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Homebuyers In America Were, On Average, Older And Richer Than Ever This Year

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According to a new survey from the National Association of Realtors, in 2024 a record number of Americans were older and utilized an inheritance to help finance buying a new home. 

The survey found that first time home buyers in America were older and wealthier than previous years between July 2023 and June 2024. The report emphasizes a struggle that many Americans are facing when it comes to buying a home. Increasing prices and record-high mortgage rates have remained consistently high.

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According to reports from CNN, first-time homebuyers had an average household income of $97,000, a near $2,000 increase from last year. The average age of first-time homebuyers was also 38, the highest it’s been on record. 

“We’re seeing a dichotomy in this real estate market where those first-time homebuyers are not just your traditional first-time buyers, like schoolteachers or first responders, really entering into the market,” said NAR deputy chief economist Jessica Lautz. 

“The people who can get in are really a select few.”

Within the last year, first-time homebuyers decreased to just 24% of all homebuyers in America. This is the lowest percentage since the NAR began collecting data back in 1981.

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25% of first-time buyers were surveyed to have used a “gift or loan from a relative” to help finance the purchase of their home. 

Lautz said that it’s likely the overall decline in first-time homebuyers using help from family members parallels how they’re also getting older.

“Everyone’s situation is different, but that’s one of the things that seems to be working in conjunction. That seems to be dropping off at the same time as the median age is crawling up,” she said.

The NAR report also showed a major divide with Americans who owned homes during the recent spike in home values and those who are in the market for a home.  

Repeat homebuyers in America have also gotten older on average; the average age increased from 58 to 61 in a year. Repeat buyers also had an increase in average household income, rising to $114,300 from $111,700. 

“The report shows both the struggle in America to secure homes to purchase, and then also people making housing trades with record levels of housing wealth,” Lautz stated.

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45% Of Real Estate Agents Claim They’re Struggling To Pay Rent 

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According to a monthly report from Alignable, 45% of real estate agents who own their firms stated that they’re struggling to pay their offices rent in the month of November. This is a 5% increase from October, and 10% higher than September’s data, citing a consistent increase. 

This data aligns with the attitudes of US homeowners as of late, as many who are wanting to move are currently waiting for the market to improve and constant high housing costs to decrease. Overall inventory for homes on sale is also the lowest it’s been in a very long time. 

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Corey Burr, the senior vice president at TTR Sotheby’s International Realty, stated that these recent reports aren’t actually surprising. He discussed how recent interest rate hikes have been driving up mortgage rates and bringing home sales to a lull. 

“I think that the Federal Reserve has put us in this spot where they essentially froze up the residential real estate market by holding interest rates low for so long, and then increasing them so much so quickly. It’s created incredible distortions in our marketplace.” Burr says.

Burr also discussed that he’s been in the real estate industry for over 36 years, so he’s very experienced in following the ups and downs of the real estate market when you own a small business. 

“We are in a spot in the real estate cycle that is hardest for brokerages, particularly the smaller ones who have less market share, and who have fewer assets than the larger brokerages to ride out the storm,” Burr says.

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Prospective buyers are paying close attention to the market as well. High mortgage rates combined with an increase in buyers backing out of deals have led to a major decline in sales. 

Last month, pending home sales were down by 1.5% from September and 8.5% from last year, which is the lowest pending-sales figures according to the National Association of Realtors. 

Burr also mentioned that he expects the amount of realtors to decline across North America as the market continues to struggle, citing that over 60,000 agents left the industry in the first six months of the year. 

Some real estate data analysts are predicting that mortgage rates should decline within the next year. The National Association of Realtors economist Lawrence Yun predicted in early November that mortgage rates could reach between 6% to 7% by next spring and home sales could increase by 13.5% in 2024.

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Online Real Estate Broker, Redfin, Leaves The National Association Of Realtors

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The online real estate brokerage, Redfin, is now requiring many of its agents to cancel their memberships with the National Association of Realtors (NAR) brought on by allegations of sexual harassment from the association, and other problems within the organization.

