2015 Profile of Home Buyers and Sellers Highlights

National Association of REALTORS
2015
PROFILE OF HOME BUYERS
AND SELLERS
The Voice for Real Estate
2015 OFFICERS
NAR RESEARCH STAFF
President
Chris Polychron, CIPS, CRS, GRI
Lawrence Yun, Ph.D.

Chief Economist and Senior Vice President
President-Elect
Tom Salomone
Caroline Van Hollen

Senior Research and Strategic Planning Coordinator
First Vice President

Bill Brown
Treasurer
Michael McGrew, CRB, CRS
Immediate Past President
Steve Brown, ABR, CIPS, CRS, GREEN
Vice President
Charlie Oppler, AWHD
Vice President
Mike Ford, GRI
Chief Executive Officer
Dale Stinton, CAE, CPA, CMA, RCE
Paul C. Bishop, Ph.D.

Vice President
Stephanie Davis
Administrative Coordinator
Ken Fears
Director, Regional Economics and Housing Finance
George Ratiu
Director, Quantitative and Commercial Research
Danielle Hale
Managing Director, Housing Research
Scholastica Cororaton
Research Economist
Michael Hyman
Research Data Specialist
Hua Zhong
Data Analyst
Nadia Evangelou
Research Economist
Jessica Lautz
Director, Survey Research and Communications
Meredith Dunn
Research Communications Manager
Brandi Snowden
Research Survey Analyst
Amanda Riggs
Research Survey Analyst
2015
PROFILE OF HOME BUYERS
AND SELLERS
2015 National Association of REALTORS
National Association of REALTORS | PROFILE OF HOME BUYERS AND SELLERS 2015
Contents
Introduction................................................................................................................................... 5
Highlights....................................................................................................................................... 6
Chapter 1: Characteristics of Home Buyers........................................................................... 8
Chapter 2: Characteristics of Homes Purchased...............................................................24
Chapter 3: The Home Search Process..................................................................................45
Chapter 4: Home Buying and Real Estate Professionals..................................................59
Chapter 5: Financing the Home Purchase............................................................................73
Chapter 6: Home Sellers and Their Selling Experience................................................... 86
Chapter 7: Home Selling and Real Estate Professionals.................................................106
Chapter 8: For-Sale-by-Owner (FSBO) Sellers.................................................................. 115
Methodology............................................................................................................................. 126
List of Exhibits........................................................................................................................... 127
Introduction
uying a primary residence for home buyers is a major

financial decision but also an emotional decision that
involves many lifestyle factors. For most home buyers,
the purchase of a primary residence 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 and sellers helps to gain insight into detailed information about their unique experience with this transaction.
The information provides understanding, from the consumer
level, of the trends that are transpiring. The survey covers information on demographics, housing characteristics, and the
experience of consumers in the housing market. Buyers and
sellers also provide valuable information about the role that
real estate professionals play in home sales transactions.
Demographics continue to shift as the share of first-time
home buyers dropped further from last years report to 32
percent of the market. This is second only to the lowest share
reported in 1987 of 30 percent. Last years report had a share
of first-time buyers of 33 percent. First-time home buyers are
traditionally more likely to be single male or female home
buyers and traditionally have lower incomes. As the share of
repeat buyers continues to rise, the number of married couples
increases and the income of home buyers purchasing homes
is higher. Married couples have double the buying power of
single home buyers in the market and may be better able to
meet the price increases of the housing market.
Tightened inventory is affecting the home search process

