A closer look at who bought and sold homes in Ohio, nationally last year
Buying a primary residence for home buyers is a financial decision, but also an emotional decision that involves many lifestyle factors. For most home buyers, the purchase of a primary residence is one of the largest financial transactions they will make. Buyers purchase a home not only for the desire to own a home of their own, but also because of changes in jobs, family situations, and the need for a smaller or larger living area. This annual survey, conducted by the National Association of REALTORS of recent home buyers and sellers, helps to gain insight into detailed information about their unique experience with this transaction. The information provided supplies understanding, from the consumer level, of the trends that are transpiring. The survey covers information on demographics, housing characteristics, and the experience of consumers in the housing market. Buyers and sellers also provide valuable information on the role that real estate professionals play in home sales transactions.
The Profile of Home Buyers and Sellers report has been the leading industry source of trusted insight into consumer behavior for nearly four decades. It has grown and evolved to keep up with changing home buying trends and the need for more information.
The Ohio Division of Real Estate & Professional Licensing, at the request of Ohio REALTORS, fundings the oversampling of Ohio consumers and enabled the creation of the Ohio-specific report.
Data is collected from a nationally representative sample of recent home buyers who purchased a primary residence in the 12-month period between July and June. Data is also representative of the geographic distribution of home sales. Consumer names are obtained from Experian, a firm that maintains an extensive database of recent home buyers derived from county records.
National Report Highlights
In 2019, the share of first-time home buyers was 33 percent, holding steady from 33 percent last year. This figure has gravitated away from the historical norm at 40 percent of the market. The median household income increased again this year, likely due to a nationwide increase in home prices caused by a lack of housing inventory, pushing out lower-income buyers. Married and unmarried couples have double the buying power of single home buyers in the market and may be better able to meet the price increases of this housing market. Repeat buyers are also returning to the market.
Tightened inventory is affecting the home search process of buyers. Due to suppressed inventory levels in many areas of the country, buyers are typically purchasing more expensive homes as prices increase. The number of weeks a buyer searched for a home remained at 10 weeks. Buyers continue to report the most difficult task for them in the home buying process was just finding the right home to purchase.
Increased prices are also impacting sellers. Tenure in the home remained at a high of 10 years this year. Historically, tenure in the home has been six to seven years. Sellers may now have the equity and buyer demand to sell their home after stalling or delaying their home sale.
Buyers needed the help of a real estate professional to help them find the right home for them, negotiate terms of sale, and help with price negotiations. Sellers, as well, turned to professionals to help market their home to potential buyers, price their home competitively, and sell within a specific timeframe. For-sale-by-owner sales have remained near the lowest level recorded in this data set at eight percent of sales again this year, while the use of the agent to buy the home reached a historic high of 89 percent, as the number of buyers purchasing directly from a previous owner or through a builder fell. Likewise, the seller’s use of the agent remains near historic highs.
This report provides real estate professionals with insights into the needs and expectations of their clients. What do consumers want when choosing a real estate professional? How do home buyers begin the process of searching for a home? Why do some sellers choose to forego the assistance of an agent? The answers to these questions, along with other findings in this report, will help real estate professionals better understand the housing market and provide the information necessary to address the needs of America’s real estate consumers.
Ohio Report Highlights
Characteristics of Home Buyers
- First-time buyers made up 33 percent of all home buyers, the same as last year. In Ohio, 30 percent were first-time buyers.
- The typical buyer was 47 years old this year, and the median household income for 2018 rose again this year to $93,200. In Ohio, buyers were 32 years old and have a median income of $104,700.
- Sixty-one percent of recent buyers were married couples, 17 percent were single females, 9 percent were single males, and nine percent were unmarried couples. In Ohio, 56 percent were married couples, 19 percent were single females, 11 percent were single males, and 11 percent were unmarried couples.
- Twelve percent of home buyers purchased a multi-generational home, to take care of aging parents, because of children over the age of 18 moving back home, and for cost savings. In Ohio, that share was 10 percent.
- Ninety-one percent of recent home buyers identified as heterosexual, 3 percent as gay or lesbian, 1 percent as bisexual, and 5 percent preferred not to answer. In Ohio, 93 percent identified as heterosexual, and 2 percent as gay or lesbian.
- Twenty percent of recent home buyers are veterans and three percent are active-duty service members. Twenty-one percent are veterans and 2 percent are active-duty service members in Ohio.
- At 29 percent, the primary reason for purchasing a home was the desire to own a home of their own. In Ohio, this was 29 percent.
Characteristics of Homes Purchased
- Buyers of new homes made up 13 percent and buyers of previously owned homes made up 87 percent. In Ohio, this share is 4 percent for new homes and 96 percent for previously owned homes.
- Most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or electricity at 39 percent. Buyers who purchased previously-owned homes were most often considering a better overall value at 33 percent. In Ohio, 38 percent of new home buyers were looking to avoid renovations or problems with plumbing or electricity and 34 percent of previously owned homes were looking for a better overall value.
- Detached single-family homes continue to be the most common home type for recent buyers at 83 percent, followed by 6 percent of buyers choosing townhomes or row houses. In Ohio, buyers bought single-family homes at 84 percent.
- Senior-related housing decreased this year to 12 percent, with 20 percent of buyers typically purchasing condos and 9 percent purchasing a townhouse or row house. Six percent bought senior-related homes in Ohio.
- There was a median of only 15 miles between the homes that recent buyers purchased and the homes that they moved from. In Ohio, it was 10 miles.
- Home prices increased slightly this year to a median of $257,000 among all buyers. Buyers typically purchased their homes for 98 percent of the asking price. In Ohio, the median home price was $141,500 at 97 percent of the asking price.
