Unique Real Estate Market Findings from Recent Survey
Buyers who are buying their first home are coming into the market in bigger numbers than the industry watchers had previously thought. In fact, in the past year, almost half of home sales were to those who were buying a first home. This statistic is from a survey from Zillow, which is a real estate firm. Half of the buyers and sales is a much higher percentage than other industry professionals had estimated.
The Survey Broken Down
The survey from Zillow suggests that the growth in home sales is largely coming from couples in their 30’s, as they are the most common sector of first home buyers. If that is a trend to continue, it may raise hopes that the generation of 18 to 34-year-old millennials could help support the housing market in the future as more of them move into their 30s.
This finding was in an over 150-page report by Zillow and it also found that home ownership is more often the domain of the college-educated. Another factor that it uncovered is that older Americans that are downsizing are paying premiums for homes that are smaller.
Other findings include:
- Forty-seven percent or purchases in the last year were to first-time home buyers. They purchased homes at the median age of 33.
- Most commonly, people who own or are buying homes have at least a four-year college degree. Sixty-two percent of home buyers have at least this degree or more. When you consider that just 33 percent of adults in the US have graduated from college, you can see that the gap between education levels of homebuyers and the broader US population is getting wider.
- Larger numbers of millennial homebuyers are Hispanic. Of the 74 million US households that own homes, 77 percent are white, but the demographics are rapidly changing. Of millennial homeowners, only 66 percent are white with 17 percent of them Latino.
- Older Americans are not just looking to downsize, but also to upgrade. The homebuyers in the age range of 65 to 75 purchased homes with an average size of 1800 square feet, which is about 220 square feet smaller than the home they sold. Buyers paid an average price of $250,000, which is $30,000 more than the home that they sold. This higher purchase price is most likely from the profits from the sale of their previous home.
- The popularity of starter homes has diminished. When millennials buy a home, they are not looking at the traditional, smaller starter homes. The younger generation paid a median of $217,000 for an 1800 square foot home. This is the same average price that older buyers purchase at.
- The first bidding war is usually lost by buyers. There is a shortage of homes listed for sale and this means that most buyers lose out on their first bid. Only 46 percent of buyers get the first home that they make an offer on. This is largely why a home search now takes an average of 4.2 months.
- The younger buyers still enjoy buying in the suburbs. Most professionals assume that millennials dislike the suburbs, but this is not the case. Almost half of the homeowners in this age bracket live in the suburbs, which is a sign that the times of living in a cul-de-sac is not over.
The report by Zillow had some very unique findings, but it all points to signs that the housing market is moving into new directions.