2011 Buyers and Sellers Survey
The 2011 National Association of Realtors® Profile of Home Buyers and Sellers surveyed 5,708 home buyers and sellers and discovered interesting trends in how buyers come up with their downpayment, what sacrifices they felt they had to make in order to buy their home and how difficult they perceived the home buying process to be.
Funding a downpayment
While two in every three home buyer used savings this year to fund their downpayment, one in four used proceeds from the sale of a primary residence. Additionally, 14 percent of buyers noted gifts from a friend or relative funded their downpayment.
First time buyers are more likely to rely on savings (79 percent) for a downpayment and are also more likely to rely on gifts and loans from friends or relatives while repeat buyers used savings 59 percent of the time and used proceeds from the sale of their primary residence 41 percent of the time.
While over half of all buyers said they didn’t have to make any sacrifices in order to purchase their home, first time buyers were more likely to indicate a sacrifice was made, most commonly in the form of sacrificing luxury spending. Like first time buyers, unmarried couples and single females were most likely to sacrifice for a home purchase.
Difficulty in the process
Not surprising, two in every five home buyers said the mortgage application and approval process was more difficult than expected which is similar to the study results from 2010 but significantly higher than the two years prior. Interestingly, 16 percent of buyers found the process to be easier than they had expected.
Most consumers use savings or home sale proceeds to fund their downpayment and first time buyers are more likely to rely on gifts and loans. First time buyers, single females and unmarried couples were most likely to respond that they had to make sacrifices like cutting back on luxury spending in order to obtain their home. Many buyers found the mortgage process to be more difficult than they expected it would be.
Realtors should know current trends regarding who typically has to make sacrifices, where downpayment monies are coming from and how difficult the process is in an effort to know not only what consumers are telling their friends (“oh it was so time consuming and difficult, plus I had to give up going to the movies every week!”) because perception is reality, so knowing that consumers expect frustration but also expect to make sacrifices and have money saved up gives any agent an advantage when preparing a buyer for their purchase.
Austin tops the list of best places to buy a home
When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?
Looking at the bigger picture
(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).
That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).
They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.
“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
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