You are on page 1of 41

John L.

Scott
Convention
Jessica Lautz
National Association of REALTORS

October 30, 2014
Methodology
Survey conducted with recent home buyers who purchased a home
between July 2013 June 2014
Survey consists of 127 questions
Seller information gathered from those home buyers who sold a home
Mailed 72,206 questionnaires- response rate of 9.4%
Names obtained from Experian
Data in the presentation is based on medians or the typical buyer in the
category and is not all encompassing
Share of Home Sales
2014 Investment and Vacation Home Buyers Survey
Buyer Demographic Changes
Profile of Home Buyers and Sellers
2010 Profile 2011 Profile 2012 Profile 2013 Profile 2014 Profile
Median Age 39 45 42 42 44
Gross HH
Income
$72,200 $80,900 $78,600 $83,300 $84,500
Household
Composition
58% married
couples,
20% single
females, 12%
single males,
8% unmarried
couples
64% married
couples,
18% single
females,
10% single
males,
7% unmarried
couples
65% married
couples,
16% single
females,
9% single
males,
8% unmarried
couples
66% married
couples,
16% single
females,
9% single
males,
7% unmarried
couples
65% married
couples, 16%
single
females, 9%
single males,
8%
unmarried
couples
Children in
Home
35% 36% 41% 40% 35%
Own a 2
nd

Home
14% 19% 19% 19% 21%
Shift in Household Composition
2014 Profile of Home Buyers and Sellers
2014 Profile of Home Buyers and Sellers
Rise in Household Income
First-time Buyer Share Remains Under Historical Norm
Profile of Home Buyers and Sellers
Young Adult Homeownership Rate
Home Prices Outpacing Incomes
(under 35 years old)
Desire of Gen Y to Buy is Still Present
59 percent of young renters (18 to 39) believe owning a home
makes more sense, but 73 percent of young renters also believe
it would be difficult to get a mortgage today
75% believe home ownership is an important long-term goal
73% believe ownership is an excellent investment
24% already own their home and an additional 60% plan to buy
a home in the future.

Fannie Mae, 2013 Demand Institute Housing and Community Survey

Primary Reasons for Buying a Home
All Buyers
First-time
Buyers
Repeat
Buyers
Desire to own a home of my own 24% 53% 9%
Job-related relocation or move 9 4 12
Desire for a home in a better area 8 2 11
Change in family situation 8 5 9
Desire for larger home 7 1 10
Affordability of homes 5 8 3
Desire to be closer to
family/friends/relatives 3 1 4
Retirement 3 * 5
Establish a household 3 7 1
Desire for smaller home 3 * 4
Financial security 3 6 1
2014 Profile of Home Buyers and Sellers
Buyers View of Homes as a Financial Investment
All
Buyers
Married
couple
Single
female
Single
male
Unmarried
couple
Good financial investment 79% 79% 78% 81% 83%
Better than stocks 40 39 46 40 37
About as good as stocks 27 27 25 24 33
Not as good as stocks 12 13 7 17 13
Not a good financial
investment 7 7 6 8 6
Don't know 14 14 15
12 12
2014 Profile of Home Buyers and Sellers
Expenses that Delayed Saving for Downpayment
or Saving for Home Purchase
2014 Profile of Home Buyers and Sellers

All
Buyers
First-time
Buyers
Repeat
Buyers
Share Saving for Downpayment was Most
Difficult Task in Buying Process:
12% 23% 7%
Debt that Delayed Saving:

Credit card debt 50% 45% 58%
Student Loans 46 57 28
Car loan 38 42 32
Child care expenses 17 13 24
Health care costs 12 8 17
Other 8 5 14
Where to go?
57 million Americans or 18.1% of the
population live in a multi-generational
family household in 2012,
double the number who lived in
such households in 1980
Of those who are 25-34:
20% of the unemployed live with
parents
12% of employed live with parents

