Jessica Lautz is the Vice President of Demographics and Behavioral Insights at the National Association of REALTORS®. Jessica started at NAR in 2007. The core of her research focuses on demographic trends for both NAR members and housing consumers. Jessica discussed the results of these studies with the Eastern Connecticut Association of Realtors at the Mystic Marriott on February 14, 2019.
Demographics & Behavior Insights Research
Minorities are growing
Millennials (23-38) outnumber Boomers (60+)
There is a noticeable drop in Marriage Rates
Long Life Spans – what are we going to do about inventory? Is aging in place a problem for inventory?
Rise in household Income Successful Buyers
2002 – 74,000 2018 100,000
First time buyers remain suppressed. Median age of first time home-buyers is 32, repeat buyer is about 55.
First time home buyers not married number about 54%. Includes unmarried, unromantic roomies sharing a home or apartment.
Buyers are skipping the baby. In Japan more adult diapers are sold than baby diapers. Birthrates are the lowest in 30 years. Child care is very expensive. People want more time for the children they already have. Some people are worried about the economy. Some others feel they cannot afford children.
Some buyers care more about their pets when choosing a place to live. Proximity to parks and veterinarians is a priority. Solar panel dog houses are available as are fitbits monitoring water intake and steps taken by pets.
Inventory of 3BR and 2 bath single family homes in suburbs and small towns is low. People want a short commute and to be close to friends and family.
The 1920’s and 1940’s also had a resurgence of adult children returning home to live. Right now 1 in 5 younger boomers now live in a multi-generational home.
The expected tenure median years has grown from 6-9 years to 10-15 years. Millennials are skipping the first home.
There is a down-payment knowledge gap: 87% of potential home buyers think 10% or more of a down-payment is needed when only 7% is more accurate. Saving for a down-payment has become increasingly difficult due to credit cards, student loans, car loans etc. Student loan debt has climbed to $1.5 Trillion.
When the job market was tight many people went back to school to improve their resumes but they also took on a whole lot of debt. Median Student Loan Debt is $41,200 while Median Income is $38,000.
Among owners there are many reasons for not selling, it is too expensive, their mortgage is under water, or it is just too much work.
If you are already an owner-millennial, you probably bought your home before getting a college degree, bought with family help, or sacrificed location and quality.
Buyer use of Agents is near all-time high at 87%. Millennials are not a DIY generation, they are a mom and dad help me generation. Agent assisted sales are at an all time high of 91% compared to 1985 when 15% of sales were FSBO, For Sale By Owner.
Business Activity for Real Estate breaks down this way: 17% Referrals for part-time agents, while referrals make up 72% where Real Estate is the agent’s only business. Realtors really believe in their business as 87% own one or more homes.
In Connecticut $83,795 is the total economic impact of selling a home when you consider all of the industries that go into a home sale from painters and re-modelers to closing.