November is Homebuyers and Sellers Month.
November is Homebuyers and Sellers Month. Make sure you understand what your clients are looking for and get the resources you need to assist them through their buying or selling process.
GET TO KNOW THE AVERAGE HOMEBUYER & SELLER
Each year, NAR releases an annual Homebuyers and Sellers report, which looks at the characteristics and demographics of buyers and sellers, as well their use of real estate professionals during the process. Check out the 2021 report here, and get to know the average buyer and seller in the infographic below.
For most home buyers, the purchase of real estate is one of the largest financial transactions they will make. Buyers purchase a home not only for the desire to own a home of their own, but also because of changes in jobs, family situations, and the need for a smaller or larger living area. This annual survey conducted by the NATIONAL ASSOCIATION OF REALTORS® of recent home buyers.
This report examines:
- Characteristics of Home Buyers
- Characteristics of Homes Purchased
- The Home Search Process
- Home Buying and Real Estate Professionals
- Financing the Home Purchase
- Home Sellers and Their Selling Experience
- Home Selling and Real Estate Professionals
- For Sale by Owner (FSBO) Sellers
Characteristics of Home Buyers
- First-time buyers made up 26%, down from last year's 34%. This is the lowest share of first-time buyers since the data collection began.
- The typical first-time buyer was 36 years old this year, rising from 33 last year, while the typical repeat buyer age climbed to 59 years. Both are all-time highs.
- 61% of recent buyers were married couples, 17% were single females, 9% were single males, and 10% were unmarried couples. This is the highest share of unmarried couples recorded.
- Among first-time buyers, 18% of buyers were unmarried couples, and 5% were other household compositions. Both are the highest shares recorded.
- 14% of home buyers purchased a multigenerational home, to take care of aging parents, because of children or relatives over the age of 18 moving back home, and for cost-savings.
- 88% of buyers were White/Caucasian, 8% were Hispanic/Latino, 3% were Black/African-American, 2% were Asian/Pacific Islander, and 3% identified as other. The share of White/Caucasian buyers and Hispanic/Latino buyers both grew this year, while the share of other racial and ethnic groups declined.
- 91% of recent home buyers identified as heterosexual, 2% as gay or lesbian, 2% as bisexual, and 5% preferred not to answer.
- 22% of recent home buyers were veterans and 1% were active-duty service members.
- At 22%, the primary reason for purchasing a home was the desire to own a home of their own. For first-time buyers, this number jumps to 62%.
Non-member Price: $199.95
Member Price: $19.95
Member Savings: $180.00
Characteristics of Homes Purchased
- 12% of buyers purchased a new home, and 88% of buyers purchased a previously-owned home.
- Most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or electricity at 41%. Buyers who purchased previously-owned homes were most often considering better price at 31%.
- Detached single-family homes continued to be the most common home type for recent buyers at 79%, followed by mobile or manufactured houses at 8%.
- Senior-related housing held steady this year at 7% (for buyers over the age of 60), with 17% of buyers typically purchasing condos and 8% purchasing a townhouse or row house.
- The median distance between the home that recent buyers purchased and the home they moved from was 50 miles. This is a significant increase in distance moved, as the distance between 2018 and 2021 was a median of 15 miles.
- For buyers, 49% cited quality of the neighborhood as the most important factor determining the location. Convenience to friends and family and overall affordability of homes were both cited at 37%.
- Buyers typically purchased their homes for 100% of the asking price, with 28% purchasing for more than asking price.
- The typical home that was recently purchased was 1,800 square feet, had three bedrooms and two bathrooms, and was built in 1986.
- Overall, buyers expected to live in their homes for a median of 15 years, while 28% said that they were never moving.
The Home Search Process
- For 47% of recent buyers, the first step that they took in the home buying process was to look online at properties for sale, while 18% of buyers first contacted a real estate agent.
- 86% of recent buyers found their real estate agent to be a very or somewhat useful information source.
