Today’s housing market is fast-paced and often pricier than it’s been in decades. Both renters and buyers are facing challenges in finding a place to call home. Both sellers and homeowners also face their own set of challenges — tied to the line they walk between seeing their home as a personal extension of themselves as well as one of their biggest financial investments. The Zillow Group Consumer Housing Trends Report 2017 is a deep dive into understanding all these challenges as well as the deep desires people have around home.
Zillow surveyed over 13,000 people to determine how Americans rent, buy, sell and even think about real estate as part of the report research. Some of our discoveries could be surprising, or perhaps to today’s renters, buyers, sellers and homeowners, the findings ring very true.
More Americans are renting today than in recent decades — some by choice and some simply due market conditions. Thirty-seven percent of American households are renters — about 43.7 million homes — which is an increase of 6.9 million homes since 2005. While part of the rise in renters is due to the 8 million homes lost to foreclosure during the recession, renters today also prize the maintenance-free and flexible lifestyle renting offers.
- Renters skew younger: The typical renter has a median age of 32 years old.
- Renters represent a more diverse population. Fifty-five percent are Caucasian/white, an additional 19 percent are African-American/black. Hispanics count for 17 percent of renters, Asian/Pacific Islander renters make up 7 percent of the renter population and another 3 percent identify as another ethnicity.
- Nearly half of renters are single, including a third who have never married.
- Although the majority of renters are single, 78 percent live with others, most often this is another family member.
- The median rent across the U.S. is $1,010 with highest rents in the West and lowest rents in the Midwest.
- Renting can be expensive: 79% of renters who moved in the past year had a rent increase.
- More than half of renters (57%) had a rent increase impact their decision to move and 37% of renters who aren't moving say it's because they can't afford to.
Buying is tough in all markets. For most Americans, it’s the biggest purchase they’ll ever make as well as a significant financial investment they’ll tap into as part of retirement. In particular cities, purchasing a home has become a competitive game, complete with bidding wars and offer negotiations. It makes sense that most buyers rely on agents to help them through the process.
- Today’s buyers have a median age of 40, although the majority (71%) of first-time buyers are Millennials.
- The median household income of the typical buyer is $87,500 and most buyers are married or partnered, relying on two incomes to purchase a home.
- The typical home in the U.S. purchased has 3 bedrooms, 2 1/2 bathrooms, measures 1,800 square feet and costs $200,000.
- More than anything, buyers want their home to be in a safe neighborhood (71 percent of buyers) and in their price range (67 percent of buyers).
- Other than safety, buyers also want to stay cool. Sixty-two percent of buyers require their homes to have air conditioning.
- Buyers take an average of 4.3 months to search for their new homes — although Millennials take just under four months (3.9 months) and those in the Silent Generation who take the longest at 5.6 months.
- The suburbs rule: 49% of buyers buy there, followed by 31% of buyers buying in urban locations and just 19% of American buyers purchasing in rural regions.
Although some hot markets have favorable conditions for sellers, selling is still rarely an easy process. Sellers have two main goals when they list their homes: one- to sell their home in their preferred time frame, and two, sell for their desired price. Balancing the two, timing and price, create a delicate dance and throw in the fact that most sellers are also buyers and searching for their new home, creates a often stressful experience.
- Sellers have a median age of 45 although Millennials make up nearly one-third of todays’ sellers.
- Sellers have a higher median income than homeowners at $87,500.
- The typical seller has lived in their home for 12 years.
- Most sellers are selling for the first time (61%) and looking to buy at the same time (71%).
- Seventy-six of sellers have to make at least one concession to sell their home — most often being a price reduction.
- One in two sellers sell their home for less than their original listing price.
As anyone will tell you, owning a home is a lot of work. It’s also a great investment, especially in many of today’s markets were annual appreciation rates are higher than they have been in decades. Beyond the work and the financial piece, home ownership often has an emotional component as well.
- Homeowners are the oldest, with a median age of 57 years and just 14% are Millennials.
- Homeowners have a median household income of $62,500 and 71% live with a spouse or partner.
- Forty percent of homeowners have a pet (with dogs ranking in top at 30%).
- Almost half of homeowners (46 percent) live in the first home they purchased, although this percentage decreases with age.
- Eighty-six percent of homeowners have no plan to sell in the next three years.
- Less than a quarter of homeowners say their home is in “like-new” condition and more than 60% say their home could use a little updating.
- The top of homeowners’ to-do list for the next year include: painting the interior (25%), improving the bathroom (22 percent) and landscaping (21 percent).
Learn more about today’s renters, buyers, sellers and homeowners in the Zillow Group Consumer Housing Trends Report 2017.