Knowing the history of the housing market can help investors to understand the real estate industry a little better. One of the most valuable resources is the selling and buying data that the National Association of Realtors® has kept over the decades. When the past 35 years are considered, there are four major real estate trends that have remained true throughout the years.
Less First-Time Homebuyers
Since 1987, the rate of people buying a home for the first time has been dropping. Currently, only 32 percent of the real estate market is first time home buyers. There was a slight peak in first-time buyers when people got a tax credit for buying a home for the first time, but modern rates of first-time buyers remain much lower than the historic average of 39 percent.
Buyers Think Bigger Is Better
Despite some popularity for niche trends like tiny homes, the average buyer still wants a big house. The data from the National Association of Realtors® reports that the median size of the home has risen a lot since the 1980s. The average size of a home is starting to remain steady instead of increasing sharply each year, but it still seems like the usual buyer prefers a larger house of around 2,000 square feet.
House Hunting Is More Difficult
Decades ago, buyers would usually just take a few weeks to find a house. However, the population has grown quite a bit, so now there is an increased demand for homes. The average time it takes buyers to get a house was up to eight weeks by 2007 and 10 weeks by 2018. This happens because buyers have to look harder to find the house they want in all the limited inventory. Due to the heightened demand, buyers now have to pay higher down payments than they used to.
A Majority of People Use Realtors®
Some worried that the increase in internet shopping would put Realtors® out of a job, but this does not seem to be happening. Though almost all buyers now use the internet to look at potential homes, they still choose to also employ an agent. Rates of Realtor® use for sellers also remain high, since only 9 percent of owners try to sell a house themselves.