Understanding the needs of home buyers and sellers allows real estate agents to provide targeted services that help you achieve your end goal. Part of our commitment to better serve your specific real estate needs is studying who is active in the market and why they are buying or selling their home. The 2020 Home Buyers and Sellers Generational Trends Report provides insights that enable us to create a unique customer service and marketing plan to achieve your goals.
What do we know about homebuyers?
Generation Y (born 1980-1989) and Generation X (born 1965-1979) make up a combined 48% of all homebuyers in Northern Alabama for 2020. The Gen Y/Millennials comprise the largest generational group of buyers, representing a quarter of all buyers.
Millennials represent the real estate market’s future. Many have achieved the financial success that allows them to stop renting and purchase a home. In the Trends report, we see the growth in their home-buying power when looking at the number of first-time homebuyers, who were primarily millennials. First-time homebuyers represented around 33% of all transactions in 2020.
Understanding the motivating factors behind why people purchase homes improves how we target our marketing. Millennials and Gen X generation tend to prioritize convenience to their job and commuting costs.
What about the homes they are buying?
Detached single-family homes remain the most common type of home purchase across all generations. Most buyers purchased a home near where they already resided, moving a median of 15 miles from the prior home. They looked for ten weeks and saw a median of nine houses.
When it comes to other housing types, millennial buyers aged 22 to 29 purchased townhomes at a higher rate than other age groups. More experienced buyers were likely to buy new construction. Also, 12% of home buyers purchased multigenerational homes, with the majority motivated to do so to take care of aging parents.
How are they buying homes?
As financial wealth increases over time, the homebuyer’s need to finance a home purchase decreases. Younger home buyers are more likely to use their savings for a down payment, while older buyers leverage proceeds from the sale of their prior home to purchase. Nonetheless, 86% of homebuyers in 2020 financed their home purchase.
What do we know about home sellers?
While the Millennials and Gen X’ers represent the majority of buyers, the Baby Boomer generation (born 1946-1964) is the most active home seller. In 2020, 45% of home sellers in the Northern Alabama region were boomers.
The median home seller lived in their home ten years before selling, but sellers ages 30 to 39 stayed just five years. Baby Boomers resided in their homes for a median of 19 years.
Most home sellers moved within the same state.
What do we know about the homes sold?
The sold homes typically were on the market for three weeks. The sellers made a median of $60,000 in equity from the sale. When broken down by generation, sellers 74 years and older gained a median $103,000 in equity compared to sellers 30 to 39, who earned a median of $48,000.
The most crucial feature that attracted buyers under age 55 to the properties was photos. Given how many home buyers are in this age range, it emphasizes the need for high-quality photography and virtual tours. The details about the properties were also important to all age groups.
What do we know about our role in the real estate process?
Buyers and sellers in all age groups seek the help of a real estate professional for the process.
Homebuyers used a real estate agent 89% of the time to purchase their home. The buyers cited how real estate agents assisted with negotiations, tracking the paperwork, and providing advice about the real estate transaction process.
Home sellers across all age groups hired real estate agents to help market their home to potential buyers. They cited the professional’s ability to sell their home within a specific time frame and price it competitively.
How we help home buyers and sellers
Amanda Howard Sotheby’s International Realty represents the most extraordinary properties and people across the globe. Our company begins with a clear set of values that define our culture – values that each of our thoughtfully selected real estate agents embrace on a daily basis. Together, we promote positivity, persistence, and the pursuit of wisdom in everything we do. Always inviting, discreet, and refined, each of our real estate professionals possess extensive experience in the field. Along with the use of the most innovative real estate technology combined with market data and experience, we tailor our real estate services to exceed your expectations and achieve the personal approach that all of our clients deserve.