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This work-for-hire piece was published as a feature article in Washington REALTOR® News Magazine (Volume 7 Issue 1, April 2007) which is the Bimonthly Publication direct mailed to 27,000 REALTORS®. This is a summary of a 50+ page market study. Word Count: 981 NO REPRINTS Understanding
Typical Home Buyers and Sellers in Washington When buying or selling a home today's real estate consumers have more options than ever. From the Internet to self help books, the tools at the typical consumer's hands are extensive in the continually evolving real estate market. To remain competitive it is important for today's real estate professionals to understand the characteristics and motivations of the typical home buyer and seller, and to utilize that information to tailor their services to consumer needs. Washington Realtors® commissioned NAR to research home buyers and sellers in Washington state to identify key characteristics and compare them to consumers nationwide. The resulting 2006 National Association of Realtors® Profile of Home Buyers and Sellers can help real estate professionals stay on top of the changing demands of consumers. Characteristics of Home Buyers Overall Washington home buyers had a higher income ($77,100 compared to $71,800) than buyers nationwide. Of those who bought homes in Washington 63 percent were married and 64 percent had no children under the age of 18 living with them. First time buyers were typically under the age of 34 with a medium income of $64,500 (compared to $58,300 nationally) and accounted for 35 percent of home purchases in 2006. Characteristics of Homes Purchased Seventy-five percent of homes purchased in 2006 were detached single family homes. However, only 44 percent of homes purchased in Washington were in suburbs compared to 55 percent for the rest of the country. Also in 2006 the typical Washington home buyer purchased a home 13 miles from their previous residence and the median price of homes purchased was $272,000 (compared to $214,000 in the U.S). When it came to choosing the location for their home purchase 58 percent of buyers ranked the quality of the neighborhood as the most important feature. Proximity to job, nearness of friends and family, and the convenience of shopping were the next three biggest factors influencing home location. Other factors in order of significance were: The quality of the school district and the design of the neighborhood, access to leisure and entertainment activities, location of schools and parks/recreation, availability of health facilities and public transportation as well as other miscellaneous items. The proximity to an airport and belonging to a planned community were the least influential factors. The Home Search Process A whopping 91 percent of home buyers in Washington used a real estate professional during their home search compared to 85 percent nationally, with 94 percent of repeat buyers utilizing a real estate professional. Seventy-one percent of buyers found their real estate agent to be very useful in their search for a home. The Internet continues to be a fast growing tool in the real estate market with 65 percent of home buyers using it regularly to search for a home and 30 percent of buyers going on the purchase homes they first found via the Internet. Whether or not they used it often 74 percent of buyers viewed the Internet as a very useful tool in searching for a home. Home Buying and Real Estate Professionals Eighty-three percent of home buyers purchased their home through a real estate agent after searching for a median of 2 weeks on their own before contacting one. Fifty-seven percent of first-time buyers were referred to their agent by a friend, neighbor or relative. Buyers ranked reputation as the most important factor when choosing a real estate professional with 98 percent of buyers ranking honesty and integrity as "very important". When asked about their agent's performance on those qualities 83 percent reported they were "very satisfied". Financing the Home Purchase Ninety-one percent of all home buyers in Washington financed their home purchase. First time buyers were more likely to finance at 98 percent compared to 88 percent of repeat buyers. Savings were the main source of the down payment for most first-time home buyers (58 percent) while 69 percent of repeat buyers used proceeds from the sale of their previous home. Eighty-nine percent of all buyers believe that their home purchase was a good financial investment in 2006. Home Sellers and Their Selling Experience The median age of home sellers in Washington was 48 years with a median household income of $85,700 in 2006. Seventy-two percent of sellers were married and 63 percent had no children under 18 years old living at home. The typical home was on the market for four weeks and 65 percent of home sellers did not reduce their asking price before their home sold. In line with the trend of home buyers search habits, 91 percent of sellers used the Internet to market their home Eighty-five percent of sellers used an agent or broker to sell their home and 67 percent of all sellers were very satisfied with the selling process. Home Sellers and Real Estate Professionals When selecting a real estate professional, 31 percent of sellers received a recommendation from a friend, neighbor or relative. Less than half of sellers used the same agent for their home purchase. Eighty percent of sellers used an agent that provided a wide range of services and who managed most aspects of the sales transaction and 63 percent of sellers stated they would definitely use the same real estate agent again. For Sale By Owners (FSBO) Ninety-two percent of Washington FSBO sellers sold a single-family home. The median selling price of FSBO homes in 2006 was $237,500 compared with $320,000 for agent-assisted home sales. The primary reason FSBO sellers did not use a real estate agent was to avoid paying a commission. 1 in 4 of FSBO plan to use a real estate agent the next time they sell their home. Conclusion These findings from the 2006 study show that even in a growing "find it yourself on the Internet" era consumers in Washington and nationally still value the expertise and assistance of real estate professionals with the home buying and selling process and continue to recommend them to family and friends. Agents and brokers who stay in touch with their clients' needs and offer high levels of service remain a competitive force in this dynamic market. If you would like more details regarding the profile of the Washington buyer and seller, have your broker contact the Washington Realtors® for additional information. |
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