in Home Purchased

35
30 25 20 15 30

20

20

20
15

10
5 0

10

Median 32 and Younger 58 to 66 33 to 47 67 to 87 48 to 57 88 and Older

Search Process

First Step Taken During Home Buying Process

32 and Younger Looked Online for Properties Contacted a Real Estate Agent Drove-By homes Visited Open Houses Looked in Newspapers, Magazines, Home Buyers Guide 42% 14 5 2 1 33 to 47 46% 15 8 3 1 48 to 57 47% 18 8 4 2 58 to 66 38% 25 10 4 1 67 to 87 29% 28 13 6 3 88 and Older 23% 18 23 * 23

Information Sources Used in Home Search

32 and Younger
Internet Real Estate Agent 96% 87

33 to 47
96% 87

48 to 57
89% 86

58 to 66
85% 90

67 to 87
66% 89

88 and Older
44% 91

Yard Sign Open house

Print Home Advertisement

47 40
22

55 50
25

54 44
31

53 45
35

53 38
34

33 67
21

Where the Buyer Found the Home they Purchased

32 and Younger Internet Real Estate Agent Yard Sign/Open house Friend/Relative 49% 32 8 6 33 to 47 47% 31 9 5 48 to 57 44% 32 11 6 58 to 66 32% 41 11 6 67 to 87 23% 41 13 11 88 and older 21% 29 17 33

Home Builder or Their Agent

Actions Taken as a Result of Internet Home Search

Younger buyers are more likely to: -Drive the home or view the home -Request more information -Be pre-qualified for a mortgage online -Look for more info on how to get a mortgage and general home buyer tips.

Satisfaction in Buying Process

Benefits Provided by Real Estate Agent During Home Purchase

32 and Younger Helped Buyer Understand 76% the Process Provided a Better List of Service Providers Negotiated Better Sales Contract Terms Negotiated a Better Price Shortened Buyers Home Search 46 48 37 30 33 to 47 59% 45 44 36 26 48 to 57 50% 39 40 32 24 58 to 66 54% 39 38 35 30 67 to 87 43% 42 33 34 34 88 and Older 35% 24 40 30 20

Home Buyer Found Real Estate Agent

32 and Younger Referred by Friend, Neighbor, or Relative 50% 33 to 47 43% 48 to 57 30% 58 to 66 31% 67 to 87 28% 88 and Older 45%

Internet Web Site

Used Agent Previously to Buy/Sell a Home Saw Contact Info on For Sale/ Open House Sign Mobile or Tablet Application

11
4 6

9
11 6

13
14 7

11
14 7

9
16 7

*
* 5

15

Most Important Factors when Choosing an Agent

32 and Younger Agent is Honest and Trustworthy Reputation of Agent Agent is a Friend or Family Member 29% 20 17 33 to 47 27% 21 15 48 to 57 21% 22 13 58 to 66 18% 21 14 67 to 87 18% 23 14 88 and Older 30% 15 35

Would Buyer use Real Estate Agent Again or Recommend to Others

Financing the Home Purchase

Percent of Home Financed

100% 90% 95%

92%

88% 82% 78% 79%

80% 70%
60% 50% 40% 30% 20% 10% 0%

Median Percent Financed 32 and Younger 58 to 66 33 to 47 67 to 87 48 to 57 88 and Older

Sources of Down Payment

32 and Younger Savings 80% Proceeds from Sale of 7 Primary Residence Gift from Relative or Friend 401k/ Pension Fund Including Loan Sale of Stocks or Bonds 27 8 7 33 to 47 71% 24 48 to 57 54% 31 58 to 66 50% 40 67 to 87 44% 51 88 and Older 62% 45

15 13 8

7 12 9

3 7 7

2 2 12

10 * *

Sacrifices Made to Purchase Home

Difficulty of Mortgage Application and Approval Process

Buyers View of Homes as a Financial Investment

Home Sellers and What They Sold

Age of Home Sellers

Characteristics of Home Sellers

32 and Younger
Median Income First-time Seller $97,700

33 to 47
$115,400

48 to 57
$114,000

58 to 66
$82,200

67 to 87 88 and Older
$62,600 $32,000

84%

46%

26%

21%

18%

50%

Adult Composition of Home Seller Households

32 and Younger
Married Couple Single Female Single Male Other 91% 4 3 *

33 to 47
86% 7 3 4 *

48 to 57
70% 17 7 5 2

58 to 66
70% 18 7 3 2

67 to 87
67% 20 7 4 2

88 and older
* 29 71 * *

Unmarried Couple 2

Number of Children Under the Age of 18 Residing in Home Seller Household

32 and Younger Percent that have Children Under 18 Residing in Household 71% 33 to 47 81% 48 to 57 29% 58 to 66 6% 67 to 87 4% 88 and Older *

Proximity of Home Sold to Home Purchased

Size of Home Purchased Compared to Home Recently Sold

Price of Home Purchased Compared to Home Recently Sold

Primary Reason for Selling Previous Home

32 and Younger Job Relocation Home is too Small Want to Move Closer to Friends/Family Neighborhood has Become Less Desirable Change in Family Situation 26% 37 5 11 10 33 to 47 27% 29 4 14 6 48 to 57 18% 10 6 10 14 58 to 66 11% 5 20 11 9 67 to 87 * 6 30 6 6 88 and Older * * 29 57 *

Tenure in Previous Home

45 40 35 30 25 20 42

15
10 5 0 8 5

11

13

15

Median 32 and Younger 58 to 66 33 to 47 67 to 87 48 to 57 88 and Older

Satisfaction with the Selling Process

Method Used to Find Real Estate Agent

32 and Younger Referred by Friend/Neighbor/Relative Used Agent Previously to Buy or Sell a Home Personal Contact by Agent 34% 25 3 33 to 47 40% 22 4 8 3 48 to 57 38% 26 4 4 4 58 to 66 37% 21 6 3 5 67 to 87 36% 22 7 * 4 88 and Older 43% * * * *

Referred through Employer 6 or Relocation Company Saw Contact info on For Sale/ Open House Sign 6

Did Seller Use the Same Real Estate Agent for Their Purchase?

Level of Service Provided by the Real Estate Agent

Would Seller Use Real Estate Agent Again or Recommend to Others

Next up on the Summer Webinar Series

July 23rd: 2013 Home Features Survey July 30th: 2013 Commercial Member Profile, and 2013 Member Profile August 6th: 2013 Investment and Vacation Home Buyer Survey

Where to find NAR Research

Jessica Lautz: jlautz@realtors.org, 202-383-1155 NAR Research www.realtor.org/research-and-statistics Economists Outlook Blog: economistsoutlook.blogs.realtor.org FaceBook: facebook.com/narresearchgroup Twitter: twitter.com/NAR_Research