Monday, July 21, 2014
PLACERVILLE, CALIFORNIA
99 CENTS

Survey results from homebuyers and sellers

By
From page C2 | November 25, 2011 |

Ken Calhoon

I am generally skeptical of most opinion surveys. There are far too many surveyors asking us about our opinions on anything and everything and then treating the results as factual. Just because 70 percent of us have a favorable opinion about something doesn’t make it right. Many great leaders ran afoul of public opinion. Jesus Christ, in his day, was certainly in the minority when it came to approval ratings. Opinion surveys have acquired so much credibility they often shape public policy.

Every organization must have a full-time surveying staff producing unnecessary and redundant results. The Building Industry Association surveys their members monthly. Should we be surprised each month to discover builders are feeling pretty lousy about things? The Consumer Confidence Survey reminds us weekly that consumer confidence is at low levels and the latest economic survey shows 75 percent of Americans think our country is on the wrong track. How many surveys does it take to tell us what we already know?

Some surveys I find interesting but I’m not sure what to do with the information. An example is the most recent survey by the National Association of Realtors. NAR released their findings from surveying 81,000 homebuyers and sellers who purchased a home between July of 2010 and June of 2011.

Here are some highlights:

Despite low home prices and interest rates, buyers are staying well under the maximum priced home they could afford. This is a structural change in buyer’s attitude.  An old adage in real estate used to be, “Buy a little more house than you can afford.” The thinking was that the payment would remain the same while a buyer’s income and family grew. That’s changed to “less is more.” Another change is that buyers are making larger down payments. The medium down payment is now 11 percent. That’s up a full percentage point from last year and 5 points above 2006.

The number of first-time buyers fell to 37 percent nationally and 34 percent in California. That’s down from 50 percent and 45 percent in the previous survey. Typically, first-timers would make up 40 percent of all sales. They are critical to a healthy housing market because they buy existing homes, enabling those sellers to trade up. Entry level buyers are finding increasing difficulty in qualifying for their first loan from tight-fisted lenders.

Paul Bishop, NAR vice president of research, points the finger at the banks tight credit policies. “Banks simply needs to get back into the business of lending.”

The typical first-time buyer was 31 years old with a median income of $62,400. They purchased a three-bedroom home with 1,570 square feet, costing $155,000, using a FHA loan (54 percent) or VA loan (6 percent). First-time buyers utilized a variety of sources for their down payment, including personal savings (79 percent), gifts from relatives and friends (26 percent), sold stocks or bonds (9 percent) borrowed against their 401 (k) fund (8 percent) and a personal loan from a friend or relative (7 percent). Ninety-four percent of entry-level buyers chose a 30-year fixed rate mortgage.

The typical repeat buyer was 53 years old, earned $96,600 and purchased homes with 2,100 square feet costing $219,500.

Buyers searched an average of 12 weeks and visited 12 homes prior to their purchase decision. Single-family detached homes accounted for 77 percent of all purchases and 51 percent of them were in a suburb or subdivision, 18 percent in an urban area, 18 percent in a small town, 11 percent in a rural area and 3 percent in a resort or recreation community. The median distance from the previous residence was 12 miles. A majority of buyers considering purchasing an REO but didn’t buy one for a variety of reasons: Couldn’t find the right house (29 percent) poor condition (15 percent) and a difficult process (15 percent).

The typical seller was 53 years old with an income of $101,500 who moved a median distance of 20 miles from their home where they had lived the last nine years. Forty-six percent moved into a larger home, 31 percent bought a comparable size home and 23 percent downsized. The typical seller who had purchased their home nine years earlier realized a gain of $26,000. Twenty-two percent of California home sellers lost money from the sale of their home.

Eighty-nine percent of survey respondents used a real estate agent for their sale or purchase while 7 percent purchased directly from the builder and 4 percent directly through the previous owner. Both buyers and seller most likely selected their agent based upon a referral from a friend or relative, with trustworthiness and reputation being the most important factor. Eighty-nine percent said they were likely to use the same agent again or recommend them to others.

While 78 percent of recent homebuyers said their home is a good investment, only 38 percent of California sellers said they planned to purchase another home. That’s actually an improvement from only 30 percent in the 2010 survey but substantially down from the 70 percent in 2005 that said they would be buying another home.

