Home buyers prefer single-family detached homes, are avoiding renovations, and move within 14 miles of their last home, according to the 2015 National Association of Realtors Profile of Home Buyers and Sellers. Sizes and prices of homes purchased inched up from last year, and how long they expect to be in their home depends upon whether it is their first.
For 34 years, NAR has profiled buyers and sellers and evaluated the demographics, preferences, motivations, plans, and experiences of recent home buyers and sellers (owner-occupants). This has helped real estate professionals understand consumers and their motivations.
New vs. existing homes
New homes purchased this year accounted for 16 percent of the market, with previously owned homes made up for 84 percent. People typically sought out new homes to avoid renovations and plumbing/electricity problems, and those that bought existing homes cited considering a better price (than new) as their motivator.
New home buyers also like that they can customize features in their home (30 percent), and having the amenities of new home construction communities (17 percent).
Buyers who chose a previously owned home were considering a better price (32 percent), overall value (29 percent), and a home with more charm and character (19 percent).
What people are looking for
Detached single-family homes continue to be the most common home type for recently buyers at 83 percent, followed by 7.0 percent of buyers choosing townhomes or row houses.
The report notes that “Townhomes continue to be more common among first-time home buyers, compared to repeat buyers. Single female and single male buyers were more likely to purchase a townhouse or condo than married couples and unmarried couples.”
Regarding neighborhood choice, NAR notes that factors remain consistent with last year: Quality of the neighborhood (59 percent), convenience to job (44 percent), and overall home affordability (38 percent) were the three most important factors to recent home buyers when choosing a neighborhood.
Recent buyers were only “somewhat concerned” with commuting costs and environmental features, but they did influence some decisions.
Sizes and prices on the rise
The average home recently purchased was built in 1991, has three bedrooms and two baths, is 1,900 sf (up slightly from last year). First-time buyers snagged smaller homes, averaging 1,620 sf, and repeat buyers averaged 2,020 sf.
Buyers typically purchased their homes for 98 percent of the asking price, and the median price increased to $220,000 among all buyers.
The median price for an new home was $277,000 and the median price for a previously owned home was $209,000.
Repeat buyers purchased homes that were a median of $246,400, where the first-time buyers purchased homes that were a median of $170,000.
The largest discount on homes was see in the Northeast where 15 percent of buyers paid less than 90 percent of the asking price for their homes.
“Different than last year, the most expensive price per square food was found in townhomes and row homes. The price per square foot in these homes was $130. The next most expensive was duplexes, apartments, and condos in a two to four unit building at $120 per square foot,” cites NAR.
Expected tenure in their home
First-time and repeat buyers are intending to stay in their homes for the same length of time as the previous year at 10 years and 15 years respectively.
NAR notes, “The youngest buyers between the ages of 18 ad 24 had the shortest expected tenure of just eight years, compared to buyers aged 45 and older who expect to stay in their homes for 15 years.”
Two in five buyers said that they would potentially move because of a life change, such as an addition to the family, marriage, children moving out, or retirement. Buyers between 18 and 24 were most likely to move because of a job change.
Surprisingly, households with no children were the most likely at 26 percent to say that they are never moving and that this is their forever home.