THE TRUTH

ABOUT
HOMEOWNERS
WHY THEYRE
NOT SELLING

Presented by
Carmen Hirciag
Senior Research Analyst

SALES OF EXISTING DETACHED HOMES

California, May 2015 Sales: 423,360 Units, +5.1%YTD, +8.9%YTY
700,000
600,000
May-14: May-15:
388,690 423,360

500,000
400,000
300,000
200,000
100,000

SERIES: Sales of Existing Single Family Homes

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

Jan-15

Jul-14

Jan-14

Jul-13

Jan-13

Jul-12

Jan-12

Jul-11

Jan-11

Jul-10

Jan-10

Jul-09

Jan-09

Jul-08

Jan-08

Jul-07

Jan-07

Jul-06

Jan-06

Jul-05

Jan-05

*Sales are seasonally adjusted and annualized

CALIFORNIA SALES
Year-over-Year % Chg

6 per. Mov. Avg. (Year-over-Year % Chg)

140%
120%
100%
80%
60%
40%
20%
0%
-20%
-40%

SERIES: Sales of Existing Single Family Homes, Not Seasonally Adjusted

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

Mar-15

Aug-14

Jan-14

Jun-13

Nov-12

Apr-12

Sep-11

Feb-11

Jul-10

Dec-09

May-09

Oct-08

Mar-08

Aug-07

Jan-07

Jun-06

Nov-05

Apr-05

Sep-04

Feb-04

Jul-03

Dec-02

May-02

Oct-01

Mar-01

Aug-00

Jan-00

-60%

CHANGE IN SALES BY PRICE RANGE

(Year-to-Year)

May-15

25%

21.1%

20%
15%
7.9%

10%
5%

7.4%
4.0%

0%
-5%
-10%
-15%

-14.1%

-20%

SERIES: Sales of Existing Detached Homes

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

8.8%

11.6%

14.9%

SALES BY REGION(EXISTING SFH)

Bay Area
20%
15%
10%
5%
0%
-5%
-10%
-15%
-20%
-25%

SERIES: Sales, Not Seasonally Adjusted

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

Central Valley

So CA

INVENTORY DROPPED SLIGHTLY FROM LASTYEAR

May 2014: 3.7Months; May 2015: 3.5 Months
18
16
14
12
10
8
6
4

Note: Unsold Inventory Index represents the number of months it would take to sell the remaining inventory for the month in question. The
remaining inventory for the month is defined as the number of properties that were Active, Pending, and Contingent (when available) and
divide the sum by the number of Sold properties for the month in question.

SERIES: Unsold Inventory Index of Existing Single Family Homes

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

Jan-15

Jul-14

Jan-14

Jul-13

Jan-13

Jul-12

Jan-12

Jul-11

Jan-11

Jul-10

Jan-10

Jul-09

Jan-

Jul-08

Jan-

Jul-07

Jan-07

Jul-06

Jul-05

Jan-05

Jan-

INVENTORY DROPPED SIGNIFICANTLY

IN THE BAY AREA SINCE 2009
BUT REMAINED TIGHT
9.0

Bay Area

Central Valley

So CA

8.0
7.0
6.0
5.0
3.8
3.5

4.0
3.0

2.2

2.0
1.0
0.0

Jan-09

Jul-09

Jan-10

Jul-10

Jan-11

Jul-11

Jan-12

Jul-12

Jan-13

Jul-13

Jan-14

Jul-14

Jan-15

Note: Unsold Inventory Index represents the number of months it would take to sell the remaining inventory for the month in question. The
remaining inventory for the month is defined as the number of properties that were Active, Pending, and Contingent (when available) and
divide the sum by the number of Sold properties for the month in question.