- The typical home that was recently purchased was 1,850 square feet, had three bedrooms and two bathrooms, and was built in 1990. In Ohio, the typical home was 1,650 square feet and built in 1969.
- Overall, buyers expect to live in their homes for a median of 15 years, while 20 percent say that they are never moving. In Ohio, that number is 20 years.
The Home Search Process
- For 44 percent of recent buyers, the first step that they took in the home buying process was to look online at properties for sale, while 16 percent of buyers first contacted a real estate agent. In Ohio, 48 percent looked online first and 12 percent contacted a real estate agent.
- Eighty-seven percent of recent buyers found their real estate agent to be a very useful information source. Online websites were seen as the most useful information source at 93 percent. Eighty-five percent found real estate agents and 95 percent found websites very useful in the home search process in Ohio.
- Buyers typically searched for 10 weeks and looked at a median of nine homes. In Ohio, buyers searched for 10 weeks and looked at seven homes.
- The typical buyer who did not use the internet during their home search spent only four weeks searching and visited four homes, compared to those who did use the internet and searched for 10 weeks and visited 10 homes. In Ohio, those who did not search the internet looked at two homes over one week.
- Among buyers who used the internet during their home search, 87 percent of buyers found photos and 85 percent found detailed information about properties for sale very useful. In Ohio, 85 percent found photos very useful in their home search process.
- Sixty-three percent of recent buyers were very satisfied with their recent home buying process, up from 62 percent a year ago. In Ohio, 63 percent were very satisfied with the process.
Home Buying and Real Estate Professionals
- Eighty-nine percent of buyers recently purchased their home through a real estate agent or broker, and 5 percent purchased directly from a builder or builder’s agent. In Ohio, 85 percent purchase through a real estate agent.
- Having an agent to help them find the right home was what buyers wanted most when choosing an agent at 52 percent. In Ohio, 52 percent worked with an agent to find the right home.
- Forty-one percent of buyers used an agent that was referred to them by a friend, neighbor, or relative and 12 percent used an agent that they had worked with in the past to buy or sell a home. In Ohio, 30 percent used referrals to find their real estate agent.
- Seventy-five percent of buyers interviewed only one real estate agent during their home search. In Ohio, this was 72 percent.
- Ninety percent of buyers would use their agent again or recommend their agent to others. Eighty-eight percent would recommend their agent again in Ohio.
Financing the Home Purchase
- Eighty-six percent of recent buyers financed their home purchase on a national level and 78 percent in Ohio. Those who financed their home purchase typically financed 88 percent and in Ohio it was 90 percent.
- First-time buyers who financed their home typically financed 94 percent of their home compared to repeat buyers at 84 percent. In Ohio, the share was 95 percent of first-time buyers and 85 percent of repeat buyers.
- For 60 percent of buyers, the source of the downpayment came from their savings. Thirty-eight percent of buyers cited using the proceeds from the sale of a primary residence, which was the next most commonly reported way of securing a downpayment. In Ohio, 64 percent used savings and 29 percent used proceeds from sale of a primary residence.
- For 13 percent of buyers, the most difficult step in the home buying process was saving for a downpayment. In Ohio, 12 percent said saving was the most difficult step.
- Of buyers who said saving for a downpayment was difficult, 51 percent of buyers reported that student loans made saving for a downpayment difficult. Forty-five percent cited credit card debt, and 38 percent cited car loans as also making saving for a downpayment hard. In Ohio, 43 percent reported having student loan debt, 36 percent had credit card debt, and 50 percent had car loans.
- Buyers continue to see purchasing a home as a good financial investment. Eighty-one percent reported they view a home purchase as a good investment and 76 percent in Ohio.
Home Sellers and Their Selling Experience
- The typical home seller was 57 years old, with a median household income of $102,900. In Ohio, the median age was 61 years with a median income of $86,900.
- For all sellers, the most commonly cited reason for selling their home was the desire to move closer to friends and family (16 percent), followed by that it was too small (13 percent), and a job relocation (11 percent). In Ohio, the reasons were desire to move closer to friends and family (19 percent), followed by the home was too small (11 percent), neighborhood has become less desirable (11 percent), and home is too large (10 percent).
- Sellers typically lived in their home for 10 years before selling, up from last year. In Ohio, sellers sold after 13 years.
- Eighty-nine percent of home sellers worked with a real estate agent to sell their home and 89 percent in Ohio.
- For recently sold homes, the final sales price was a median 99 percent of the final listing price and in Ohio it was 98 percent.
- Recently sold homes were on the market for a median of three weeks, the same as last year, and two weeks in Ohio.
- Thirty-four percent of all sellers offered incentives to attract buyers; this was 37 percent in Ohio.
- This year, home sellers cited that they sold their homes for a median of $60,000 more than they purchased it. In Ohio, the median was $45,000.
- Sixty-six percent of sellers were very satisfied with the selling process and 62 percent in Ohio.
Home Selling and Real Estate Professionals
- Sixty-six percent of sellers found their agent through a referral from a friend, neighbor, or relative or used an agent they had worked with before to buy or sell a home. In Ohio, that figure was 65 percent.
- Seventy-five percent of recent sellers contacted only one agent before finding the right agent they worked with to sell their home. In Ohio, it was 73 percent.
- Eighty-nine percent of sellers listed their homes on the Multiple Listing Service (MLS), which is the number one source for sellers to list their home. In Ohio, it was 77 percent.
- Seventy-five percent of sellers reported that they provided the agent’s compensation and also at 75 percent in Ohio.
- The typical seller has recommended their agent once since selling their home. Thirty-six percent of sellers recommended their agent three or more times since selling their home. In Ohio, this share was 35 percent.
- Seventy percent said that they would definitely (48 percent) or probably (22 percent) recommend their agent for future services. In Ohio, 71 percent said definitely and 19 percent said probably.