First Time Home Buyers Described in Yearly Report
The upheaval in global financial markets over the past few years may have been unnerving for almost everyone, but among the hardest-hit group was first time home buyers, in Michigan and across the country. Many had to deal with the stress caused by an uncertain economy, the fallout on business and job security, and, more directly, a pronounced increase in the difficulty of securing mortgages.
If you’re selling a Michigan home this summer and have priced it attractively, it could pay to be mindful of this important segment of our market.The good news for Michigan first time home buyers is how the national situation has stabilized. It’s confirmed by the increase in the number of people interested in buying a home for the first time — which has climbed out of the slump. The latest NAR (National Association of Realtors®) annual Profile — a yearly report describing home buyers and sellers — shows that new entrants into the residential market accounted for 39%, just 1% shy of the pre-crash mark.
So just who are Michigan’s first time home buyers? That’s where the NAR report gives us some important clues. Three-quarters of first time buyers across the nation fall into the category of current tenants — those living in rented accommodations — with 18% still living with parents. As you’d expect, almost all (98%) of that segment hope to fund their purchase with a mortgage, with 81% preferring a fixed-rate loan. Some first time home buyers plan to use personal savings for the down payment, but many others plan to get help from family. (Michigan home sellers take note: one possible incentive to make your listing stand out might be to include an offer to cover closing costs.)
Three-quarters of respondents were aged from 22-42. The single most common reason given for buying a home is to start a family (70%), and of those buying a home for the first time, 51% are married couples. With proportions like those, any home in a family-friendly area should benefit by pointing out attractions like local parks, playgrounds and superior schools.
Maybe the most interesting statistic in the report was that 28% of the first time home buyers were already making plans to move again within five years! It may follow that, at least in many cases, first time home buyers in Michigan may not want to deal with remodeling issues. Attracting them could be the final reason to bring your property into “move-in” condition.
Well thought-out marketing is the key to success with any listing, whether it’s catering to Michigan first time home buyers or to any other segment. If you are thinking of selling your own home, a call to me and a some preliminary groundwork on a marketing plan that will work for you is definitely in order!