Home buyers paid more in 2011
Although nationally, home prices have dropped 30 percent since the housing market peak in 2006, the 2011 National Association of Realtors® (NAR) Profile of Home Buyers and Sellers which surveyed 5,708 home buyers and sellers this summer, show that the typical buying price increased for recent home buyers, a shift that is also reflected in the demographic makeup and buying habits of home buyers having changed dramatically in the last year, reversing several trends set over the past decade.
The news that home buyers paid more this year for homes follows the trend of buyer demographics as more buyers this year were repeat buyers, more stable, mature, older buyers with higher incomes, therefore, they typically purchased homes that were slightly more expensive in a year where first time buyers dropped from half of all buyers to a third.
The median price paid was $190,000, up roughly 6.2 percent from last year, but median prices varied widely depending on the region with the median price in the West at $233,600 and the Midwest at $165,000. The median price for a new home was $230,000 which was substantially higher than the median price of $180,000 for an existing home.
Another disparity in what buyers paid for a home was first time buyers’ $155,000 spend compared to repeat buyers’ $219,000 spend.
Buyers got better deals this year
In 2011, NAR reports that the median purchase price buyers paid for a home was only 96 percent of the asking price, a one percent reduction from last year, meaning on average, buyers got better deals this year, but not all buyers – ten percent paid over the asking price while 20 percent paid the actual asking price.
Home sizes continue to shift
The median home purchased rose in 2011, reversing the trend of shrinking homes with the average home purchased in 2010 sitting at 1,780 square feet, growing to 1,900 square feet in 2011 which makes sense as repeat buyers and mature buyers typically buy larger houses – first time buyers averaged a 1,570 sf purchase and repeat buyers averaged 2,100 sf.
Home sizes purchased fluctuate depending on region and who purchased. Homes in the South were generally larger than other regions with a median 2,050 sf and as expected, married couples and families with children bought larger homes and single buyers bought the smallest homes.
Home buyers with children typically purchased a four bedroom, two bathroom home and 70 percent of single buyers bought a three bedroom home or larger whereas 90 percent of married buyers bought at least a three bedroom house.
Price per square foot varied across America
Breaking that down further, the NAR looked at price per square foot, reporting that homes were less expensive per square foot in the South and the Midwest compared to the West and Northwest and the most expensive type of home based on price per square foot was condos in buildings with five or more units.
Detached single family homes (which are the most popular type of purchase at 77 percent of all homes bought in 2011), duplexes and condos in buildings with under five units were the least expensive per square foot.