Unsettled times: Trends among sellers and buyers during the pandemic
COVID-19 has changed our lives and lifestyles since it swept across the country in 2020. It also changed the way we look at our homes in the midst of a booming real estate market.
A new “2020 Profile of Home Buyers and Sellers” released by the National Association of REALTORS, has new twist this year – a section that looks at how the pandemic affects attitudes about purchasing and selling decisions. The association surveyed more than 8,000 people across the country between July 2019 and June 2020.
It found trends such as the desire for homes that offered more space – indoors and outdoors – in addition to spaces that work well for multigenerational families, as older relatives and young adults moved back under one roof. For sellers, virtual marketing of homes was key, as buyers did fewer in-person tours to limit exposure to the virus.
Here is a look at 14 trends that have emerged among home buyers and sellers, according to the association’s survey.
First, for home buyers:
- Multigenerational homes grew in popularity. The reasons? Health and caretaking, cost savings, spending more time with relatives, and a delay in adult children moving out on their own.
- Home prices were higher and higher priced. Also, 23% of buyers who purchased homes after March bought a home that was at least $500,000.
- Buyers don’t expect to stay in their home as long. Buyers who purchased a home after the pandemic outbreak said they expect to stay there for a median of 10 years, compared to a 15-year prediction by those who bought in the nine months before the pandemic
- Renters became owners. Before the pandemic, 36% of homebuyers had been renters, a number that jumped to 45% since the pandemic.
- A desire for suburbia. Homeowners who bought between April and June were more likely to pick a suburban location than in the months before the pandemic, while urban areas or central cities also saw a slight increase in buyers.
- A shorter, more focused home search. After March, buyers started working with agents sooner in their home search and limited the number of homes they visited.
- Growth in new types of buyers. Married couples remain the largest segment of home buyers, but the number of unmarried couples and some minority groups purchasing homes has grown during the pandemic.
Trends also emerged for sellers since the pandemic, including:
- A desire for more space. As people stayed home during the pandemic, many decided they wanted to upsize their homes. Even the main group of traditional downsizers —people over 55 — have resisted the desire to go smaller.
- A sense of urgency. Since the pandemic, sellers report they are more likely to sell quickly rather than hold out for a higher offer.
- Technology rules in marketing. Sellers relied heavily technology, particularly virtual tours, to market their homes.
- Incentives didn’t disappear. Incentives to attract buyers, such as credits toward remodeling or repairs, are still popular, even with the high demand for houses.
- Growth of equity. The increase in home prices means sellers will have more equity built in their homes. Since the pandemic, sellers have gained a median equity of $80,000 compared to $64,000 before the pandemic.
- Time to move on. Even long-time homeowners felt the desire to move. The survey showed 40% of sellers in the months after the pandemic had owned their home for 16 years or more, compared to 34% of those who sold before April.
- Family ties stay strong. Home sellers continue to say a main reason they move is to be closer to friends and family members. During the pandemic, that trend was also clear among sellers who are moving farther away.