With prices attractive and interest rates still historically low, it’s not just a tagline that now is a great time to buy, especially for younger households. But NAR’s recently released 2012 Home Buyer and Home Seller Survey shows that younger households are struggling to get in at this advantageous time. Instead, we’re seeing a strengthening in the older, married, higher-income, move-up buyer market, and the reason appears very much related to the biggest housing policy challenge facing the federal government today: getting banks to return underwriting standards to the safe and reasonable standards they employed prior to the housing boom.
Jessica Lautz of NAR Research at the 2012 REALTORS Conference & Expo in Orlando last week walked the press through the latest survey findings and they were striking: a drop in the young, single female buyers who had been growing into such an important part of the market in the last several years, first-time buyers still trying to come back to historically normal levels, big gains by older, married, move-up buyers, including those who already own a second home.
What the trends suggest is the restrictive mortgage environment is making it hard for younger buyers to get into the market, leaving a good share of it to more established households, including those with two incomes.
Another interesting tidbit Lautz pulled out of the report, which is always among the most popular pieces of research NAR puts out for its members, is the disappearing FSBO. It’s a trend NAR has been seeing for a while. Sellers trying to go it alone in today’s tough market are just not faring well, and their numbers continue to dwindle.
By Robert Freedman, Senior Editor, REALTOR® Magazine
Sales might be down for many of you but so is the competition from FSBOs. An analysis of buyer and seller data that NAR collects annually shows a fairly dramatic drop in for-sale-by-owner transactions over the last two decades.
In 1991, 19 percent of sellers, or almost one in five, sold their home as a FSBO, and 77 percent retained the help of an agent. In 2010, fewer than 10 percent sold as a FSBO and 88 percent, or almost nine in 10 sellers, worked with an agent. That’s a 14 percent increase in favor of agents over that 19-year period.
You might expect FSBOs to go down since the tough market began several years ago, but the trendlines have been heading south for far longer than the downturn, suggesting other factors at work. Continue reading »