SERIES: Unsold Inventory Index of Existing Single Family Homes

SOURCE: CALIFORNIA ASSOCIATION OF REALTORS

2015 HOMEOWNER SURVEY

About the Home

MAJORITY BOUGHT HOME WITHIN THE PAST 15

YEARS
30.0%

26%

25.0%
20%

20.0%

14%

15.0%
11%

10.0%
5.0%

6.7%
2.3%

0.0%

Q. In which year did you buy your home?

3.2%

5.3% 4.8% 5.2%

1.4%

MAJORITY HOMES IN SOCAL

Northern CA
20%

Southern CA
58%

Q. In which CA County is the home located?

Other CA 22%

MOST HOMES ARE SINGLE FAMILY

Condo /
townhome 11%

Other 4.1%

Single family
85%

Q. What type of home is it?

NEARLY HOMES ARE LOCATED IN THE

SUBURBS
Suburban

49%

Urban

24%

Urban adjacent

16%

Rural
Other

11%
0.7%
0%

10%

20%

30%

Q. Please select the option below that best describes the location of the home.

40%

50%

60%

THOSE WHO BOUGHT WITHIN THE PAST 15YEARS ARE

MORE LIKELY TO LIVE IN URBAN AREAS
< 15 years

15 years+

All owners
46%

Suburban

53%
49%
29%

Urban

17%
24%
14%

Urban adjacent

18%
16%
0%

10%

20%

30%

Q. Please select the option below that best describes the location of the home.

40%

50%

60%

MEDIAN PURCHASE PRICE: $265,000

35%

35%

30%
25%
20%

20%

15%

15%
11%

11%

10%
5%
0%

Q. What was the purchase price of the home?

3%

5%

MEDIAN PURCHASE PRICE IS TWICE AS HIGH FOR

MORE RECENT OWNERS
$350,000
$350,000
$300,000

$265,000

$250,000
$162,000

$200,000
$150,000
$100,000
$50,000
$0
All owners
Q. What was the purchase price of the home?

15 years+

< 15 years

MEDIAN HOME VALUE SLIGHTLY HIGHER FOR

THOSE WHOVE OWNED LONGER
$450,000

$425,000

$450,000
$400,000

$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
All owners
Q. What is the current value of your home?

15 years+

< 15 years

2/3 HOMEOWNERS CONDUCTED RESEARCH ON

HOME VALUE
No research

31%

Zillow

31%
23%

Realtor.com
19%

Agent comps

18%

Appraisal
5.9%

Other websites

4.3%

Other research
0%

5%

10%

15%

20%

Q. Have you conducted any research to make this appraisal? Please select all that apply.

25%

30%

35%

 HOMEOWNERS HAVE $100K OR MORE EQUITY

25%
20%
20%

17%

16%

15%

15%
10%

12%
10%

5%
0%

Q. Approximately how much equity do you have in your home?

9%

THOSE WHOVE OWNED 15+YEARS HAVE MORE

EQUITY
$300,000
$300,000
$250,000

$200,000

$179,000

$200,000
$150,000
$100,000
$50,000
$0
All owners

15 years+

Q. Approximately how much equity do you have in your home?

< 15 years

MEDIAN HOME EQUITY AMOUNT: $200,000

Median

$425,000

$450,000
$400,000
$350,000

$265,000

$300,000
$250,000

$200,000

$200,000
$150,000
$100,000
$50,000
$0
Equity

Purchase price

Home value

21

FINANCING

24% OF HOME OWNERS DO NOT HAVE A MORTGAGE

All owners
60%
50%

58%

15 years+

<15 years

58%

47%
38%

40%
30%

24%

20%

12%

10%

8%

15%

12%
1% 1% 1%

6% 6%6%

0%
Fixed rate

Adjustable rate

Q. What type of mortgage do you have?

Other

Unsure

Don't have a
mortgage

MAJORITY OF HOME OWNERS WITH A MORTGAGE

HAVE AN INTEREST RATE LESS THAN 5%
40.0%
33%

35.0%

35%

30.0%
25.0%
20.0%

17%

15.0%
10.0%

8.8%

6.5%

5.0%
0.0%
2-2.99%
Q. What is your current mortgage rate?

3-3.99%

4-4.99%

5-5.99%

6%+

27% OF HOME OWNERS HAVE TAPPED INTO THEIR

HOME EQUITY

Yes 27%

No 73%

Q. Is any portion of your outstanding mortgage balance form a cash-out refinance, second loan or home equity line of credit?

27% OF HOME OWNERS HAVE TAPPED INTO THEIR HOME

EQUITY

<15 years

24%

15 years+

32%

All owners

27%

0%

10%

20%

30%

40%

Q. Is any portion of your outstanding mortgage balance form a cash-out refinance, second loan or home equity line of credit?

WILL OWNERS SELL THEIR

HOMES?

35% HAVE CONSIDERED SELLING

40%

36%

30%
20%
10%

9.4%

7.1% 5.9% 6.9%

11%

9.9%

3.7%

0%

Q. On a scale of 1 to 10, how seriously have you thought about selling your home within the past year?

5.5% 4.6%

AVERAGE RATING
4.5
4.5

4.1

4.0

3.4

3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
All owners

15 years+

<15 years

Q. On a scale of 1 to 10, how seriously have you thought about selling your home within the past year?

WHY HAVE OWNERS CONSIDERED SELLING?

