Buyers who bought during the onset of COVID-19 were more likely to have higher household incomes, buy at higher price points, and buy a multi-generational home, according to the 2020 Profile of Home Buyers and Sellers recently released by the National Association of Realtors® (NAR).
NAR’s annual survey went to those who bought homes between July 2019 and June 2020, which encompasses several months impacted by COVID-19 prevalent since March 2020.
The report delves into lifestyle and other factors that contribute to home buying and selling decisions, including the desire for home ownership and changes in jobs and family. Following are select highlights of the Colorado statistics gathered from the report.
Home buyer characteristics
• Typical Colorado buyers are 47 years old with a median income of $108,800 which is 12% above the $96,500 median income of typical buyers nationwide.
• Twenty-five percent of all buyers are first-time buyers.
• Married couples make up 67% of recent buyers, 15% were single females, 9% single males, and 7% unmarried couples.
• Multi-generational homes were purchase by 11% of home buyers. The homes were selected to provide space to care for or spend more time with aging parents, make room for adult children moving home, or for cost savings.
• For 25% of recent homebuyers, the primary reason for purchasing a home was the desire to own a home of their own.
• 25% of homes purchased were new and 75% were previously owned. Thirty-six percent of new home buyers wanted to avoid renovations and problems with plumbing or electricity and 35% of previously owned home buyers were looking for better value.
• The most common home type purchased – 84% – was a detached single-family home while 6% of recent home buyers purchased senior-related homes.
• A median of 15 miles lay between the home purchased and the home moved away from, and buyers expect to live in their home for a median of 15 years.
• Median home price in Colorado was $411,000 and buyers paid 100% of the asking price, compared to a nationwide median of $272,500.
• The typical home was 2,230 square feet and built in 2005.
Home search process
• 38% of recent buyers first looked online at homes for sale while 24% contacted a real estate agent first.
• Most found Realtors and online search very useful in the home search process with 83% noting real estate agents and 74% noting mobile and tablet search devices.
• Buyers searched for eight weeks and looked at 10 homes, three of which were solely online.
Home buying and real estate professionals
• 86% of recent buyers purchased through a real estate agent and 56% most wanted their agent to help them find the right home.
• 38% used an agent referred by a friend, neighbor or relative and 74% interviewed only one real estate agent during their home search.
• 92% of buyers would use their agent again or recommend their agent to others.
Financing the Home Purchase
• 87% of recent buyers financed their home purchase and typically financed 86% of the purchase price. First-time buyers who financed their home typically financed 95% of their home purchase compared to repeat buyers at 81%.
• 53% used savings for the down payment, 48% used proceeds from a primary residence sale, and 13% found the most difficult step in the home buying process was saving for a down payment.
• 91% believe a home purchase is a good investment.
Home sellers and their selling experience
• Home sellers most often cited their reason for selling as the desire to move closer to friends and family (16%), followed by a change in family situation (14%), and job relocation (13%).
• Sellers typically live in their home for 10 years before selling.
• 92% worked with a real estate agent to sell their home and sales price was 99% of the final listing price. Homes were on the market for a median of two weeks.
• Colorado home sellers said they sold their homes for a median of $48,500 more than the purchase price. Nationwide, sellers reported selling for $66,000 more.
Data for the 2020 Profile of Home Buyers and Sellers was gathered from a 131-question survey using a random geographically weighted sample mailed by NAR to 132,550 recent home buyers. The statistics here are taken from the responses from Colorado residents. Information is characteristic of the 12-month period ending June 2020, with the exception of income data, which are reported for 2019.
• See the full report at coloradorealtors.com/wp-content/uploads/2021/02/Colorado-Profile-of-Home-Buyers-and-Sellers.pdf.
By Tom Kalinski. Tom is the broker/owner of RE/MAX of Boulder, the local residential real estate company he established in 1977. He was inducted into Boulder County’s Business Hall of Fame in 2016 and has a 40-year background in residential and commercial real estate. For questions, e-mail firstname.lastname@example.org, call 303.441.5620 or visit boulderco.com.