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How Much Has The US Housing Market Been Impacted By The Pandemic? 

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Housing experts throughout the US are currently experiencing a “white hot” market thanks to a multitude of economic reasons. However, problems that existed in the industry before the pandemic are being just as exasperated due to the impact of the past year overall. 

“One of the most prominent housing issues in pre-pandemic America was supply shortages. That has carried over and exacerbated, but we already had evidence of supply shortages heading into the pandemic,” said Matthew Murphy, executive director of the Furman Center For Real Estate and Urban Policy at New York University. 

Murphy also explained that “today’s housing situation has its roots in the last boom-bust cycle. The context here to this current housing moment is that we were still recovering from the 2009 foreclosure crisis, when property values plummeted.” 

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According to the National Association of Realtors (NAR), over the past two decades an underbuilding gap of between 5.5 million and 6.8 million housing units has existed since 2001. 

The National Association of Home Builders found that of “all the new single-family homes built last year across the U.S., none were priced below $100,000. A mere 1 percent fell in the range of $100,000 to $150,000. Home buyers in the bottom one-fourth of the market have been squeezed entirely out of the market for new construction,” the group said in an online post.

“In a pandemic, with people working from home and kids schooling from home, you need more space. We saw a real pickup in demand. People wanted a home with some green space and a community with lower population density.”

“The increase in demand has really been sparked by the record low level of mortgage rates. That’s a real opportunity for anyone who’s shopping for a mortgage or shopping to buy a home, and that’s really sparked the demand, especially among millennials or Gen Xers,” explained Frank Nothaft, chief economist at CoreLogic. 

Prospective buyers are also noticing a major decrease in available homes due to the fact that those who weren’t as economically stunted by the pandemic have been able to get out and acquire more real estate within the past few months of recovery. 

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“You’ve got this 20-plus percent year-over-year price growth, which you think would entice homeowners to sell. The bigger factor is just availability of supply to move into. … There’s nothing to go buy or downsize into,” said Todd Teta, chief product officer at Attom Data Solutions.

Zillow found a nearly 4% increase in housing availability on the market in May, which has been the first time that percentage has increased since July 2020. The NAR found that the average price of existing homes throughout the US have hit a record number of $350,000; up nearly 25% when compared to last year. 

“This is supply and demand on steroids.”

The other major issue is that builders, architects, and construction workers can’t keep up with the demand that the pandemic has created. Costs for certain raw materials like copper or lumber are projected to continuously increase within the next couple of months. That in addition to labor costs and the cost of land overall is causing a lot of buyers to be hesitant with their purchases. 

“There’s an affordability that comes with density, and in a lot of America, you can’t build that kind of housing. This just makes it harder for the market to supply this housing en masse,” Murphy explained. 

“If we see a substantial increase in the proportion of the workforce working remotely, then I think we’re going to continue to see some of this shift to single-family and this shift not just to suburban but to the outer edges of metro areas. When you sever that link between where you live and where you work, then that gives you a lot of flexibility on where you locate,”  Nothaft said.

Zillow Facing Antitrust Lawsuit After Accusations Of Favoring Certain Listings 

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A real estate startup company is suing Zillow within a federal court over allegations that the website is violating antitrust laws by “deceptively steering customers to home listings from a subset of agents.” 

The suit was filed in a US federal court in Seattle in which the startup Rex alleges that Zillow and its affiliate Trulia are illegally favoring certain listings by brokers who belong to the National Association of Realtors (NAR); the most prominent US real estate trade association. The startup has claimed that non-NAR real estate agents are now located in a “hidden tab” on the website. 

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Rex’s general council Mike Toth was recently interviewed to discuss the suit regarding one of the nation’s most popular real estate listing websites. “The change by Zillow and Trulia forces all non-NAR listings to have permanent low visibility. This is the real estate web returning to this old vision of data segregation rather than data democratization for consumers.”

