For most home buyers, the purchase of real estate is one of the largest financial transactions they will make. Buyers purchase a home not only for the desire to own a home of their own, but also because of changes in jobs, family situations, and the need for a smaller or larger living area. This annual survey conducted by the NATIONAL ASSOCIATION OF REALTORS® of recent home buyers. Created 2020
Characteristics of Home Buyers
- First-time buyers made up 31% of all home buyers, a dip from last year’s 33%.
- The typical buyer was 47 years old this year, and the median household income for 2019 rose again this year to $96,500.
- 12% of home buyers purchased a multi-generational home, to take care of aging parents, because of children over the age of 18 moving back home, and for cost-saving.
- 18% of recent home buyers were veterans and 2% were active-duty service members.
Characteristics of Homes Purchased
- Most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or electricity at 44%. Buyers who purchased previously-owned homes were most often considering a better overall value at 35%.
- Home prices increased slightly this year to a median of $272,500 among all buyers. Buyers typically purchased their homes for 99% of the asking price.
- The typical home that was recently purchased was 1,900 square feet, had three bedrooms and two bathrooms, and was built in 1993.
- Heating and cooling costs were the most important environmental features for recent home buyers, with 83% ﬁnding these features at least somewhat important.
The Home Search Process
- For 43% of recent buyers, the ﬁrst step that they took in the home buying process was to look online at properties for sale, while 18% of buyers ﬁrst contacted a real estate agent.
- Buyers typically searched for eight weeks and looked at a median of 9 homes and viewed 5 of these homes only online.
- The share of home buyers who used the internet to search for a home increased to an all-time high of 97%.
- 64% of recent buyers were very satisfied with their recent home buying process.
Home Buying and Real Estate Professionals
- 88% of buyers recently purchased their home through a real estate agent or broker, and 6% purchased directly from a builder or builder’s agent.
- Having an agent to help them ﬁnd the right home was what buyers wanted most when choosing an agent at 51%.
- 73% of buyers interviewed only one real estate agent during their home search.
- 91% of buyers would use their agent again or recommend their agent to others.
Financing the Home Purchase
- 87% of recent buyers ﬁnanced their home purchase. Those who ﬁnanced their home purchase typically ﬁnanced 88%.
- First-time buyers who ﬁnanced their home typically ﬁnanced 93% of their home compared to repeat buyers at 84%.
- For 58% of buyers, the source of the downpayment came from their savings. 38% percent of buyers cited using the proceeds from the sale of a primary residence, which was the next most commonly reported way of securing a downpayment.
Home Buyers Before and During COVID-19
- Buyers who purchased after March were more likely to purchase a multi-generational home at 15% compared to 11% who purchased before April.
- Buyers who purchased after March have a shorter expected tenure in the home they purchased, just 10 years compared to those who purchased before the pandemic who expect to own their home for 15 years.
- 57% of buyers who purchased during the pandemic purchased in a suburban location, compared with 50% of pre-pandemic buyers.
- Buyers who purchased during the pandemic purchased a home that typically was $339,400 compared to pre-pandemic buyers who purchased a home that was $270,000. 23% of buyers who purchased after March purchased a home that was $500,000 or more.