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NAR Reports

Fresh stats on how home buyers search, who they hire, and what they buy

According to the annual NAR report, there is a shift in how home buyers shop, how quickly they buy, and what they’re looking for. All buyers’ agents must know these stats.

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Everyone’s doing it. Using the internet to search for a home, that is. Fully 92 percent of home buyers look for homes online, and 87 percent use the web to find a real estate professional, according to The 2014 National Association of Realtors® Profile of Home Buyers and Sellers.

Also interesting is that exactly half of home buyers used apps on their phone or tablet in their home search, 48 percent used mobile or tablet search engines, 48 percent called yard signs, and 44 percent went to open houses.

Despite tech startups hoping to disrupt the industry and cut agents out of the process, nearly all transactions are done through an agent, in fact, those who searched for homes online were actually more likely to purchase through an agent.

How shoppers do their research

As previously mentioned, and as you already knew, home buyers do their research, and they rely on a bevy of sources. Let’s face it – dreaming of a future home and shopping for months in advance is part of the fun. The challenge for the industry is to offer legitimate information and meet them where they shop.

But do buyers actually buy that home they found online? The NAR report indicates that 43 percent did buy a home they found online, but 33 percent found their home through a real estate professional, nine percent from a yard sign or open house, six percent from someone they knew personally, five percent from a home builder, three percent directly from the seller, and one percent from a print or newspaper ad.

In 2009, only 36 percent of shoppers located their future home online, so we should be fair and chalk this up to the improvements made in the real estate syndication space and data accuracy – it’s difficult to buy something that was sold months ago or didn’t exist in the first place.

What tight inventory has done to buyers

In most markets, inventory levels were extremely tight earlier this year and remain fairly tight, so buyers visited 10 homes and picked the winner two weeks faster than in 2013. With fewer homes for sale, the pressure is on to make a choice quickly, and getting it right is important, as first time buyers plan to stay in their home for 10 years, while repeat buyers plan to stay put for 15.

NAR indicates that 89 percent were satisfied with the buying process. What has the remaining 11 percent dissatisfied? Was it the agent, the lending process, the difficult sellers, the circumstances behind moving? That remains unclear, but this level of satisfaction has hovered around this point for years.

What buyers are looking for in 2014

The top consideration of all buyers is the quality of a neighborhood (69 percent), followed by convenience to their jobs (52 percent), affordability of homes (47 percent), and convenience to friends and family.

Less relevant to pulling the trigger, but still important is a home’s convenience to shopping (31 percent), the quality of the school district (30 percent), neighborhood design (28 percent), and convenience to entertainment (25 percent). Buyers’ median distance from their previous residence was 12 miles.

NAR points out that transportation costs and “green” features are more relevant, with 70 percent of buyers indicating that transportation costs are important, and 86 percent stating that heating and cooling costs are important. Two in three said energy efficient appliances and lighting were important.

Fully 79 percent of buyers purchased a detached single-family home, 8.0 percent a townhouse, 8.0 percent a condo, and 6.0 percent some other kind of housing. The typical home has three bedrooms and two bathrooms.

Half of all buyers purchased a home in a subdivision or suburb, 20 percent bought in a small town, 16 percent in an urban area, 11 percent in a rural area, and 3.0 percent in a resort/recreation area.

[notification type=”success” title=”READ ALSO: “]2014 stats: home SELLERS’ equity gains, tenure in homes, how they found their agent[/notification]

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

NAR Reports

Home sales on the rise – don’t call it a comeback (okay, do)

(REAL ESTATE) Inventory levels continue to fall as prices rise, making for a competitive market. After a tough winter, February saw considerable gains in home sales.

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For years, inventory levels have been sinking, and prices have been growing, making the home buying process increasingly complex and sometimes discouraging. But after two consecutive months of declining sales, existing-home sales made a comeback in February, rising 3.0 percent, according to the National Association of Realtors (NAR). Sales are now 1.1 percent higher than February of last year. #GoodNews

Although home sales in the Midwest and Northeast saw a dip in this period, the South and West regions skyrocketed, boosting the national numbers.

Dr. Lawrence Yun, NAR’s Chief Economist noted that “The very healthy U.S. economy and labor market are creating a sizeable interest in buying a home in early 2018. However, even as seasonal inventory gains helped boost sales last month, home prices – especially in the West – shot up considerably. Affordability continues to be a pressing issue because new and existing housing supply is still severely subpar.”

Added Yun, “The unseasonably cold weather to start the year muted pending sales in the Northeast and Midwest in January and ultimately led to their sales retreat last month. Looking ahead, several markets in the Northeast will likely see even more temporary disruptions from the large winter storms that have occurred in March.”

Click to enlarge.

In February, the median home price rose to $241,700, a 5.9 percent increase from February 2017, and the 72nd straight month of annual gains. The average days on market fell to 37, down from 41 in January, and 45 last February. That’s what we call a competitive market.

NAR President Elizabeth Mendenhall comments on the difficulty first-time buyers are seeing in this competitive market. “Realtors® in several markets note that entry-level homes for first-timers are hard to come by, which is contributing to their underperforming share of overall sales to start the year. Prospective buyers should start conversations with a Realtor® now on what they want in a new home. Even with the expected uptick in new listings in coming months, buyers in most markets will likely have to act fast on any available listing that checks all their boxes.”

