Who Are the Main Homebuyers in the U.S., and What Features Matter Most to Them?
2024-01-16 Evelyn Yang recommends
In 2023, affected by the broader economic environment and soaring mortgage rates, the U.S. housing market gradually cooled from its previous hot pace.
Against this backdrop, how did buyers and sellers change? What new trends emerged in real estate transactions? Let’s take a look.
Buyer Profile
1. The share of first-time homebuyers rebounded compared with last year, accounting for 32%. However, it remained below the 38% average since 1981.
2. This year’s typical first-time homebuyer was 35 years old, slightly younger than last year’s 36. Meanwhile, the typical median age of repeat buyers fell from a historic high of 59 to 58.
3. Among recent homebuyers, 59% were married couples, 19% were single women, 10% were single men, and 9% were unmarried couples. This was the lowest share of married couples since 2010.
Home Purchase Characteristics
1. Thirteen percent of homebuyers purchased new homes, while 87% purchased previously owned homes.
2. Most buyers who purchased new homes did so primarily to avoid renovation and plumbing or electrical problems, accounting for 45%. Buyers of previously owned homes valued better prices, accounting for 38%.
3. Single-family homes remained the most popular home type among recent buyers, accounting for 79%, followed by townhouses at 8%.
4. For homebuyers, community quality was the most important consideration when deciding where to buy, at 60%. This was followed by convenience of visiting family and friends, at 45%, and whether overall home prices were affordable, at 39%.
Sources of Home Purchase Funds
1. In 2023, 80% of homebuyers financed their purchases with a mortgage, a slight increase from 78% in 2022, but still below the 87% recorded in 2021.
2. First-time buyers typically made down payments of about 8%, while buyers with previous homebuying experience made down payments of 19%.
3. Buyers continued to view homeownership as a sound financial investment. Eighty-two percent said they believed buying a home was a good investment.
Seller Profile
1. For sellers, the most common reasons for selling were wanting to live closer to friends and family (23%), the current home being too small (13%), or changes in family circumstances, such as marriage, divorce, or a new family member (10%).
2. Sellers typically had lived in the property for 10 years before selling it.
3. Recently sold homes had a median time on the market of two weeks, unchanged from last year.
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