Top 10 Takeaways from the NAR’s 2024 Profile of Home Buyers and Sellers

The National Association of REALTORS® (NAR) recently released its annual Profile of Home Buyers and Sellers, capturing valuable insights about today’s housing market. Here are the standout findings, providing a snapshot of how home buying and selling trends are shifting.

1. Fewer First-Time Buyers
The share of first-time buyers hit an all-time low, as many faced challenges like limited inventory, reduced affordability, and difficulty saving for down payments. Rising rents and debt from student loans and credit cards were significant hurdles for those aiming to enter the housing market.

2. Rising Buyer Household Income
Household incomes for successful buyers have surged to new highs. This increase is essential given elevated home prices and interest rates, which reached nearly 8% during the study period. First-time buyers saw particularly steep income growth, with a notable $26,000 increase over the past two years.

3. Older Home Buyers
Higher incomes and limited inventory have led to an increase in the median age of both first-time and repeat buyers. Many first-time buyers are older due to the need to save longer, while repeat buyers are making moves later in life, often around retirement.

4. Fewer Buyers with Children Under 18
The proportion of buyers with children under 18 has dropped to a historic low of 27%. This shift reflects changing family dynamics, with more buyers in older age brackets and fewer families with young children. As a result, preferences in neighborhood amenities may also shift, aligning with the lifestyle needs of this demographic.

5. Multigenerational Home Purchases on the Rise
Multigenerational living is now at a peak, with 17% of buyers opting for homes that accommodate extended family members. This trend is fueled by rising housing costs, with families pooling resources to buy larger homes. These setups offer the benefits of shared expenses and the ability to care for both young children and elderly family members under one roof.

6. Larger Down Payments
Down payments reached their highest levels in years for both first-time and repeat buyers. With growing home equity, existing homeowners are able to put down larger sums on their next purchases, helping to manage monthly payments despite high interest rates.

7. Increase in All-Cash Purchases
All-cash deals have reached a record high of 26%, exclusively among primary residence buyers. Many repeat buyers leverage their accumulated home equity for cash purchases, while some first-time buyers draw from inheritance or other financial assets to bypass traditional financing.

8. Urban Living Gains Popularity
City living has seen a resurgence, with 16% of buyers choosing city centers—the highest share in a decade. While suburbs remain the top choice, followed by small towns, there’s a growing appeal for urban environments, driven by factors like neighborhood quality and proximity to family and friends, with less emphasis on work commutes.

9. Continued Reliance on Real Estate Agents
A remarkable 88% of buyers worked with a real estate agent or broker, valuing their expertise in finding homes, negotiating, and navigating the market. Real estate agents continue to play a vital role in helping buyers make informed decisions in a complex market.

10. Sellers Also Rely on Agents
Similarly, 90% of sellers opted for a real estate agent or broker to manage their transactions. Sellers prioritize agents who can price competitively, market effectively, and connect them with qualified buyers. The for-sale-by-owner (FSBO) approach fell to a record low, with only 6% of sellers choosing this method, and most of them already knowing the buyer.

These trends provide a clear look at the evolving landscape for buyers and sellers, highlighting shifting demographics, rising financial demands, and the enduring value of real estate agents in achieving successful transactions.

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source: www.nar.realtor