This week's edition of the Stowe Reporter featured McKee's monthly real estate article. This month McKee explored first time home buyers. Here's a copy of the article:
First-Time Home Buyers, looking at the facts.
It has been over a year since the expiration of the Home Buyer Tax Credit; it's time to reexamine what statistics make up the current first-time home buyer.
According to Ron Phipps, 2011 National Association of Realtors President, "First-time home buyers fell to a 37 percent market share in the past year from a record high of 50 percent in the 2010 study." This drop off is directly related to the expiration of the home buyer tax credit. Phipps goes on to say "Long-term survey averages show that four out of 10 buyers are typically first-time buyers."
Who are these buyers, how do they purchase and what motivates them?
- Median age of first-time is 31 and median income is $62,400
- 48% are married couples, 23% single women, 15% single male
- 68% have no children, 18% have one child, 11% have two children
- 94% chose a fixed-rate mortgage, 54% financed with low-downpayment FHA mortgage and 6% used a VA loan with no downpayment
- 60% state "desire to own their own home" as their driving factor in purchasing
- 95% stated being able to personalize their own space and growing value over time as the main benefits of homeownership
The majority of first-time buyers' purchase in urban or suburban areas, but there are three other categories where first-time buyers do purchase that apply to the Stowe area.
- 16% purchase in a small town
- 11% in a rural area
- 3% in a resort or recreation area
How do these buyers find the homes they purchase?
- 88% use the Internet
- 87% use a real estate professional
- 55% yard signs (not allowed in Stowe)
- 30% print or newspaper ad
The following is a more in-depth understanding as to where first-time buyers actually identify the home they ended up purchasing.
- 40% used the internet
- 35% used a real estate professional
- 6% from a neighbor, friend or relative
- 5% from home builder
- 2% print or newspaper ad
- Less than 1% from a home book or magazine
While Stowe caters to many different types of purchasers, the fact that the sub $500K price point makes up 55% of the local market, makes it clear first-time buyers remain an important part of the marketplace.
Sources: 2011 National Association of Realtors Profile of Home Buyers and Sellers; Coldwell Banker
To view the article online, click here.