Factors Considered

All Owners 15Years+ <15Years

Capture equity gain in the

home

7.0

6.7

7.1

Desire for larger home

6.5

5.0

7.2

Desire for smaller home

5.8

6.1

5.6

Change in family status

5.6

5.1

5.8

Change in employment

5.6

5.1

5.8

I am retiring

5.0

5.2

4.9

I can no longer afford my

current home

4.7

4.3

4.9

Children left home

4.7

4.7

4.7

Children moved back in

4.2

3.6

4.4

Q. Please rate the importance of each of the following in your consideration to possibly sell your home. (1-10 scale)

59% OF HOME OWNERS HAVE NOT CONSIDERED

SELLING
Reasons for Not Selling

All
Owners

15
Years+

7.3

8.0

6.7

5.6

6.0

5.3

4.9

4.7

5.1

I'm waiting for the value of my home to increase.

4.8

4.0

5.5

The transaction cost of selling and buying is too high.

I'm concerned the mortgage rate on another home
would be too high.
I'm concerned it would be difficult to qualify for
financing to purchase another home.

4.7

4.7

4.7

4.6

4.4

4.7

3.7

3.4

4.1

3.2

2.7

3.5

3.0

2.7

3.3

My current home will be my retirement residence.

I'm concerned the property taxes on another home
would be too expensive.
The price of a home in my desired neighborhood is too
high.

We need the space (children/family moved back in).

I have not been able to find another house to buy
because listings are scarce.

Q. Please rate the importance of each of the following in your decision to not sell your home. (1-10 scale)

<15
Years

WHAT WOULD PROMPT HOME OWNERS TO SELL?

Motivations
If I get the price I want for my current home.
If I had a gain in my home value.
If I knew an equivalent or better house was
available to purchase
If I could carry over my current property tax bill.
If I had an increase in my income.
If I could carry over my current mortgage rate.

Q. What would prompt you to put your home up for sale within the next year?

All
Owners

15Years+ <15Years

6.8

6.2

7.2

6.5

5.7

7.0

6.4

5.7

6.8

5.9

5.9

5.9

5.9

5.0

6.5

5.4

4.3

6.0

NEARLY HOME OWNERS HAVE CONSIDERED MOVING

OUT OF STATE
30%

Average rating: 4.6

28%

25%
20%
15%
10%
5%

9.7%

13%
6.8% 5.2%
4.9%

0%

Q. How seriously have you considered moving out of state? (1-10 scale)

9.6% 10%

5.8% 6.7%

45% OF HOME OWNERS HAVE CONSIDERED MOVING

OUT OF STATE
Average Rating

% Considered Moving

Consideration Rating

5.0

60%
50%
45%
38%

4.0

40%

3.0
2.0

50%

30%
4.6

4.9
4.0

20%

1.0

10%

0.0

0%
All owners

15 years+

Q. How seriously have you considered moving out of state? (1-10 scale)

<15 years

Percent Considered Moving

6.0

TOP 10 STATES WHERE HOME OWNERS HAVE CONSIDERED

MOVING
Texas
Oregon
New York
Arizona
Nevada
Washington
Florida
Colorado
Hawaii
Idaho

15%
11%
8.9%
8.0%
7.7%
7.0%
6.1%
4.9%
4.4%
2.6%
0%

2%

Q. Where have you considered moving?

4%

6%

8%

10%

12%

14%

16%

DEMOGRAPHICS

HOME OWNER MEDIAN AGE: 51

8.4%

Silent

40%

Boomers
21%

Gen X

27%

Gen Y
0%

Q. What is your age?

10%

20%

30%

40%

50%

HOME OWNER MEDIAN AGE

40

<15 years

59

15 years+

51

All owners
0

Q. What is your age?

20

40

60

45% OF HOME OWNERS HAVE CHILDREN RESIDING

WITH THEM
Don't have
children
13%

Yes 45%

No 42%

Q. Do your children currently reside with you in the home?

83% OF CHILDREN RESIDING AT HOME ARE MINORS

90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

83%

6.5%
Under 18

Q. What is the age of each child living in the home?

18-21

7.0%
22-29

3.8%
30+

HOME OWNER MEDIAN ANNUAL HOUSEHOLD

INCOME: $77,000
8.5%

$200,000 +
$150,000-$199,999

7.7%

$100,000-$149,999

19%

$75,000-$99,999

20%

$50-000-$74,999

23%

< $50,000

21%
0%

Q. What is your total annual household income?

5%

10%

15%

20%

25%

71% OF HOME OWNERS ARE WHITE

White

71%

Hispanic

12%

Asian

12%

Black

2.9%

Other

2.7%
0%

10%

Q. What is your ethnic background?

20%

30%

40%

50%

60%

70%

80%

THANKYOU!
carmenh@car.org

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QUESTIONS?
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