According to the 2020 Home Buyers and Sellers Generational Trends Report, published by the National Association of Realtors (“NAR”), the next generation of home buyers is likely to be millennials, without children, who are high earners. All of these characteristics make sense, as millennials are coming to the age where they have high-income positions, and no children means more liquid assets – this is necessary in light of the fact that home prices are skyrocketing.
80% of today’s home buyers have a minimum of an associate’s degree, which explains the stable finances (though we understand a college degree is not the only path to financial success). The national median home price is $257,000 (up from $250,000), and the national median household income of home buyers is $93,200 (as of 2018, which is up 1.7% from 2017). Further, 61% of home buyers were married, while just 9% were unmarried couples. Of note, single women made up about 17% of the home buyers (down 1% from 2019), and 9% were single men (unchanged from 2019).
Millennials purchased over one-third of the available housing inventory (38% to be exact), and 86% of those millennials were first-time buyers.
Looking at sellers, the picture is not particularly surprising. Sellers are generally comprised of Generation X or older baby boomers looking for their final homes. Given that the housing inventory is so low, most sellers were able to obtain 99% of their final asking price, but about 40% of them had to lower their price at least one time prior to closing the deal. Of note, sellers made an average profit of $60,000 (so capital gains taxes aren’t at issue).
At the Chernov Team we understand that knowledge is power and knowledge of the market is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.