Regional performance varied, with sales in the West outperforming all other regions. While sales fell in the Northeast by 12.3 percent, and dropped 2.4 percent in the Midwest, they skyrocketed 11.4 percent in the West, and 6.6 percent in the South.

february existing home sales

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NAR Reports

Existing home sales surged in October, what’s next?

(REAL ESTATE NEWS) Existing home sales rose in October despite continually tight inventory levels and rising home values.

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Despite the challenges of ongoing political uncertainty, extremely tight inventory conditions, and home values that continue to rise, existing home sales rose 2.0 percent in October, according to the National Association of Realtors (NAR).

This marks the strongest home sales pace since June, yet are 0.9 percent below October 2016. October’s average days on market was 34, down from 41 days on this month last year.

The median price has risen 5.5 percent in the last year to $247,000 with October marking the 68th consecutive month of annual increases. Nearly half of all homes on the market in October sold in under 30 days.

Dr. Lawrence Yun, NAR Chief Economist said, “While the housing market gained a little more momentum last month, sales are still below year ago levels because low inventory is limiting choices for prospective buyers and keeping price growth elevated.”

Added Yun, “The residual effects on sales from Hurricanes Harvey and Irma are still seen in parts of Texas and Florida. However, sales should completely bounce back to their pre-storm levels by the end of the year, as demand for buying in these areas was very strong before the storms.”

Regional performances varied with sales rising in the Northeast by 4.2 percent, in the West by 2.4 percent, the South by 1.9 percent, and 0.8 percent in the Midwest.

Prices also varied depending on region, with the median price in the West rising 7.8 percent above October 2016 (to $375,100), 6.6 percent in the Northeast (to $272,800), 7.1 percent in the Midwest (to $194,700), and 4.6 percent in the South (to $214,900).

Dr. Yun expects conditions to remain competitive through the winter, but housing is experiencing a tremendous hanging chad right now – what will politicians do to the tax deductions that incentivize homeownership in the first place?

NAR President Elizabeth Mendenhall, says the pending tax reform legislation in both the House and Senate is a direct attack on homeowners and homeownership, with the result being a tax increase on millions of middle-class homeowners in both large and small communities throughout the U.S.

“Making changes to the mortgage interest deduction, eliminating or capping the deduction for state and local taxes and modifying the rules on capital gains exemptions poses serious harm to millions of homeowners and future buyers,” said Mendenhall. “With first-time buyers struggling to reach the market, Congress should not be creating disincentives to buy and sell a home. Furthermore, adding $1.5 trillion to the national debt will raise future borrowing costs for our children and grandchildren.”

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NAR Reports

Sustained lull in signed contracts means pullback in home sales

(REAL ESTATE NEWS) Existing home sales aren’t looking super hot this month, but it’s not the bad news that you’re thinking – let’s discuss!

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Existing home sales slide in June

Low supply has kept home sales muted, with existing home sales dipping 1.8 percent in the month of June, albeit 0.7 percent above June of 2016, according to the National Association of Realtors. The Midwest region is the current bright spot as the only area sales actually rose during this period.

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Dr. Lawrence Yun, NAR Chief Economist, says the previous three-month lull in contract activity translated to a pullback in existing sales in June.

“Closings were down in most of the country last month because interested buyers are being tripped up by supply that remains stuck at a meager level and price growth that’s straining their budget,” said Yun.

He added, “The demand for buying a home is as strong as it has been since before the Great Recession. Listings in the affordable price range continue to be scooped up rapidly, but the severe housing shortages inflicting many markets are keeping a large segment of would-be buyers on the sidelines.”

There’s a silver lining

“The good news is,” observes Yun, “that sales are still running slightly above last year’s pace despite these persistent market challenges.”

The median price for an existing home rose 6.5 percent over the last year to $263,800, surpassing May as the new peak, and the 64th consecutive month of year-over-year gains.

Housing inventory declined 0.5 percent from the previous month, and 7.1 percent over the last year. Average days on market rose one day from May to 28 in June, which is down from 34 days in June 2016.

Supply and demand challenges

First time buyers were 32 percent of sales in June, down one percent from both in May and a year ago. Yun says “It’s shaping up to be another year of below average sales to first-time buyers despite a healthy economy that continues to create jobs,” said Yun.

“Worsening supply and affordability conditions in many markets have unfortunately put a temporary hold on many aspiring buyers’ dreams of owning a home this year,” noted Yun.

Spicy sales in the Midwest

In the Midwest, sales rose 3.1 percent from May but remain unchanged from this time last year. The median price rose 7.7 percent in the last year to $213,000.

In the Northeast, existing home sales actually fell 2.6 percent, but are 1.3 percent above a year ago (the median price was $296,300, up 4.1 percent for the year).

The South saw a 4.7 percent dip in sales ((unchanged from a year ago) and the median price in the South was $231,300, up 6.2 percent from a year ago.

Sales in the West declined 0.8 percent but are 2.5 percent above June 2016. The median price in the West was $378,100, up 7.4 percent from June 2016.

#HomeSales

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