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| Photo provided by Arkansas Realtor® Dwayne Hatt |
A recent survey by the National Association of Realtors® found that home buyers confirmed a long-term view of home ownership, the typical seller is experiencing positive returns and the vast majority of home owners see their property as a good investment. The 2010 National Association of REALTORS® Profile of Home Buyers and Sellers is the latest in a series of large national NAR surveys evaluating demographics, preferences, marketing and experiences of recent home buyers and sellers.
Although typical sellers had been in their previous home for eight years, up from seven years in the 2009 study, first-time buyers plan to stay for 10 years and repeat buyers plan to hold their property for 15 years.
NAR 2010 President Vicki Cox Golder, said the pattern of home buyers taking a long-term view has solidified over the past few years. “This underscores two simple facts – home ownership encourages stability, and the longer you own, the better your investment.”
Even with several years of price declines, the typical seller who purchased a home eight years ago experienced a median equity gain of $33,000, a 24 percent increase, while sellers who were in their homes for 11 to 15 years saw a median gain of 40 percent.
“Sellers who purchased at the top of the market and had to sell in a short time frame were hurt by the price correction, but the vast majority who are able to stay for a normal period of home ownership generally built enough equity to make a trade-up purchase,” Golder said. “Despite swings in the housing market in recent years, the fact is most long-term owners see healthy gains in the value of their property.”
In the 2006 study, covering sellers during the close of the housing boom, 6 percent of sellers had owned their property for less than a year and a total of 30 percent had owned for three years or less. In the 2010 study, only 3 percent had owned their home for less than a year and a total of 11 percent had owned for three years or less.
Paul Bishop, NAR vice president of research, said the lion’s share of buyers view their home as a good investment. “Eighty-five percent of recent home buyers see their home as a good investment, and nearly half think that investment is better than stocks,” he said. “Even with the turmoil created by the housing boom and bust, this indicates the long-term view of home ownership as a fundamental goal and value remains sound. In fact, the single biggest reason most people buy a home is the simple desire to own a home of their own, cited by 31 percent of respondents, including 53 percent of first-time buyers.”
The next biggest reasons for buying, identified by all home buyers, were desire for a larger home, 9 percent; a change in family situation and the home buyer tax credit, cited by 8 percent each; a job-related move, 7 percent; and the affordability of homes, 6 percent. Twelve other categories were 5 percent or less.
The number of first-time home buyers rose to a record high 50 percent of all home sales from 47 percent in the 2009 study, building on success of the home buyer tax credit which began in 2009. The previous cyclical high for first-time buyers was 44 percent in 1991; records date back to 1981.
The Arkansas Realtors® Association, with thirty-seven local Realtor® Boards and Associations statewide, is the state arm of the Chicago- and Washington, D.C.-based National Association of Realtors®. Members of the National Association, the State Associations and the local Boards and Associations are identified by the registered membership term, “Realtor®” and pledge adherence to the Realtors® Code of Ethics.
The 2010 National Association of REALTORS® Profile of Home Buyers and Sellers survey can be ordered by calling 800-874-6500, or online at www.realtor.org/prodser.nsf/Research.
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