Pew Research, Federal Reserve Bank of New York
Multi-generational Home
All
Buyers
Married
couple
Single
female Single male
Unmarried
couple
Multi-generational
household 13% 13% 13% 16% 7%
Reasons for purchase:
Cost Savings 24% 21% 24% 31% 36%
Children over 18 moving
back into the house 23 26 23 17 3
Health/Caretaking of aging
parents 18 19 18 14 22
To spend more time with
aging parents 10 12 8 6 14
Other 24 22 26 32 25
2014 Profile of Home Buyers and Sellers
Pent Up Demand
2000 2013
Existing Home Sales 5.2 m 5.1 m
New Home Sales 880 K 430 K
Mortgage Rates 8.0% 4.0%
Payroll Jobs 132.0 m 136.4 m
Population 282 m 316 m
Seller Wanted to Sell Earlier But Waited or Stalled
Because the Home Was Worth Less than the Mortgage
2014 Profile of Home Buyers and Sellers
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Sellers 1 year or
less
2 to 3
years
4 to 5
years
6 to 7
years
8 to 10
years
11 to 15
years
16 to 20
years
21 years
or more
16%
3%
2%
12%
19%
26%
22%
12%
8%
83
97 97
86
78
72
77
87
91
No, sold home when I wanted to sell Yes, but rented home to others and lived elsewhere
Yes, and lived in home
Actual Tenure Among Sellers Remains High
Profile of Home Buyers and Sellers
Expected Tenure Remains High
Profile of Home Buyers and Sellers
Force Buyer to Move Again
Married
couple
Single
female
Single
male
Unmarried
couple
Move with life changes (addition to family,
marriage, children move out, retirement, etc.) 40% 55% 49% 44%
Never moving-forever home 24 24 15 16
Move with job or career change 20 9 13 20
May desire better area/neighborhood 9 7 12 13
May outgrow home 7 4 7 14
Will flip home 1 1 3 3
Other 6 5 7 4
2014 Profile of Home Buyers and Sellers
Home Type and Location
Home Type Bought
84% previously owned homes
Even if new home58% used an agent to buy!
79% detached single-family home
Where?
50% suburb
20% small town
16% urban
11% rural area
3 bedrooms/2 baths
1,870 square feet
Built in 1993
12 miles from past residence for buyers

2014 Profile of Home Buyers and Sellers
Location, Location, Location
Quality of the neighborhood
Convenient to job
Overall affordability of homes
Convenient to friends/family
Convenient to shopping
Quality of school district
Design of neighborhood
2014 Profile of Home Buyers and Sellers
Commuting Costs
Environmentally Friendly FeaturesGood for Earth and
Wanted by clients
Compromises on Home Purchase
All
Buyers
First-time
Buyers
Repeat
Buyers
Price of home 23% 25% 21%
Size of home 20 27 17
Condition of home 18 19 17
Lot size 16 18 15
Style of home 16 18 14
Distance from job 14 18 11
Distance from friends or family 7 9 6
Quality of the neighborhood 5 6 5
Quality of the schools 4 7 2
Distance from school 2 3 1
None - Made no compromises 33 25 36
2014 Profile of Home Buyers and Sellers
Inventory Still Tight
Tightened Inventory Affects Home Search and Selling
Buying Side:
Buyers saw 10 homes before buying
Typically look for 10 weeks total and 2 weeks before contacting
an agent
53% of buyers reported hardest task is in process was finding
the right home
Selling Side:
Typically received 97% of final asking price
Median time on market 4 weeks 11 weeks in 2012
For FSBO sellers who did not know the buyer
15% were contacted by a buyer they did not know asking to
buy home