- Buyers typically searched for 10 weeks and looked at a median of five homes, and viewed four homes only online. The number of weeks searching for a home grew from eight weeks seen in the 2020 and 2021 reports.
- Nearly all buyers used online tools in the search process at 96%.
- When asked where their internet searches were conducted, they typically conducted 60% of their search on a mobile device(s), and a 34% on a desktop/laptop.
- 91% of recent buyers were at least somewhat satisfied with their recent home buying process.
Home Buying and Real Estate Professionals
- 86% of buyers recently purchased their home through a real estate agent or broker, and 10% purchased directly through the previous owner.
- Having an agent to help them find the right home was what buyers wanted most when choosing an agent at 49%.
- 38% of buyers used an agent that was referred to them by a friend, neighbor, or relative, 12% used an agent that they had worked with in the past to buy or sell a home, and 10% found their agent when inquiring about a specific property found online.
- 67% of buyers interviewed only one real estate agent during their home search.
- 89% of buyers would use their agent again or recommend their agent to others.
Financing the Home Purchase
- 78% of recent buyers financed their home purchase, down from 87% in the 2021 report.
- The typical downpayment for first-time buyers was 6%, while the typical downpayment for repeat buyers was 17%.
- For 47% of buyers, the source of the downpayment came from their savings. 38% of repeat buyers cited using the proceeds from the sale of a primary residence, while 22% of first-time buyers used a gift or loan from friends or family for the downpayment.
- For first-time home buyers, 26% said saving for a downpayment was the most difficult step in the process.
- The majority of first-time buyers did make financial sacrifices to purchase a home. For those who did, the most common sacrifices buyers reported were cutting spending on luxury goods, entertainment, and clothes.
- Buyers continue to see purchasing a home as a good financial investment. 88% reported they view a home purchase as a good investment.
Home Sellers and Their Selling Experience
- The typical home seller was 60 years old, an increase from 56 last year.
- For all sellers, the most commonly cited reason for selling their home was the desire to move closer to friends and family (21%), moving due to retirement (11%), or the neighborhood has become less desirable (11%).
- Sellers typically lived in their home for 10 years before selling. This is an increase from eight years in last year’s report, but reverts back to the same tenure seen in 2019 and 2020.
- 41% of sellers traded up to a larger home and 32% purchased the same size home.
- 86% of home sellers worked with a real estate agent to sell their home, 10% sold via FSBO, and less than 1% sold via iBuyer.
- For recently sold homes, the final sales price was a median of 100% of the final listing price, the highest recorded since 2002.
- Recently sold homes were on the market for a median of two weeks, an increase from one week last year.
- Only 20% of sellers offered incentives to attract buyers, a drop from 26% of all sellers last year.
- 91% of sellers were at least somewhat satisfied with the selling process.
Home Selling and Real Estate Professionals
- 63% of sellers found their agent through a referral from a friend, neighbor, or relative or used an agent they had worked with before to buy or sell a home.
- 80% of recent sellers contacted only one agent before finding the right agent they worked with to sell their home.
- 39% of sellers used the same agent to purchase a home, as sell their home. A share which rises to 85% for sellers who purchased a new home within 10 miles.
- 86% of sellers listed their homes on the Multiple Listing Service (MLS), which is the number one source for sellers to list their home.
- 74% of sellers reported that they provided the agent’s compensation.
- The typical seller has recommended their agent once since selling their home. 27% of sellers recommended their agent four or more times since selling their home.
- 85% said that they would definitely (73%) or probably (12%) recommend their agent for future services.
For-Sale-by-Owner (FSBO) Sellers
- 10% of recent home sales were FSBO sales this year. This is up from seven% last year.
- The majority of FSBO sellers, 50%, knew the buyer of the home.
- Within rural areas 13% sold via FSBO compared to 6% of sellers in suburban areas.
- FSBOs typically sell for less than the selling price of other homes; FSBO homes sold at a median of $225,000 last year, significantly lower than the median of agent assisted homes at $345,000.
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