SANTA CLARA, Calif.,
July 17, 2018 /PRNewswire/
-- Low inventory, rising home prices, and higher interest
rates are making it more difficult, but they aren't keeping some
people from closing on a home, according to the results of a survey
released today by realtor.com®, The Home of Home
SearchSM. In fact, 34 percent of those who purchased a
home were unfazed by price and rate hikes, 51 percent didn't pay
above asking, and 42 percent only made one or two offers.
The typical profile of a successful buyer in the first half of
2018 is someone who was in the market for six months or less (61
percent), made four or fewer offers (72 percent), and bought a
three-bedroom, two-bath home. Those that had an easiest time buying
a home were older buyers, above the age of 55 years old, according
to the survey that was conducted earlier this month by Harris
Research and includes online responses from more than 1,000 people
who closed in 2018.
"Successful homebuyers in 2018 have been exceptionally
well-qualified," said Danielle Hale,
chief economist for realtor.com®. "We are seeing the
impact of the inventory crisis in the data, and it's holding back
home sales. While would-be buyers struggle with limited inventory,
rising prices and mortgage rates, those who closed were undeterred
by today's buyer frenzy. This is likely attributed to their
experience, cash, and perhaps the market they've chosen to buy
in."
Rising rates and prices impacted the majority of
buyers
Home prices set new records this spring. Two-thirds
of closers revealed their search was impacted by rising prices or
rates. In fact, 22 percent indicated increased costs forced them to
look for a less expensive home. Nineteen percent said they had to
increase their monthly mortgage budget and the same share said they
had to look in a different neighborhood.
Conversely, 34 percent of those who closed indicated that rising
prices and mortgage rates had no impact on their purchase.
Fifty-four percent of buyers above 55 years old indicated no
impact, while 31 percent of buyers between the ages of 35 and 54
years old, and 23 percent of those 18-34 years old reported
this.
Most closers didn't pay above asking, but put down more than
20 percent
Despite this season's notorious bidding wars, the
majority of successful home buyers, 51 percent, didn't have to pay
more than asking price. In fact, 28 percent of buyers paid less
than asking price and 23 percent paid full asking. This also varied
by age, only 24 percent of those over 55 years old paid over
asking, compared to 59 percent of those 18-34 years old and 56
percent of those 35-54 years old.
Although the majority didn't offer above asking, these
successful buyers were able to entice sellers with cash. Mortgage
data* from the first half of 2018 shows more than 30 percent of
buyers put more than 20 percent down. This data also shows that
larger down payments are more common among older buyers with 22
percent of those aged 18-34, 32 percent of those aged 35-54, and 51
percent of those aged 55 and older putting more than 20 percent
down.
Fast closings with limited number of offers
A large
share of those who bought in 2018 closed very quickly. In fact, 25
percent of respondents started their search and closed within two
months. More than 60 percent closed within six months and only 8
percent took one year or more after starting their search. Older
buyers were more likely to close quickly with 34 percent of those
55-plus closing within two months, compared to 23 percent of
35-54-year-olds and 21 percent of 25-34-year-olds.
Additionally, nearly half of all buyers, 42 percent, were able
close on a home after one to two offers. Fifty-eight percent had to
make three or more offers. Again, older buyers came out on top with
64 percent of those 55-plus making only one or two offers, compared
to 38 percent of those 35-54 years old and 30 percent of
18-34-year-olds. Additionally, one third of 18-54-year-olds had to
make five or more offers.
Checking listings websites and cash are the key to getting
ahead
When buyers were asked about the most effective tactic
they used to get ahead, the No. 1 strategy cited was checking
listings websites everyday, indicated by 30 percent. Twenty-four
percent reported putting more than 20 percent down and the same
share reported using all cash, followed by 20 percent of
respondents who used each of the following tactics: set a price
alert, offered above asking, and used a larger earnest money
deposit.
For more information, please visit:
https://www.realtor.com/research/home-buyers-in-the-most-competitive-market
*Mortgage data is sourced from realtor.com® analysis
of Optimal Blue mortgage origination data.
About realtor.com®
Realtor.com®,
The Home of Home SearchSM, offers the most comprehensive
source of for-sale MLS-listed properties, among competing national
sites, and access to information, tools and professional expertise
to help people move confidently through every step of their home
journey. It pioneered the world of digital real estate 20 years
ago, and today is the trusted resource for home buyers, sellers and
dreamers by making all things home simple, efficient and enjoyable.
Realtor.com® is operated by News Corp [NASDAQ: NWS,
NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. under a perpetual
license from the National Association of REALTORS®. For
more information, visit realtor.com®.
Contact:
Lexie Holbert
lexie.puckett@move.com
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SOURCE realtor.com