Cookies on the this website
We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on this website. However, if you would like to, you can change your cookie settings at any time.
Continue

New to PropertyWire?

Welcome, and thank you for visiting our website.

PropertyWire is the leading publication for property investors and industry professionals interested in the world of international property investment.

Our aim is to give you intelligent commentary and analysis on the world of retail and commercial real estate.
If you've enjoyed what you've read so far why not sign up for our FREE property alert and online magazine PropertyWire Confidential.

Every week the PropertyWire team sends out a hard-hitting newsletter packed with news and analysis of the top stories plus the best investment opportunities on the market. We always look at the bigger picture like the Euro Crisis, and explain how this will affect YOUR investments.


Ask me later
No thanks

Sat
Apr 19th
Lost Password? Register
Home arrow News arrow North America arrow Dual income households helping US residential market to recover, research shows

Dual income households helping US residential market to recover, research shows

Tuesday, 13 November 2012
Image
Dual income households are comprising a greater portion of the US housing market and helping sales recover, according to an annual study from the National Association of Realtors.

It shows that some 65% of all buyers are married couples, 16% are single women, 9% single men, 8% unmarried couples and 2% other. Percentages of single buyers were slightly higher in 2011.
 
However, just two years ago, 58% of buyers were married, 20% were single women, 12% single men and 7% unmarried couples and the overall market share of single buyers declined by 7% over the past two years. Before 2010, the market shares moved within a very narrow range, generally a percentage point or two.

Paul Bishop, NAR vice president of research, said the study is painting a clearer picture of the impact of mortgage limitations. ‘We’ve known for some time that stringent mortgage credit standards have been holding back home sales, but these findings show single buyers have been hurt the most over the past two years. Total home sales would be 10 to 15% higher without these unnecessary headwinds,’ he explained.

‘The continued growth in married couples as single buyers shrink demonstrates that households with dual incomes are more successful in obtaining a mortgage. However, given the historically favourable housing affordability conditions, most single income buyers could also purchase a home and stay well within their means, if lending requirements were more sensible,’ he added.

First time buyers edged up to a 39% market share in the past year from 37% in the 2011 study. Long term survey averages show that four out of 10 buyers are typically first time buyers, who are critical to a housing recovery because they help existing home owners to sell and make a trade.

The study also shows the median age of first time buyers was 31 and the median income was $61,800. The typical first time buyer purchased a 1,600 square foot home costing $154,100, while the typical repeat buyer was 51 years old and earned $93,100. Repeat buyers purchased a median 2,100 square foot home costing $220,000.

The median down payment for all home buyers was 9%, ranging from 4% for first time buyers to 13% for repeat buyers. ‘First time buyers historically make small down payments, but repeat buyers like to put down 20% if they can to avoid paying mortgage insurance,’ Bishop said.
 
‘The general loss in home value since the peak of the housing boom means many repeat buyers in recent years had to make smaller down payments. Fortunately, prices have turned up this year and are showing sustained increases, so we’re on the road to a recovery in home equity,’ he added.

First time buyers who financed their purchase used a variety of resources for the down payment. Some 76% tapped into savings, 24% received a gift from a friend or relative, typically from their parents and 6% received a loan from a relative or friend.

Some 93% of entry level buyers chose a fixed rate mortgage, 46% of first time buyers financed with a low down payment FHA mortgage, and 10% used the VA loan programme with no down payment requirements.

The research also shows that 42% cut spending on luxury items to buy their first home, 35% cut spending on entertainment and 27% cut spending on clothes.

Overall 78% of recent home buyers said their home is a good investment, 46% believe it’s better than stocks and 92% were satisfied with the buying process.

The typical buyer began their home search online and then contacted a real estate agent.  Buyers who used an agent searched a median of 12 weeks and visited 10 homes, down from 12 homes in 2011.

‘The decline in the number of homes visited reflects a tighter inventory environment that became more pronounced during the second half of the survey period. It makes sense that buyers are seeing fewer homes in the current market,’ said Bishop.

Buyers use a wide variety of resources in searching for a home. Some 90% use the internet, 87% use real estate agents, 53% for sale signs, 45% attend open houses and 27% review print or newspaper adverts.

Also 91% of buyers who used the internet to search for a home purchased through a real estate agent, as did 71% of non internet users, who were more likely to purchase directly from a builder or from an owner they already knew in a private transaction.

While sellers had been in their previous home for a median of nine years, first time buyers plan to stay for 10 years and repeat buyers plan to hold their property for 15 years.

The biggest factors influencing neighbourhood choice were quality of the neighbourhood, cited by 61% of buyers, convenience to jobs at 43%, overall affordability of homes 39% and convenience to family and friends 35%.

Other factors with relatively high responses include neighbourhood design and convenience to shopping, 26% each, quality of the school district 25%, convenience to schools 22% and convenience to entertainment or leisure activities 19%.
Commuting costs continue to factor strongly in decisions regarding location, with 75% of buyers saying transportation costs were important.

Some 79% of respondents purchased a detached single family home, 8% a condo, 6% a town house and 7% some other kind of housing. The typical home had three bedrooms and two bathrooms.

The typical home seller was 53 years old and their income was $95,400. Sellers moved a median distance of 19 miles and their home was on the market for 11 weeks.  Some 46% moved to a larger home, 29% bought a comparably sized home and 25% downsized.

Like sellers, buyers most commonly choose an agent based on a referral, with trustworthiness and reputation being the most important factors. Two out of thee buyers interviewed only one agent and 89% of buyers are likely to use the same agent again or recommend to others.


BOOKMARK THIS PAGE (What is this?)     Digg!Reddit!Del.icio.us!Google!Live!Facebook!StumbleUpon!Newsvine!Furl!Yahoo!

 
More Recent News
Earlier News
To see all the latest news articles in our monthly online magazine, Property Wire Confidential, sign up free here






West Tower

West Tower

Car park

home rental guide

West Tower

John Charles

Buy-to-let

North America: Top Headline

US sellers advised to spruce up the outside of their properties for a fast saleUS sellers advised to spruce up the outside of their properties for a fast saleHome owners in the United States putting their properties on the market should focus on making them look good on the outside rather than undertake large scale renovations, a survey has found.

Search for Properties:

Feature story

Student accommodation investment check List

It’s the UK’s strongest asset class, but are all student accommodation properties good investments? This is the comprehensive list of what to watch out for when buying student property.

 

Company news

LOOK TO THE UK FOR AN EDUCATED PROPERTY INVESTMENT

In the past year, overseas investment in the UK has been steadily rising in all markets according to official figures. For example, the UK Trade & Investment (UKTI) reported in July 2013 that the UK is the leading European destination for foreign direct investment (FDI).

Finance Update

Buy to let lifetime tracker products launched

Specialist buy to let mortgage lender, Paragon Mortgages, has launched a range of lifetime tracker products along with refreshing the rest of its range of fixed and tracker buy to let mortgages.

Features

Student accommodation investment check List

It’s the UK’s strongest asset class, but are all student accommodation properties good investments? This is the comprehensive list of what to watch out for when buying student property.

 

Newsletter

Subscribe to our weekly newsletter and stay updated on the property market trends.
Subscribe now >>

Subscribe to our North American property and real estate news feed (RSS)