As the leading FSBO website, ForSaleByOwner.com has unique insights into all aspects of how consumers sell and buy homes nationwide. While data and sentiments on the industry seem to change almost daily, one thing is certain: big changes are coming.
This 2015 Real Estate Outlook report reflects our perspective on what’s to come and how to navigate the changes on the horizon.
1. Bottlenecks to Recovery But a Brighter Road Ahead
While the housing recovery has gained momentum, it is not yet as widespread as anticipated, largely due to consumer hesitancy and low levels in new home construction. However, consumer confidence across the United States remains high.
- 79% believe that when they search for a home they will be able to afford it
- 70% say that owning a home is still a big part of the American Dream
- 91% of Americans buying or selling a home in the next 12 months would consider selling by owner
2. Increase in Inventory Will Shift Market to Buyers’ Advantage
While 2013 and 2014 were dream scenarios for sellers, a noticeable shift is taking place that may very soon give buyers more power. Signs pointing to this shift include a less frenzied purchase process, more moderate price increases and improved consumer optimism.
- 64% of U.S. consumers who have sold by owner in the past agree that now is a good time to buy a home in their area
- 56% of by owner sellers believe that 2015 and 2016 will be a buyer’s market
3. Smartphones and Data Empower Home Buyers to Go Agent-less
The digital age has empowered consumers with access to more information than ever before. This is certainly true for the home buying process as 92% of consumers search for homes online. This rise in information right at your fingertips has also increased by-owner home sales.
- 27% of total searches related to buying a home came from mobile phones in June 2014 – up 19% over last year
- Mobile queries for open houses grew 36% in June 2014 over last year
- 32% of Americans are more likely to consider selling by owner than they were a year ago
4. Real Estate Agents’ Roles Being Redefined
Just as the Internet has given the consumer more autonomy and power in the process of home buying and selling, it has also changed the role of the real estate agent. Less than half of Americans agree that the service agents provide is worth the fee, which means that as the digital revolution continues to change the way people buy and sell homes, it will only be more critical for real estate agents to stay relevant in the marketplace.
- ForSaleByOwner.com sellers’ average home sale price is $255,000, 8.5% higher than the typical agent-assisted selling price of $235,000
- ForSaleByOwner.com sellers consistently receive 97% of their asking price, in line with agent-assisted home sales
- 17% of total Americans have previously sold a home by owner, with 88% stating they would sell by owner again
5. Gen X Bearing the Burden of the Housing Crisis
There is a clear generational divide when it comes to motivations and intentions around home buying. Confidence among Baby Boomers continues to improve, while true homeownership rates for Gen Xers are at their lowest level in two decades. Although Millennials are hesitant to buy (64% are still renters), their outlook and decisions will shape the market in the years to come.
- 21.6% of 18 to 34-year-olds said they planned to purchase a home in the next year compared to 13.6% of 35 to 54-year-olds
- Nearly 70% of Millennials believe owning a home is still a big part of the American Dream
- 35% of Millennials believe that the general value of real estate agents is diminishing
- 67% would consider selling by owner
6. Bright Lights, Big Cities: Urbanization Shows No Signs of Slowing
The trend toward urbanization isn’t slowing down anytime soon as Millennials and Gen Xers either currently live in a big city or intend to do so in the next two to three years. While there has been much anecdotal evidence pointing to Boomers’ inclination to move away from the suburbs to the cities, the number of Boomers living in single-family homes in the suburbs today is at least as high as before the housing bust.
View and download the entire report here.