of buyers. Due to suppressed inventory levels in many areas
of the country, buyers are typically purchasing more expensive
homes as prices increase. The number of weeks a buyer is
searching for a home remained at 10 weeks. Buyers continue
to report the most difficult task for them in the home buying
process is simply finding the right home to purchase.
Increased prices are also impacting sellers. Tenure in the
home had risen to a peak of 10 years, but in this years 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.
Buyers need the help of a real estate professional to find the
right home for them, negotiate the terms of the sale, and assist
with price negotiations. Sellers, as well, turn to professionals
to help market their home to potential buyers, sell within a
specific timeframe, and price their home competitively. ForSale-By-Owner (FSBO) sales have dropped to the lowest level
recorded in this survey at eight percent of sales, while the use
of the agent to sell the home stays at historic highs. Likewise,
buyers use of the agent is at historic highs as buyers purchasing directly from a previous owner or through a builder falls.
This report provides real estate professionals with insights
into the needs and expectations of their clients. What do consumers want when choosing a real estate professional? How
do home buyers begin the process of searching for a home?
Why do some sellers choose to forego the assistance of an
agent? The answers to these questions, along with other findings in this report, will help real estate professionals better
understand the housing market and also provide the information necessary to address the needs of Americas real estate
consumers.
Jessica Lautz
Meredith Dunn
Amanda Riggs
Brandi Snowden
November 2015

2015 PROFILE OF HOME BUYERS AND SELLERS
Highlights
Characteristics of Home Buyers
Heating and cooling costs were the most important environmental features for recent home buyers, with 84 percent
finding these features at least somewhat important.
Overall, buyers expect to live in their homes for a median of
14 years, while 23 percent say that they are never moving.
First-time buyers made up 32 percent of all home buyers,

down from 33 percent last year.
The typical buyer was 44 years old, and had a median

household income of $86,100.
Sixty-seven percent of recent buyers were married couples,

15 percent were single females, nine percent were single
males, and seven percent were unmarried couples.
The Home Search Process
Thirteen percent of home buyers purchased a multi-generational home to take care of aging parents, for cost savings,
and because children over the age of 18 are moving back
home.
Ninety percent of recent home buyers identified as heterosexual, three percent as gay or lesbian, one percent as bisexual, and seven percent preferred not to answer.
Eighteen percent of recent home buyers are veterans and

three percent are active-duty service members.
At 30 percent, the primary reason for purchasing a home

was the desire to own a home of their own.
For 42 percent of recent buyers, the first step that they took
in the home buying process was to look online at properties
for sale, while 14 percent of buyers first contacted a real estate agent.
Seventy-eight percent of recent buyers found their real estate agent to be a very useful information source. Online
websites were seen as a very useful information source at
82 percent.
Buyers typically searched for 10 weeks and looked at a median of 10 homes.
The typical buyer who did not use the Internet during their
home search spent only five weeks searching and visited
five homes, compared to those who did use the Internet and
searched for 10 weeks and visited 10 homes.
Among buyers who used the Internet during their home

search, 87 percent of buyers found photos and 84 percent
found detailed information about properties for sale very
useful.
Fifty-nine percent of recent buyers were very satisfied with

their recent home buying process, up from 56 percent a year
ago.
Characteristics of Homes Purchased

n
Buyers of new homes made up 16 percent and buyers of previously owned homes made up 84 percent.
Most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or
electricity at 34 percent. Buyers who purchased previously
owned homes were most often considering a better price at
32 percent.
Detached single-family homes continue to be the most

common home type for recent buyers at 83 percent, followed by seven percent of buyers choosing townhomes or
row houses.
Senior related housing increased this year to 14 percent,

with buyers typically purchasing detached single-family
homes.
There was only a median of 14 miles between the homes

that recent buyers purchased and the homes that they
moved from.
Home prices increased slightly this year to a median of