The suit could potentially shift the way in which certain online real estate platforms operate and allow more opportunities to arise for more buyers and sellers to negotiate the type of agent they want. Zillow and Trulia account for 75% of the online home search market in America, and when they made changes to their sites in the beginning of January, listings began being segregated to hidden areas of the site. 

“Zillow and Trulia started segregating listings, giving preferential treatment to the 1.3 million real estate agents who belong to NAR. Other listings, including those posted by brokers not affiliated with NAR, foreclosures and homes listed for sale by owners without agents, are now relegated to a separate tab. We are asking the court to block Zillow and Trulia from segregating listings,” Rex claimed. 

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NAR has their own real estate listing site, Realtor.com, which is the second-most viewed site for agents throughout the nation. That platform is known for only showing listings by NAR’s agents, and understandably so considering it’s their own website. So the issue now is that the changes Zillow and Trulia made means that three out of the four most popular real estate listing sites are favored for NAR’s agents and their listings exclusively. 

Those listings in particular tend to be more expensive because they require the seller to pay a commission, often 6% of the homes sale price, which is split between the agents of the buyer and seller. Rex has now raised these antitrust concerns with the Justice Department and 35 state attorney generals. 

Viet Shelton is a spokesperson for Zillow who claims the company “made the change in January after it became a participant in the Multiple Listing Services Internet Data Exchange feeds, which are operated by NAR. Zillow’s rules for the IDX feeds require participants to segregate listings. Zillow is committed to giving consumers the most up-to-date housing information on the most amount of listings possible on a single platform. We made changes to the way some listings appear on the site in order to be compliant with MLS rules.” The suit will likely begin unfolding within the next month or so.

Real Estate During COVID-19

How The Real Estate Market Is Reacting To COVID-19

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The COVID-19 pandemic has been affecting multiple businesses and industries. Health and safety is obviously the world’s main concern, so make sure you’re continuing to stay informed, distant from others and are continuing to practice good hygiene. Among the multiple industries taking a hit due to coronavirus, the real estate industry is beginning to see how they might be affected within the coming months as quarantine/lockdown policies begin to be enforced.

According to the National Association of Realtors (NAR), the index of pending home sales has increased by nearly 3% in February of this year. This specific index measures real-estate transactions in America where a contract of sale was signed, but the sale has yet to be closed. 

The index itself helps provide agents with existing-home sales reports and what the coming months for their specific regional industries should expect. February’s national report in 2019 showed that pending signings were up by 9.4% nationally, indicating an obvious decrease in the buyer market, likely due to COVID-19 concerns. 

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“February’s pending sales figures show the housing market had been very healthy prior to the coronavirus-induced shutdown. The data does not capture the significant fallout from the pandemic or the measures taken to control the outbreak. Numbers in the coming weeks will show just how hard the housing market was hit, but I am optimistic that the upcoming stimulus package will lessen the economic damage and we may get a V-shaped robust recovery later in the year,” said Lawrence Yun, NAR’s chief economist.

This time last year, Yun also noted that on a month-to-month basis, pending sales were up in every region of the nation; not entirely uncommon but definitely not common for this time of year for the market in general. The West had an increase of 5%, the midwest 4.5%, the North 3%, and in the South, a mere .1%, still an increase.

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The fact that the market/pending sales reports were much higher this time last year may seem like it should cause some major economic concerns, however, this wouldn’t be the first time the real estate industry has had to cope with a worldwide health crisis or economic downfall. Before the coronavirus pandemic hit the U.S., the market was relatively stable. Supply was a little lower than what the nation is used to, however, the demand to buy was at a relatively high position.

According to NAR, in the winter of this year, America experienced an overall low interest rate environment that began in the summer of 2019. This caused an excess in sales to occur within the past few months, and also made buying a home more affordable. 

Of course, the concern now is how much the COVID-19 pandemic will reverse the real estate market and hinder America’s economy. Based on previous widespread illness outbreaks, the NAR is not too concerned with how the market will respond to this pandemic. In the past, the real estate industry has always rebounded back to where it was in areas of the country that have had their economies affected by health crisis’. It just obviously depends on the specific job/housing market.

