With rates low, housing prices falling, more lenders are offering fixed rate conventional, FHA and VA loans. Right now, it’s the PERFECT STORM for you to get your share of the first time homebuyer purchase market. Here are the results from the National Association of Realtors® Survey of Home Buyers and Home Sellers 2008.
- First Time Homebuyers Made Up 41% of All Home Purchases
- Living Arrangements Prior to Buying Their First Home
-75% of FTHB lived in apartment complexes or rented a home or condo prior to purchasing.
-19% lived with parents prior to purchasing.
- Marital Status of First Time Homebuyers
o 49% Married Couples 24% Single Females
o 12% Unmarried Couples 12% Single Males
Single female buyers are double the percentage of single males and half of married couples. It’s a niche within a niche, so consider holding “Women-Only First Time Home buying” Seminars.
- Medium Age of First Time Homebuyers
o 54% – Age 24-35
o 20% – Age 35-44
Think Gen X here! They are independent, blunt and skeptical! Creative emails, an awesome website and social networking all need to be part of your marketing business plan.
- Average Income of First Time Homebuyers
o Married $70K Single Male $54K
o Unmarried $65K Single Female $47K
Single women earn 13% less income than single males, but they purchase twice as many homes. Another reason to consider Women-Only seminars and creating marketing pieces “for women only” or “couples only” seminars.
- Purchase Price Range
o 16% – Price Range of $75K to $100K
o 39% – Price Range of $100K to $175K
Based on this info, over half of your FTHB are more likely to purchase a home $175K or below.
- Moving Distance from Current Residence
o 13 miles from their previous residence (apartment or parent’s home).
So if you are marketing to apartment complexes, consider the location of the complex and compare it to the surrounding (affordable) homes as a guide in choosing the complexes to market to.
- Information Sources PRIOR to Buying Home
o Internet Search 94% Open Houses 48%
o Virtual Tour 63% Homes Magazines 30%
o Newspaper Ads 45% TV 9%
- The Internet, Virtual Tours and Social Networking
o Found Home on Internet 37%
o Found Agent Online 28%
o Mortgage Prequal Online 11%
o Mortgage Application 7%
Real estate agents and loan officers could team up and provide financing info, with different loan products (FHA, VA, Conventional).
- Length of Time to Buy Home
o Research Time Before Agent 3 weeks
o Sign a Contract 12 weeks
The “selling time” is about 30 days longer and you should have a system in place to stay in touch over a longer time period.
- FTHB Tenure in Home Resale
o Age 18-25: 88% plan to sell their home within 2-3 years after buying it
o Age 25-44: 28% plan to sell their home within 2-3 years after buying it
You are 3 times more likely to re-sell a previous client in this age group, than the 25-44 group. It’s critical to keep in touch, especially emails or social networking, if you want the change to sell them another home.
The bottom line is that you might want to concentrate your marketing to apartment complexes or combing your database for clients whose children might be buying a home in the future – and asking for their referrals. Create a functional website and a database system to stay in touch!