As the housing market has continued its recovery in 2015, a new report from the National Association of Realtors (NAR) shows that the gains are being built on the backs of repeat homebuyers.
In the “2015 Profile of Home Buyers and Sellers,” NAR reported that the share of first-time homebuyers fell a point to 32 percent, the lowest mark since 1987, when it was at 30 percent.
“As the share of repeat buyers continues to rise, the number of married couples increases and the income of homebuyers purchasing homes is higher,” the report stated. “Married couples have double the buying power of single homebuyers in the market and may be better able to meet the price increases of the housing market.”
Existing home sales accounted for 84 percent of the market in 2015, a fact that the report said could be attributed to available sales.
“Tightened inventory is affecting the home search process of buyers,” it stated. “Due to suppressed inventory levels in many areas of the country, buyers are typically purchasing more expensive homes as prices increase.
“Buyers continue to report the most difficult task for them in the homebuying process is simply finding the right home to purchase.”
Another sign of the seller-focused market came in the home prices found in the report. The median home price increased slightly to $220,000, but as importantly, buyers typically purchased homes for 98 percent of the asking price.
“Increased prices are also impacting sellers,” the report said. “Tenure in the home had risen to a peak of 10 years, but in this year’s report it has eased back to nine years. Historically, tenure in the home has been six to seven years. Sellers may now have the equity and buyer demand to sell their home after stalling or delaying their home sale.”
The typical home bought in 2015 was built in 1991, was 1,900 square feet, with three bedrooms and two bathrooms, again reinforcing the idea of families and couples leading the homebuying process. In addition, 13 percent of buyers said they purchased a multi-generational home to take care of aging parents, grown children, and to save money.
On the sellers side, most sellers said they put their homes on the market because they were too small (16 percent), with job relocation (14 percent) and a desire to live closer to family and friends (13 percent) as other top reasons. The typical seller was age 54, and only 8 percent said they sold their homes themselves, the lowest mark since the report started in 1981.