One-third of all California sellers said the reason they sold their home was because they were financially distressed. That number was up slightly from 2010. Let’s hope that survey number declines by this time next year.

Ken Calhoon is a real estate broker in El Dorado County. He can be reached through his Website at kencalhoon.com and via e-mail at ken@kencalhoon.com.

Comments

comments

.

News

Highway 50 collision fatal

By Cole Mayer | From Page: A1

 
IRS unveils Taxpayer Bill of Rights

By News Release | From Page: B1

EDH community unites to patch up historic barn

By Mike Roberts | From Page: A1 | Gallery

 
Stay connected through sheriff

By El Dorado County Sheriff's Office | From Page: B1

Bird tests positive for West Nile

By Ross Branch | From Page: A1

 
P’ville hires Camino superintendent

By News Release | From Page: B1

 
Heard over the back fence: Public swim times announced

By Bob Billingsley | From Page: B1

County gets partial refund on promotional event

By Dawn Hodson | From Page: A3

 
Jeepers expo Wednesday in Georgetown

By Dawn Hodson | From Page: A3

Help SWR with squirrel babies

By Sierra Wildlife Rescue | From Page: A9

 
.

Opinion

The rural life: Save the day: Neuter and spay

By Jennifer Forsberg Meyer | From Page: A4

 
Different place, different priorities

By Mountain Democrat | From Page: A4

California rambling: Giving cities a pass

By John Poimiroo | From Page: A4 | Gallery

 
.

Letters

Ready for Hillary?

By Letters to the Editor | From Page: A5, 2 Comments

 
Fukushima

By Letters to the Editor | From Page: A5

Diamond Springs Firefighters Union is corrupt

By Letters to the Editor | From Page: A5, 1 Comment

 
100+ years and thanks

By Letters to the Editor | From Page: A5

A thank you note

By Letters to the Editor | From Page: A5, 1 Comment

 
Prada belongs in Berkeley

By Letters to the Editor | From Page: A5

.

Sports

Sports Scene: July 20, 2014

By Jerry Heinzer | From Page: A6

 
Roundup: July 20, 2014

By Democrat Staff | From Page: A6

Season over for Post 119

By Mike Bush | From Page: A6 | Gallery

 
Valley View Sports Park

By Julie Samrick | From Page: A6 | Gallery

Under the Scoreboard: July 20, 2014

By Democrat Staff | From Page: A6

 
Schedule: July 21-26

By Democrat Staff | From Page: A6

Becker slips by in wild KWS finish

By Gary Thomas | From Page: A6

 
Sophia Barden wins strut title

By Special to the Democrat | From Page: A7

.

Prospecting

How to safely help a horse

By Wendy Schultz | From Page: B2 | Gallery

 
Railroad Museum offers a fun ‘History Happy Hour’

By California State Railroad Museum | From Page: B4

 
As we were: Money for home repairs

By Ken Deibert | From Page: B4

Volunteer kitchen help needed in EDH

By Health and Human Services Agency | From Page: B10

 
Marshall Medical Center to host day of fitness and fun

By Marshall Medical | From Page: B10

 
Kids parade for free admission to the fair

By Amador County Fair | From Page: B10

.

Essentials

Crime Log: July 6-8

By Cole Mayer | From Page: A2

 
.

Obituaries

Betty Ellene Hock

By Contributor | From Page: A2Comments are off for this post

 
Douglas J. Beam

By Contributor | From Page: A2

Jerry Grant Young Jr.

By Contributor | From Page: A2

 
Kathryn Noreen Nolan

By Contributor | From Page: A2

.

Real Estate

.

Comics

Speed Bump

By Contributor | From Page: A8

 
American Profile Crossword

By Contributor | From Page: A8

Tundra

By Contributor | From Page: A8

 
Horoscope, Tuesday, July 22, 2014

By Contributor | From Page: A8

Horoscope, Monday, July 21, 2014

By Contributor | From Page: A8

 
Shoe

By Contributor | From Page: A8

Sukodu

By Contributor | From Page: A8

 
Rubes

By Contributor | From Page: A8

New York Times Crossword

By Contributor | From Page: A8

 
TV Listings

By Contributor | From Page: A8