$220,000 among all buyers. Buyers typically purchased
their homes for 98 percent 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 1991.
Home Buying and Real Estate Professionals

n
Eighty-seven percent of buyers recently purchased their

home through a real estate agent or broker, and eight percent purchased directly from a builder or builders agent.
Having an agent to help them find the right home was most
important to buyers when choosing an agent at 53 percent.
Forty-one percent of buyers used an agent that was referred

to them by a friend, neighbor, or relative.
Nearly seven in ten buyers interviewed only one real estate

agent during their home search.
n Eighty-eight
percent of buyers would use their agent again

or recommend their agent to others.
Highlights
n
Eighty-six percent of recent buyers financed their home purchase. Those who financed their home purchase typically
financed 90 percent.
This year, home sellers cited that they sold their homes for a
median of $40,000 more than they purchased.
Sixty-one percent of sellers were very satisfied with the selling process.
First-time buyers who financed their home financed 94 percent of their home compared to repeat buyers at 86 percent.
Home Selling and Real Estate Professionals
For 60 percent of buyers, the source of their downpayment

came from their savings. Thirty-eight percent of buyers cited using the proceeds from the sale of a primary residence
was the next most commonly reported way of financing a
home purchase.
Financing the Home Purchase

n
Forty-six percent of buyers saved for their downpayment for

six months or less.
The most difficult step in the home buying process was saving for a downpayment, as cited by 13 percent of respondents.
Of buyers who said saving for a downpayment was difficult,

51 percent of buyers reported that student loans made saving for a downpayment difficult. Forty-seven percent cited
credit card debt, and 35 percent cited car loans as also making saving for a downpayment hard.
Buyers continue to see purchasing a home as a good financial investment. Eighty percent reported they view a home
purchase as a good investment.
Home Sellers and Their Selling Experience
Seventy-two percent of recent sellers contacted only one

agent before finding the right agent they worked with to sell
their home.
Ninety-one percent of sellers listed their homes on the Multiple Listing Service (MLS), which is the number one source
for sellers to list their home.
n Agents
receive their compensation predominantly from

sellers at 76 percent.
The typical seller has recommended their agent once since

selling their home. Thirty-two percent of sellers recommended their agent three or more times since selling their
home.
Eighty-four percent said that they would definitely (67 percent) or probably (17 percent) recommend their agent for
future services.
For-Sale-by-Owner (FSBO) Sellers

n
Only eight percent (down from nine percent) of recent

home sales were FSBO sales. This is the lowest share recorded since this report started in 1981.
The median age for FSBO sellers is 54 years. Seventy-seven

percent of FSBO sales were by married couples that have a
median income of $104,100.
FSBOs typically sold for less than the selling price of agentassisted homes; FSBO homes sold at a median of $210,000
(up from $208,700 the year prior), yet lower than the median of all homes at $245,000.
FSBO homes sold more quickly on the market than agentassisted homes. All FSBO homes typically sold in less than
two weeksoften because homes are sold to someone the
seller knows.
The typical home seller was 54 years old, with a median

household income of $104,100.
For all sellers, the most commonly cited reason for selling
their home was that it was too small (16 percent), followed
by a job relocation (14 percent), and the desire to move
closer to friends and family (13 percent).
Sellers typically lived in their home for nine years before

selling, declining from 10 years in last years report.
Eighty-nine percent of home sellers worked with a real estate agent to sell their home.
For recently sold homes, the final sales price was a median
98 percent of the final listing price.
Recently sold homes were on the market for a median of

four weeks.
Seventy percent of successful FSBO sellers were satisfied

with the process of selling their home.
Thirty-seven percent of all sellers offered incentives to attract buyers.
Nine in 10 FSBO sellers who both knew and did not know the
buyer were satisfied with the home selling process.

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National Association of REALTORS

The Voice for Real Estate

NAR RESEARCH STAFF

Lawrence Yun, Ph.D.

Caroline Van Hollen

First Vice President

Paul C. Bishop, Ph.D.

National Association of REALTORS

National Association of REALTORS

2015 National Association of REALTORS

National Association of REALTORS | PROFILE OF HOME BUYERS AND SELLERS 2015

National Association of REALTORS

National Association of REALTORS | PROFILE OF HOME BUYERS AND SELLERS 2015

National Association of REALTORS

uying a primary residence for home buyers is a major

Tightened inventory is affecting the home search process

National Association of REALTORS | PROFILE OF HOME BUYERS AND SELLERS 2015