According to the National Association of Realtors (NAR), nine out of ten Realtors report their markets are in recovery mode, with some heating up more than a year ago. Insights from recent research conducted by the NAR show some definite changes in the way buyers are responding to home decisions during the global health crisis. Here are seven of the top documented shifts.
1. Buyers Are Making Home Decisions Faster
In 2019, the average buyer viewed nine homes before initiating a purchase contract. This year, buyers are making an offer after viewing the third or fourth home. There’s a greater sense of urgency to make a decision and complete the transaction, particularly in rural areas.
2. Priorities Are Shifting on Buyer Wish Lists
While 65% of Realtors say priorities haven’t changed among buyer wants, the other 35% have noticed a definite shift. Of Realtors surveyed, 24% said buyers must have a home office, sometimes more than one; 15% said buyers need space to accommodate more family—either an older adult, baby, or even a pet; 13% said buyers want more personal space; and 19% said buyers want more yard space for multi-purpose use.
3. Work-from-Home Makes Commuting Less of a Concern
The growth of remote work practices among many companies is having a big effect on housing decisions. Nearly a quarter of 2,300 Realtors surveyed said home buyers who are able to work at least some days from home are less worried about long commutes to the office. The result is an increase in buyers who are more willing to move out from urban areas to suburbs and even rural towns.
4. Interest for Multi-Generational Homes Grows
The multi-generational home was already seeing a bump before COVID-19. But one of the results of the health crisis has been an increased desire to stay close to family and care for elder parents. People are prioritizing the family unit among all generations. This not only means bigger homes, but sizeable space on a first floor so that older adults don’t have to climb steps.
5. Pets Are Helping the Drive of Purchase Decisions
One interesting effect of the pandemic is an increased desire for a family pet. In the NAR’s Pets in Real Estate study, 43% of people surveyed were willing to move to accommodate the needs of a family pet, sighting a desire for a fenced-in yard or more space in general. Having a pet definitely can influence where and when a family chooses to move.
6. We May See a Surge in First-Time Single Buyers
There are a number of behavioral trends that predict a first-time buyer surge among singles. Younger adults are waiting longer to marry, meaning an increase in single professionals buying homes. Unmarried couples buying homes together are now up to 17%. And some singles are pooling their financial resources together to purchase a home together. If single professionals become less tied to metro areas because of remote work growth, they may find greater affordability just outside of cities and flex their purchasing power with more home purchases.
7. Families May Move Sooner from Their Current Home
The average length of time spent in one home increased from around seven years before 2008 to around 13 years in 2018 (NAR American Community Survey, 2018), with variances depending on where one lives. As people spend more time at home because of the pandemic, they’re reassessing their living space and how well it fits their needs. With record-low mortgage rates, increase in remote work, and a desire for more usable space inside and outdoors, we could see people ready to move sooner than the average tenure.
Real Estate Term of the Week
Tenure: In real estate, the holding or occupying of property.