25 Jan 5 Surprising Demographic Trends for 2012
The National Association of Realtors’ latest Profile of Home Buyers and Sellers has some unexpected statistics about who is buying and selling in today’s market. Now that the first-time homebuyer tax credits have ended, baby boomers have replaced Gen Y and Gen X as the dominant players in the real estate market.
This year’s profile revealed these surprising statistics:
1. Bottomed out at last. Prices appear to be stabilizing in some areas. This is the first step in climbing out of the rocky bottom we have been in for the last several years.
2. Boomers are the key players. In 2010, due to the first-time homebuyer tax credit, the median age of first-time buyers dropped to 31. In many markets, the number of first-time buyers hovered at the 50 percent level. The smart move in 2011 was to market to Generation Y.
Over the last 12 months, however, there has been a substantial change that can have important ramifications for your business in 2012. In 2011, baby boomer purchases substantially surpassed the number of Generation Y buyer.
Why is this surprising? There are more Gen Yers than there are boomers. Generation Y is also at its peak buying age – marrying, establishing new households, and having children.
Furthermore, boomers are actively driving the second-home market. As a result, it may be smart to revisit your business plan for 2012 and to place more emphasis on working with boomers who are currently the dominant players in terms of purchasing.
3. More buyers are using agents. 89 percent of buyers purchased their home through a real estate agent or broker – that’s up from 69 percent in 2001. What are some ossible reasons?
Realtors shorten the search process when there are huge amounts of inventory on the market and people are pressed for time. Most likely, though, it’s the difficulty of the loan process both on the buyer’s side in terms of qualifying for a loan, and on the seller’s side based upon the appraisal process that marks the need for realtors.
4. Married couples or single female buyers? The trend since 2001 has been a substantial decline in the share of buyers who were married. From 2001-2008, the number of married couples purchasing homes dropped from 68 percent to 58 percent.
A historically high percentage of Gen Xers are actually unmarried. As a result, the market saw a huge proportion of single female buyers – the smart market niche for 2011.
In 2012, it’s an entirely different story. The number of single female buyers is still relatively high at 18 percent, but that’s the lowest number since 2004 and represents a reversal of a major trend. It’s time to focus on marketing that reaches couples and families in 2012.
5. Life changes drive real estate sales. The primary reason to purchase a home among repeat buyers is often because of life changes: the desire for a larger home, a job relocation or move, desire to be closer to family and friends, or a change in a family situation.
How will you focus on these 5 new developments for 2012 to reach more sales?