What are the motivations of today’s home seller and where are they moving to?
That’s what revealed in the National Association of Realtors (NAR) Home Buyer and Seller Generational Trends Report, which takes a look at the home selling motivations and experiences of five different generations of the American public. The report is based on a July 2014 survey that had a response from 72,206 recent homebuyers. Here are the key takeaways from the report on the American home seller:
Before we jump into the lingo of demographic groups, it’s important to understand how each one is identified. According to the NAR report:
- The Silent Generation identifies those born between 1925 and 1945;
- Older Boomers are those born between 1946 and 1954;
- Younger Boomers are those born between 1955 and 1964;
- Generation X are those born between 1965 and 1979; and
- Generation Y (Millennials) are those who were born between 1980 and 2000.
Gen X is the largest group of recent home sellers at 27 percent, followed by older Boomers at 23 percent and younger Boomers at 20 percent. There is a clear trend of moving to larger, higher-priced homes for Millennials and Gen Xers, moving into a similar home for younger Boomers and downsizing in older Boomers and the Silent Generation.
It makes sense that Gen X has the largest group of home sellers — this group wanted to sell sooner, but had the highest amount of sellers who were stalled (23 percent) because their homes were worth less than their mortgages. Gen X typically owned their home for five years before selling and had the largest share of married couples selling their home.
Older Boomers and the Silent Generation owned their homes for a longer period of time, generally for 13 years and were primarily motivated to sell their homes to be closer to friends and family and to downsize. These buyers were more likely to move further distances and in a different state than where their home was sold. Younger Boomers moved into a similar home. Baby Boomers had the lowest share of married couples. Older Boomers had the highest share of single female sellers.
Millennials were most often looking to sell their home so they could upgrade to a larger home or for job relocation. This group had the largest percentage of first-time sellers (75 percent).
How they Sold Their Homes
Sellers typically use “traditional” methods to sell their homes. The top five marketing methods for homes are: MLS websites, yard signs, real estate agent website, open house and a real estate company website.
Following closely behind were Realtor.com, third party aggregators, print and newspaper ads, direct mail and video.
What This Means For You
The report emphasizes how important referrals are for agents. When it came time to sell their home, all groups of sellers were most likely to find their selling agent from a friend/family referral or use an agent that they previously used to buy or sell.
Younger sellers are more likely to use the same agent or broker for their home purchase than older sellers. These sellers also want their selling agent to price their home competitively and help sell their home within a timeframe, while older sellers are more likely to want their agent to help the seller market the home to potential buyers.
Middle-aged sellers are more likely to initiate discussions about compensation with their real estate agent than both younger and older sellers.
It’s important to understand why people sell their house in order to understand where they want to move and what they want in a new home. By displaying an understanding of your client’s motivations and providing good service to them, you can increase your repeat business as well as new clients.