Housing News
Why the demographics of home buyers, types of homes being sold quickly shifted
The new American home buyer
The portrait of an average home buyer in America has rapidly changed as unemployment continues to remain high as do fears of job instability, and as the Home Buyer Tax Credit ended in 2010. Lending standards have tightened and Realtors say the number one problem they are having with transactions are their falling apart last minute and in 2010, one in three mortgage applicants were denied. In just one year, first time home buyers have dropped to a third of all buyers, down from half of all buyers, and older, more stable buyers now account for more of the market, according to the 2011 National Association of Realtors® (NAR) Profile of Home Buyers and Sellers which surveyed 5,708 home buyers and sellers this summer.
NAR reports that there was “a reversal of a ten year trend” of more single buyers in the market and many buyers are moving up or down because of non-optional life events like a job relocation, leading to a market where buyers aren’t buying out of a desire for change, rather a requirement for one which the NAR says “shifts the dynamics of the home buying market and the demographics of buyers.”
The new American home
Because of the changing demographics as mentioned above, the type of home that is being purchased has changed quite a bit in the last two years, according to NAR. Because more stable buyers are taking to the market, a higher share of buyers are repeat buyers which has caused an upward shift in the typical home size, as is typical with repeat buyers. New home sales continues to suffer compared to recent years past, despite a recent uptick in the market.
The biggest news from this report is that when buyers move in to their newly purchased homes, they expect to live there for 15 years, “substantially longer than seen in previous years,” NAR notes. As expected, first time buyers expect a shorter time in a home while older buyers anticipate spending longer in a house.
The takeaway
We will be looking into more detailed accounts of what changes are taking place, but it is first important to understand why the market has made such a dramatic shift.
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Housing News
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.
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Housing News
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
Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.
…Click here to continue reading this story…
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Noto
June 20, 2012 at 1:54 am
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Noto
June 20, 2012 at 2:00 am
64% of recent home buyers were married couples, the highest share since 2001. interesting!
I see an infographic of breakdown of home buyers on movoto.com. They pointed out that married couples will remain the predominant home buyers. And these people care about quality of a neighborhood, convenience to work and overall affordability, etc.
Looks like the young generation still suffer from the finacial crisis.