“Housing, just like most other industries, suffered from the coronavirus crisis, but once this predicament is behind us and the habit of social distancing is respected, I’m encouraged there will be continued home transactions though with more virtual tours, electronic signatures, and external home appraisals. Many of the home sales that are likely to be missed during the first part of 2020 may simply be pushed into late summer and autumn parts of the year,” Yun said.

Yun went on to encourage any real estate clients who are currently involved in pending transactions to talk with their agency, and bank/financial advisers, about the best possible route to take for the time being. Many industries are trying to comply with the multiple ways the world is adjusting to living during a pandemic, the real estate industry included. So work with the professionals and they’ll work with you, according to Yun, eventually we will return to a place of normalcy, and the market will bounce back.

Real Estate Agent

How Real Estate Agents Continue to Generate Business

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Real Estate has become one of the most popular career paths in America. According to the National Association of Realtors (NAR) 2018 annual report, 1.3 million Americans are currently real estate agents, if you divide that evenly it’s about 26,000 realtors per state! And the numbers are only increasing. The Millennial generation has given the realtor business an influx in new employee’s to work with, but with an increase in supply, comes a decrease in demand. Many businesses are unfortunately struggling, the housing market is always fluctuating, meaning the job market for realtors is also constantly fluctuating. However, not all is lost, as many realtors have shared their best, and even traditionally simple, tips for generating business regardless of how the market is or where your located. 

One of the main reasons this job field is so popular within the millennial generation is because of how much more internet dependent it’s become. Zillow is now going to be your best friend when it comes to building leads and a market for your business. Zillow receives about 200 million visitors every month, this app is the best way for you to advertise any listings you have or maybe even acquire listings. 

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The app is a huge source of information regarding real estate properties. It can tell you when something was built, all the specifics in regards to room and bathroom numbers, backyard sizes, amenities, and what the house has sold for in the past depending on how many times it’s been on the market. Putting any listing you have on Zillow is your best bet at having it reach the widest audience. In addition, realtors have the option to purchase the premium version of the app known as “Zillow Premier Agent.” While it may cost money, this upgrade allows realtors to connect more with active buyers and provides tools and resources to help you turn one time buyers into long lasting clients for your business. 

Prioritize your referrals; according to the same NAR report, 65% of real estate clients find their agents through referrals from past clients. It may be old school but this is the main source of clientele that can help build your business. Offer deals for clients who use you multiple times or refer you to a friend/family member. Reduced to no fees for referral clients is one of the most popular deals used amongst agents, and it’s for a reason. Treating repeat clients or referrals as individuals who you’ve known for years allows for a more casual environment and the relationship between the both of you. When the client feels comfortable and informed, they’re more likely to recommend you.

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Think outside of the box, what I mean by that is that although real estate specific events are a great way to build up clientele, use your agent charm to network outside of the real estate bubble. According to The Boss Magazine, “Successful realtors are masters of ceremonies in many events. They participate in all community work and sponsor many social and national events. Then they take these opportunities to introduce their business and introduce their value propositions.”

Always be on the lookout for potential networking opportunities and always keep a few business cards on you. You never know which random stranger who receives your card will use you and refer you to their friends! Customer testimonials and reviews are another major resource that you can use to build up your business. The NAR reports that 60% of new clients check previous reviews before choosing an agency and/or agent. Instead of worrying about relying on third-party sources such as Yelp, or Google Reviews, create a review section on your agencies website! This way you can also have more control over what is displayed and what’s not. In addition, ask any email subscribers or past clients via email for feedback, try reaching out specifically to clients you remember having a very positive experience with you and your business. These reviews will help generate more momentum of your specific brand of real estate. 

When it comes to building your real estate business to be the best that it can be, don’t stray to far from tradition, there’s a reason it’s worked for as long as it did. Making personal connections with your clients, prioritizing their needs, and making the process as easy/simple as you can for them will ultimately lead to the best reviews, referrals and leads.