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
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

Househol
d
Compositi
on

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%
unmarrie
d couples

Children
in Home

35%

36%

41%

40%

35%

nd
Own
a
2
14%
19%
Profile of Home Buyers and Sellers
Home

19%

19%

21%

Shift in Household Composition

2014 Profile of Home Buyers and Sellers

Rise in Household Income

2014 Profile of Home Buyers and Sellers

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 First-time
Buyers
Buyers
Desire to own a home of
my own
Job-related relocation or
move
Desire for a home in a
better area
Change in family situation
Desire for larger home
Affordability of homes
Desire to be closer to
family/friends/relatives
Retirement
Establish a household
Desire
smaller
home
2014
Profile for
of Home
Buyers and
Sellers

Repeat
Buyers

24%

53%

9%

9

4

12

8
8
7
5

2
5
1
8

11
9
10
3

3
3
3
3

1
*
7
*

4
5
1
4

Buyers’ View of Homes as a Financial
Investment
Marri Singl
ed
e Singl Unmarri
All coupl femal
e
ed
Buyers
e
e male couple
Good financial
investment
Better than stocks
About as good as
stocks
Not as good as
stocks
Not a good financial
investment
Don't know

79%
40

2014 Profile of Home Buyers and Sellers

79% 78% 81%
39
46
40

83%
37

27

27

25

24

33

12

13

7

17

13

7
14

7
14

6
15

8
12

6
12

Expenses that Delayed Saving for
Downpayment or Saving for Home
Purchase
All First-time
 
Buyers
Buyers
12%
23%
Share Saving for Downpayment
was Most Difficult Task in
Buying Process:
 
 
Debt that Delayed Saving:
Credit card debt
50%
45%
Student Loans
46
57
Car loan
38
42
Child care expenses
17
13
Health care costs
12
8
Other
8
5
2014 Profile of Home Buyers and Sellers

Repeat
Buyers
7%
 
58%
28
32
24
17
14

Where to go?
• 57 million Americans or 18.1% of the
population live in a multigenerational 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 Married
Buyers couple
Multi-generational
household
Reasons for
purchase:
 
Cost Savings
Children over 18
moving back into the
house
Health/Caretaking of
aging parents
To spend more time
with aging parents
Other

13%

Single
female

13%
 

Unmarri
Single
ed
male couple

13%
 

16%
 

7%
 

24%

21%

24%

31%

36%

23

26

23

17

3

18

19

18

14

22

10
24

12
22

8
26

6
32

14
25

2014 Profile of Home Buyers and Sellers

Pent Up Demand
2000

2013

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

Existing Home
Sales

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

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
Marrie Single
d femal
couple
e
Move with life changes (addition to
family, marriage, children move
out, retirement, etc.)
Never moving-forever home
Move with job or career change
May desire better
area/neighborhood
May outgrow home
Will flip home
Other

2014 Profile of Home Buyers and Sellers

Unmarri
Single
ed
male couple

40%
24
20

55%
24
9

49%
15
13

44%
16
20

9
7
1
6

7
4
1
5

12
7
3
7

13
14
3
4

Home Type and Location

Home Type Bought
• 84% previously owned homes
– Even if new home—58% 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 Features—Good for
Earth and Wanted by clients

Compromises on Home Purchase

Price of home
Size of home
Condition of home
Lot size
Style of home
Distance from job
Distance from friends or
family
Quality of the neighborhood
Quality of the schools
Distance from school
2014 Profile of Home Buyers and Sellers
None - Made no compromises

All
FirstBuyer
time Repeat
s Buyers Buyers
23%
25%
21%
20
27
17
18
19
17
16
18
15
16
18
14
14
18
11
7
5
4
2
33

9
6
7
3
25

6
5
2
1
36

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
Difficulty in obtaining mortgage
finance
No factors are limiting potential
clients
Ability to sell existing home
Expectation that prices might
fall further
Low consumer confidence
Concern about losing job
2014 Member Profile

33%
25
16
7
6
6
1

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

Profile of Home Buyers and Sellers

Buyer Use of Online Agent
Recommendations

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
E-mail
Contacted friend/family
Web form on home listing website
Text message
Through agent's website
Social Media (FaceBook, Twitter,
LinkedIn, etc.)
Other
Number of Times Contacted
(median)
2014 Profile of Home Buyers and Sellers

56%
21
7
5
3
3
2
4
1

Call Them Back!
Number of Agents Buyer Interviewed Before Picking
Agent Used

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

Searched with an iPhone
Search with an iPad
Searched with an Android
Found my home with a mobile
application
Search with a different tablet
Searched with a Windows based
mobile device
Found my agent with a mobile
application
2014
Profile
of Home
Buyers
and lead
Sellers me to
Used
QR
Code
that

All
FirstBuyer
time
s Buyers
52%
54%
46
39
27
33

Repe
at
Buye
rs
51%
50
23

27
10

30
11

24
9

6

5

7

4

4

4

Keep in Contact

Calls personally to inform of activities
Sends postings as soon as a property is
listed/the price changes/under contract
Sends emails about specific needs
Can send market reports on recent
listings and sales
Sends property info and communicates
via text message
Has a web page
Has a mobile site to show properties
Sends an email newsletter
Advertises in newspapers
Is active on Facebook/Twitter
2014 Profile of Home Buyers and Sellers
Has a blog

All
Buyer
s
79%

Repea
Firstt
time Buyer
Buyers
s
75% 80%

69
59

69
60

69
58

51

47

54

45
29
25
10
6
6
1

48
29
25
11
5
7
1

44
30
25
10
7
5
1

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 time—28% have recommended
3+ times
– 83% of sellers would use agent again or recommend to others
• Since selling typically have 1 times—28% have recommended
3+times

2014 Profile of Home Buyers and Sellers

Where to find NAR
Research
• Jessica Lautz: jlautz@realtors.org, 202-3831155
• NAR Research www.
realtor.org/research-and-statistics
• Economists’ Outlook Blog:
economistsoutlook.blogs.realtor.org
• Facebook: facebook.com/narresearchgroup
• Twitter: twitter.com/NAR_Research