Anyone who reads my blog regularly knows I am a bit of a statistics junkie. Being an ex-physicist, I guess it comes with the territory. What I like about numbers, when added to the nearly 30 years experience I have selling real estate it really does give me a true sense of what is happening today. But more importantly, it helps me understand the changes in the market and gives me insight into the future.
I am not saying I can tell you what will happen to the value of your home, but I sure can tell you what has happened in the past and together we can make the most intelligent estimate as to what the price may be when you go to sell in the future.
Below are some excerpts from the latest California Association of Realtors 2013 Home Buyer Survey. This is the longest running such survey that I have seen in my time in real estate and it always contains insights into the latest trends. If you would like a copy of the entire report, please email me and I will be happy to send it to you.
Let me put my nearly 30 years experience to work for you and help you find the perfect Napa Valley property, please contact me
Virtually all home buyers use the internet in the home buying process and seven out of 10 access the internet on their phones. Buyers use their smartphones to look for comparable house prices, search for properties, take photos and create videos of homes and amenities, research communities and real estate agents.
While the majority of buyers (61 percent) found their home through an agent, the percentage who found their home online more than doubled from 16 percent in 2012 to a record high 37 percent in 2013. Realtor.com remained the most useful website for buyers and also where many found their home. Social media use in the home buying process continued to increase with three-quarters of buyers now using it and 91 percent being receptive to receiving information about the process through it.
The survey also found that buyers are spending nearly six months on average considering a purchase before contacting an agent, nearly twice as long as last year when they only spent about three months thinking about buying. Furthermore, they are taking their time investigating homes and neighborhoods before contacting an agent, spending a little over seven months on this compared to about 1.5 months last year. Buyers in general spent almost 10 weeks looking for a home with their agent, a week longer than last year. More than eight out of every 10 buyers (85 percent) made offers on homes other than the one they purchased and one-third claim they settled for the best option given the limited supply of houses. The lengthier consideration time and home search reflect the limited availability of homes for sale and the increasing prices, which are causing buyers to weigh their options more carefully.
Buyer optimism about the future direction of home prices is growing; with the majority of buyers (60 percent) believing prices will go up in five years and 36 percent believing prices will rise in one year.
Buyers cited price decreases (38 percent), favorable prices/financing (12 percent), and the desire for a better location (10 percent) as reasons for purchasing a home.
Continuing the struggle with tight lending standards, buyers experienced extreme challenges in obtaining financing. On a scale of one to 10, with 10 being extremely difficult, buyers rated their difficulty in obtaining financing at 8.6 on average, the highest in the Survey’s history.
Higher down payments are the norm for the market these days, with buyers putting an average of 25 percent down on their home purchase. The average down payment has been higher than the traditional 20 percent since 2009, when the question was first asked.
Ninety-one percent of buyers obtained a fixed-rate loan, up from 84 percent in 2011, reflecting buyers’ need for certainty as the market gets back to basics.