2016 NAR PROFILE OF HOME BUYERS AND SELLERS
This summer, the National Association of Realtors (NAR) surveyed 5,465 home buyers and sellers for the 2016 National Association of Realtors® Profile of Home Buyers and Sellers. The study shows that in the past five years, affordability has tightened, and the time spent home shopping has fallen.
How much faith do home buyers have in their investment, and is that faith on the decline or improving? Why are people moving, and what factors influence those choices? Let’s dig a little bit deeper.
Are stocks or homes the better investment?
Fully 82 percent of home buyers surveyed opined that buying a home is a good investment, up 2.0 percent in one year. Nearly half (47 percent) believe owning a home is a better investment than buying stocks (up 2.0 percent from 2011).
One in three home buyers cite a desire to own as one of their biggest reasons to purchase a home (31 percent in 2016, up 4.0 percent in five years). The desire among first time buyers as a primary reason to buy is 67 percent (up from 60 percent in 2011).
The attraction to homeownership is the biggest reason to buy, but there are others. Below are the second through sixth place reasons (versus 2011):
- 10 percent move to obtain a larger home (unchanged).
- 8.0 percent move due to a change in family situation (unchanged).
- 8.0 percent move for a job relocation (down 2.0 percent).
- 7.0 percent move to be closer to friends or family (unchanged).
- 3.0 percent cited affordability as a primary driver (down 5.0 percent).
What factors influence home buyers’ choices?
The report indicates that the primary factors influencing choice in 2016 (versus 2011) are:
- 60 percent chose based on neighborhood (down from 67% in 2011).
- 43 percent wanted convenience to their jobs (down from 49 percent).
- 37 percent said convenience to family and friends (down from 39 percent).
- 20 percent were influenced by neighborhood design (down from 32 percent).
- 24 percent said convenience to shopping (down from 28 percent).
- 26 percent focused on the quality of the school districts (down from 25 percent).
- 20 percent wanted convenience to schools (down from 22 percent).
- 20 percent said convenience to entertainment (down from 21 percent).
If you’re marketing to buyers, knowing what makes them tick can help your team to get ahead. While trends locally are still the most relevant to any broker or agent’s career, knowing the national trends can help pinpoint adjustments that should be made locally, or affirm decisions already being made.
The practice of real estate is changing given these rapidly altered circumstances surrounding home buyers and sellers, and it is important to be informed!