Table of Contents
Executive Summary
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- Overview
- Themes
- Tap into the entrepreneurial spirit
- Agent relationships can go beyond the purchase
- Show consumers it can be easy to save
- What it means
The Market – What You Need to Know
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- Home ownership rate remains relatively consistent
- Mortgage debt nears $10 trillion, while total debt crosses $13 trillion
- Majority of US consumers own their home
- Just more than half of home buyers are first-timers
State of the Housing Market
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- Home ownership rate remains relatively consistent
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- Figure 1: Total US homeownership rate, 2000-18
- New home sales rebounding from 2008 crash
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- Figure 2: Total US single-family new home* sales, 2007-18
- Housing starts on the rise
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- Figure 3: Total new privately owned housing units started, monthly, January 2007-March 2019
- Existing-home sales down year over year
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- Figure 4: Seasonally-adjusted total existing-home sales, March 2018-March 2019
- Median new home prices remain over $300K, existing tops $250K
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- Figure 5: Median sales prices of new houses sold in the United States, January 2007-March 2019
- Figure 6: Median sales prices of existing homes sold in the United States, March 2018-March 2019
Market Factors
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- Mortgage debt nears $10 trillion…
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- Figure 7: Mortgage debt*, 2007-18
- …while total debt crosses $13 trillion
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- Figure 8: Mortgage share of total debt, 2007-18
- Stable job market helps create optimistic housing market
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- Figure 9: Unemployment and underemployment, January 2009-February 2019
- DPI is up year over year
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- Figure 10: Disposable Personal Income change from previous period, January 2009-January 2019
- Median household income
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- Figure 11: Real median US household income, 2000-17
- Figure 12: Median household income, by type of household, 2017
- Total household size on the rise, but not with children
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- Figure 13: Households, by presence of own children, 2008-18
Home Buyer Consumer Breakdown
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- Market shows equal amount of new and experienced home buyers
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- Figure 14: Consumers who bought a home in the last 12 months, Fall 2010-Fall 2018
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- Figure 15: Consumers who plan to buy a home in the next 12 months, Fall 2010-Fall 2018
- Just more than half of home buyers are first-timers
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- Figure 16: First-time versus experienced home buyers, March 2019
- Nearly two thirds of US consumers own their home
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- Figure 17: Primary residence – owned, March 2019
- Consumers 25+ are most likely to own their home
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- Figure 18: Primary residence – owned, March 2019
- Home purchase involvement still divided on gender lines
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- Figure 19: Primary decision-maker versus joint, March 2019
Market Highlight: Impact of Moving
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- Rental market remains mainly in condos/apartments
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- Figure 20: Primary residence – rented, March 2019
- Movers significantly more likely to make home-related purchases
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- Figure 21: Furniture or appliances purchased in the last 12 months, by home buyer status, November 2018
Key Players – What You Need to Know
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- Becoming the Amazon of Home Sales
- The end of the starter home?
- Niche home sales
What’s Happening
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- Traditional versus online home buying
- Traditional
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- Figure 22: RE/MAX TV commercial – “Tools”
- Online
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- Figure 23: Redfin TV commercial – “Things You Don’t Do anymore”
- Zillow to offer in-site mortgages
- Mortgage applications rise year over year, but buyers worry about interest rates
What’s Struggling
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- The end of the starter home?
- Inequality in home lending
- Home Loan Quality Transparency Act
- Non-White consumers declined home loans at higher rates than White consumers
What’s Next
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- Companies to target niche home buyers
- Buying and selling – all online
- Opendoor
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- Figure 24: Opendoor Facebook post, “How Opendoor’s costs compare to a traditional home sale”, April 2019
- Perch
Trend in Lending: Quick-to-Close Mortgages
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- Loans are becoming more efficient
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- Figure 25: BB&T Home Mortgage direct mail, September 2018
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- Figure 26: SoFi Home Mortgage direct mail, January 2017
The Consumer – What You Need to Know
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- Savings, renovation top list for most important priorities
- Home buyers likely to consider either previously owned or new
- Most consumers visit 10 or fewer homes
- Less than half of consumers use a real estate agent to find or purchase a home
- Home ownership still considered a key part of adulthood
- Consumers are struggling to save for a down payment
Lifestyle Priorities
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- Savings, renovation top list for most important priorities
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- Figure 27: Lifestyle priorities, ranked, March 2019
- Younger consumers prioritize finances, employment
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- Figure 28: Lifestyle priorities, any rank, by age, March 2019
- Consumers are struggling to save for a down payment
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- Figure 29: Opinion on saving for down payment, by generation, March 2019
Home Buying Preferences
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- Home buyers likely to consider either previously owned or new
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- Figure 30: Preference for new or previously owned homes, March 2019
- Male homeowners are most interested in new construction
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- Figure 31: Owner preference for new or previously owned homes, by age and gender, March 2019
- Non-owners are equally likely to look for new or previously owned homes
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- Figure 32: Non-owner preference for new or previously owned homes, by generation and geography, March 2019
Number of Homes Visited
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- Most consumers visit 10 or fewer homes
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- Figure 33: Number of homes visited, March 2019
- Higher income households likely to want more selection
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- Figure 34: Number of homes visited, by household income, March 2019
- Online home search may increase number of houses visited
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- Figure 35: Number of homes visited, by online home search preference, March 2019
Home Buying Behaviors
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- Less than half of consumers use a real estate agent to find or purchase home
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- Figure 36: Use of real estate agent or online home search, March 2019
- Millennials rely on agents and internet in home search
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- Figure 37: Use of real estate agent, by generation, March 2019
- First-time home buyers less likely to use agents
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- Figure 38: Use of real estate agent, by home buyer experience, March 2019
- Familial relationships are a strong force in home purchasing
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- Figure 39: Reasons for moving, by parental status, March 2019
Attitudes toward Home Buying
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- Home ownership still considered a key part of adulthood
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- Figure 40: Importance of owning a home, March 2019
- Real estate websites are making the process easier…
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- Figure 41: Interest in online home buying resources, March 2019
- Figure 42: Belief that real estate websites make the home search easier, by household income, March 2019
- …but consumers are looking for online home buying resources
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- Figure 43: Interest in online home buying resources, by home buying experience, March 2019
- Realtor.com’s “Unreal Reality” helps bring consumers back to earth
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- Figure 44: Unreal process – realtor.com, April 2019
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
- Terms
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