As a mortgage broker, if you want to beat the competition, using data-driven analytics can help you develop a better understanding of your client base and grow your business. Since 2013, the National Association of REALTORS® (NAR) has produced the Home Buyer and Seller Generational Trends Research Report. Click here for the full report.
For a quick overview of the information we found the most interesting, read our key takeaways below.
- Millennials (ages 22-39) made up the largest share of homebuyers at 38%. The majority of those were first-time homebuyers, they were most likely to purchase a previously owned home or a townhouse, and they were most likely to search for and find their home online.
- Millennials are expected to spend the next 10 years in their home. In contrast, people ages 40-73 are expected to spend 20 years in their home. In terms of repeat customers, your younger ones are more likely to need a new home within a shorter time span.
- Buyers 40-55 years old had the highest incomes, while buyers 30-39 years old purchased the most expensive homes. They also purchased the largest homes and the second-most expensive homes. Buyers ages 30-39 purchased the most expensive homes (at a median price of $282K).
- 95% of homebuyers ages 22-54 financed their home purchase. That percentage drops dramatically when you approach age 55 and beyond (reaching 66%).
- Homebuyers ages 22-54 financed an average 89% of the home purchase price. Contrast that to the 77% average financed by buyers age 55 and up.
- 62% of all buyers used a conventional loan to finance their homes. The next highest were FHA loans at 17% and VA loans at 13%. Buyers ages 65-73 tended to utilize conventional loans at the highest rate (71%).
- 89% of all buyers had a fixed-rate mortgage. The next highest category was the fixed-then-adjustable rate mortgage at 3%.
- Life changes like marriage, having children, children moving out or in, retirement, etc. are the top reasons for people to move – representing 27% of the market. The second most common is a job or career change (12%), and third is managing healthcare for a household member (9%). Keep an eye out for those life changes in social media channels.
- The first step in the homebuying process was most often online search for properties (44%). 16% contacted a realtor first, and 12% looked online for research about the homebuying process. Only 7% contacted a bank or mortgage lender first.
- Young and old millennials find understanding the homebuying process nearly as difficult as choosing a home. While finding the right property was by far the most challenging step in the process, 39% of younger millennials (ages 22-29) and 23% of older millennials (ages 30-39) felt that understanding the homebuying process was a big challenge, as well. Providing education about the homebuying process could meet a need for your borrowers, solidify you as a subject matter expert on loans, and help build your relationship over the long term.
Using data like the NAR report can help you fine-tune and prioritize your marketing strategy to get the best return for your time and marketing budget.
At Caliber, we provide a wide array of conventional, FHA, and VA loans, and support our business partners with marketing tools and resources. Plus, you’ll have a dedicated team to walk alongside you through each loan. Helping others realize their dreams is our daily passion. We live it, we breathe it, we work it. Partner with us today.