2014 Profile of Home Buyers and Sellers
Most Important Factor Limiting Clients
ALL REALTORS
Difficulty in finding the right property 33%
Difficulty in obtaining mortgage finance 25
No factors are limiting potential clients 16
Ability to sell existing home 7
Expectation that prices might fall further 6
Low consumer confidence 6
Concern about losing job 1
2014 Member Profile
Agent Use By Buyers & Sellers Remains High
88% of buyers purchased their home through a real estate agent
or broker
Most want help finding right home
Benefited from help understanding the process
High importance on honesty and integrity
88% of sellers were assisted by an agent
Help market home
Sell w/in specific timeframe
Help price home competitively
Reputation and honesty and integrity important


2014 Profile of Home Buyers and Sellers
Agent Assisted Sales High
19
17
15
18
16
13
14 14
13
12 12
13
11
9
10
9 9 9
77
82
81
80
77
79
83
82
85
84
85
84
85
88
87
88 88 88
4
1
4
4
7
8
4
4
2
3
3 3
4
3 3
2
3
2
0
10
20
30
40
50
60
70
80
90
100
All FSBO (For-sale-by-owner) Agent-assisted Other
Profile of Home Buyers and Sellers
Buyer Use of Online Agent Recommendations
Used online
recommendations
and it influenced
choice of agent
10%
Used online
recommendations
and it did not affect
my agent choice
9%
Did not use online
recommendations
but would consider
doing so next time
38%
Did not use online
recommendations
and would not
consider using
43%
2014 Profile of Home Buyers and Sellers
Personal Recommendations are Key!
How buyers found agent:
40% referred by or is a friend, neighbor, relative
12% used agent they had previously worked with
Selling side:
38% referred by or is a friend, neighbor, relative
22% used an agent they had previously used to buy/sell a
home
What you tell us:
21% of business from past consumers and clients
21% of business from referrals from past consumers and clients

2014 Profile of Home Buyers and Sellers, 2014 Member Profile
How and How Many Times Contact Agent
Method
Phone call 56%
E-mail 21
Contacted friend/family 7
Web form on home listing website 5
Text message 3
Through agent's website 3
Social Media (FaceBook, Twitter, LinkedIn, etc.) 2
Other 4
Number of Times Contacted (median) 1
2014 Profile of Home Buyers and Sellers
Call Them Back!
Number of Agents Buyer Interviewed Before Picking Agent Used
0%
10%
20%
30%
40%
50%
60%
70%
One Two Three Four or more
67%
20
8
4
2014 Profile of Home Buyers and Sellers
The Search Process
Frequency of Use
Value of Website Features
2014 Profile of Home Buyers and Sellers
Make Your Site Mobile Ready
All
Buyers
First-time
Buyers
Repeat
Buyers
Searched with an iPhone 52% 54% 51%
Search with an iPad 46 39 50
Searched with an Android 27 33 23
Found my home with a mobile application 27 30 24
Search with a different tablet 10 11 9
Searched with a Windows based mobile
device 6 5 7
Found my agent with a mobile application 4 4 4
Used QR Code that lead me to more
information on the property 3 3 4
2014 Profile of Home Buyers and Sellers
Keep in Contact
All
Buyers
First-time
Buyers
Repeat
Buyers
Calls personally to inform of activities 79% 75% 80%
Sends postings as soon as a property is listed/the
price changes/under contract 69 69 69
Sends emails about specific needs 59 60 58
Can send market reports on recent listings and sales 51 47 54
Sends property info and communicates via text
message 45 48 44
Has a web page 29 29 30
Has a mobile site to show properties 25 25 25
Sends an email newsletter 10 11 10
Advertises in newspapers 6 5 7
Is active on Facebook/Twitter 6 7 5
Has a blog 1 1 1
2014 Profile of Home Buyers and Sellers
Satisfaction
Process:
89% of buyers are satisfied with the buying process
88% of sellers are satisfied with the selling process
With the agent:
88% of buyers would use agent or recommend to others
Since buying typically have 1 time28% have recommended
3+ times
83% of sellers would use agent again or recommend to others
Since selling typically have 1 times28% have recommended
3+times
2014 Profile of Home Buyers and Sellers
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