Zillow’s 2018 Consumer Market Trends Index is loaded with information for agents, sellers and buyers alike. Though we’ve gone into depth in several aspects of this index in other posts this week, here are some key take a ways for agents, sellers and buyers alike.
Generation Z and Millennial demographic groups, ages 18 – 38 years, are driving the 2018 housing market and together represent 46% of its buying consumers. Millennials themselves represent 42% of the nation’s buyers. These are persistent buyers who are simultaneously becoming veteran sellers. These two groups tend to gravitate towards urban locales and to suburbs to raise their families.
Buyers and sellers alike consider trustworthiness to be the number one quality they value when selecting their real estate agent. And 86% of both buyers and sellers want real estate agents to handle the paperwork, find the buyers and lead contract negotiations.
How do buyers/sellers determine trustworthiness in agents? 81% say that determination happens in seconds when they are talking with and/or meeting the agent for the very first time. (Please refer to past posts on creating great “first impressions” and Malcolm Gladwell. And please remember that creating and maintaining eye contact are fundamental.)
An “everything old is new again” element of the 2018 housing market is including contingencies in offers. Just a few months ago, no one thought about, let alone brought up, contingency concerns regarding inspections, financing, repairs, etc. Now, in this currently softening market, contingencies and knowing how to prioritize and negotiate contingencies are big chunks of what agents are responsible to do for their clients.
Housing consumers of all ages are becoming more flexible in their lists of wants and needs in a home as the market at all price levels is softening. What are they compromising in 2018?
- 83% of sellers make concessions regarding contingencies.
- 61% of sellers drop their original list price once.
- 31% of sellers drop their price twice.
- 29% drop their price three or more times.
- .51% of buyers compromise on their choice of home in order to stay within their budget.
- 31% of buyers compromise on preferred finishes. 30% of buyers compromise on the size of home and buy smaller.
- 29% of buyers compromise by accepting longer commutes.
Affordability remains a key issue for all housing consumers.
- Renters are concerned about saving enough money for a down payment all the while 52% of renters say they could not cover an unexpected expense of $1,000.
- Buyers are concerned about qualifying for and being able to pay for monthly mortgage payments now that rising interest rates are making it more expensive to pay for home ownership.
- Sellers are concerned about selling their homes at their desired price before the market falls below their expectations.
- Homeowners are concerned that the home in which they made a financial investment may no longer hold up to that investment.
All this being said, 83% of all housing consumers LOVE their homes.