It’s a competitive and scary market for first-time buyers due to fewer listings, rising median prices, widespread use of tech tools and buy-it-now pressure.
NEW YORK – The share of first-time buyers in the housing market reached 36% in April 2020, up from 31% in 2018 and 2019, according to the National Association of Realtors® (NAR).
Millennials represent the largest contingent of homebuyers in the United States despite being much more likely to have lost steady employment due to the pandemic.
Meanwhile, the median sales price of single-family homes rose more than 10% in 88% of U.S. metro areas, NAR reports, pushing the monthly mortgage payment for a typical single-family home up to $1,040 this month. Further, active listings on the market are down 40% annually.
An October survey from Realtor.com revealed that nearly half of millennial home shoppers were planning to buy a home sooner than expected because of the pandemic. The increased pressure on the market has been coupled with widespread adoption of tech tools that facilitate the home-buying process.
Sixty-three percent of buyers who used Redfin in November and December made an offer on a home they hadn’t seen in person, and monthly views of 3-D walk-throughs on the site are up more than 500% since February 2020.
Brokers, who saw most of their open houses shut down during the pandemic, have been quick to adapt to technology as well, with many offering virtual tours and embracing social media tools to help market their homes.
However, some brokers recommend being cautious about jumping into the online market.
“The first time, it’s all so overwhelming, and tough to grasp how the process even works. And now you’re being asked to compete at a very high level,” says Michelle Kolker, a San Diego broker with Kolker Real Estate Group.
According to a July 2020 survey by Zillow, 36% of Americans would be more likely to buy a home entirely online.
Source: New York Times (02/19/21) Kamin, Debra
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