Description

Providing the most comprehensive and up-to-date information and analysis of the US Home Purchasing market including the behaviors, preferences, and habits of the consumer.

The pandemic shed new light on traditional benefits of owning a home and upended the home buying process in ways that will likely stay relevant for years. Work-from-home flexibility created new types of housing demand, and the need to stay isolated expedited trends taking more of the buying process online.

The housing market is very active in 2021, with prices booming and over one third of consumers likely to buy or sell a home in the next year (including 15% who are very likely). The prospective homebuyer engages in the process with a diverse set of needs based on their situation; yet in most cases, buying a home remains a significant and stressful experience. Marketers that can meet the needs of consumers in this new environment and make the home buying process easier will stand out.

Read on to discover more about the US Home Purchasing consumer market, read our US Property & Casualty Insurance Market Report 2021, or take a look at our other Financial Services research reports.

Quickly understand

  • The impact of COVID-19 on consumer behavior and the housing market.
  • Online search tools and how they have impacted the home buying process.
  • First time home buyer trends, and millennial home buying trends.
  • Reasons why (and why not) consumers decide to move, and what features they are looking for.
  • Differences in the buying process between first-time homebuyers and existing homeowners.

Covered in this report

Brands include: Sotheby’s, Redfin, Divvy, Zillow, HGTV, VR Home.

Expert analysis from a specialist in the field

This report, written by Amr Hamdi, a leading analyst in the Finance sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Throughout the pandemic, the increase in remote work, desire for more personal space, and low mortgage rates have all fueled the surge in housing demand. While consumers have been eager to take advantage of the low rates, supply constraints and inventory shortages have caused an imbalance between demand and supply – sending home prices surging among frenzied demand. With this surge in inflated prices, the affordability of purchasing a home widened, and could be a lingering challenge for potential homebuyers moving into 2022 – especially a Millennial generation entering their peak years for first-time homeownership.
Amr Hamdi, Finance Analyst
Amr Hamdi
Finance Analyst

Table of Contents

  1. Overview

    • What you need to know
      • This Report looks at the following areas
        • Definition
          • Market context
            • Economic and other assumptions
              • COVID-19: US context
              • Executive Summary

                  • Top takeaways
                    • A quarter of consumers find saving for a down payment difficult
                      • Figure 1: Opinion on saving for a down payment, by generation, 2021
                    • The agent and customer relationship continues to drive home purchase
                      • Figure 2: Mortgage lender shopping, 2021
                    • Explore emerging technologies to expedite the home purchase process
                      • Figure 3: Home searching online, 2021
                    • Market overview
                      • Impact of COVID-19 on home purchasing
                        • Figure 4: Short-, medium- and long-term impact of COVID-19 on home purchasing, 2021
                      • Opportunities and challenges
                        • Short term
                          • Recovery
                          • The Market – Key Takeaways

                            • Home ownership passes 65% for ten-year high
                              • Home prices soar amid perfect market storm of supply and demand
                                • Market demand shifts away from cities
                                • Market Factors

                                  • Home ownership rate increases to highest in ten years
                                    • Figure 5: Total US home ownership rate, 2010-2020
                                  • Mortgage rates near all-time lows
                                    • Figure 6: Average 30 year mortgage rate, 2010-2021
                                  • Home prices soar as low rates and remote work spur demand
                                    • Figure 7: Median sales price of houses sold for the US, dollars, quarterly, not seasonally adjusted, 2011-2021
                                  • Housing inventory rebounding from low
                                    • Figure 8: Monthly supply of houses in the US, months’ supply, monthly, seasonally adjusted, 2010-2021
                                  • Work from home shifts market demand away from cities
                                  • Companies and Brands – Key Takeaways

                                    • 3D and VR tours make in-person tours less important
                                      • Divvy homes to bring rent to own to masses
                                        • Zillow Offers begins “institutionalizing” home buying
                                        • Competitive Strategies

                                          • Sotheby’s & Redfin’s 3D and VR tours foreshadow future digital buying process
                                            • Figure 9: Redfin ad, 2020
                                          • Divvy homes to bring rent to own to masses
                                            • Figure 10: Divvy Homes YouTube ad, 2020
                                          • Zillow Offers removes the hassle of selling homes
                                            • Figure 11: Zillow Offers ad, 2021
                                        • The Consumer – Key Takeaways

                                          • Consumers strive for “American Dream” of home ownership
                                            • Active market for buyers and sellers
                                              • Locality is key in home purchasing process
                                                • Online tools adding to in-person buying process
                                                  • Many unhappy with home, yet hesitant to move
                                                  • Home Purchasing Process

                                                    • Nearly two thirds of US consumers own their own home
                                                      • Figure 12: Home purchasing involvement, 2021
                                                    • Home purchasing decisions often shared
                                                      • Figure 13: Home purchasing involvement, 2021
                                                    • Men more likely to decide for themselves
                                                      • Figure 14: Home purchasing involvement, by gender, 2021
                                                    • Millennials making decisions on own
                                                      • Figure 15: Home purchasing involvement, by generation, 2021
                                                    • More optimistic consumers decide for themselves
                                                      • Figure 16: Home purchasing involvement, by financial outlook, 2021
                                                  • First-time Home Purchase

                                                    • Half of home buyers are first-time purchasers
                                                      • Figure 17: Saturday Night Live “Zillow” skit
                                                      • Figure 18: First-time home purchase, 2021
                                                    • Nearly half of Gen Xers were first-time buyers
                                                      • Figure 19: First-time home purchase, by generation, 2021
                                                    • City dwellers more likely to be first-time buyers
                                                      • Figure 20: First-time home purchase, by area of residence, 2021
                                                    • Nearly 70% of parents are first-time homebuyers
                                                      • Figure 21: First-time home purchase, by parental status, 2021
                                                  • Types of Homes Considered

                                                    • Three quarters considered previously owned homes
                                                      • Figure 22: Types of homes considered, 2021
                                                    • New construction most appealing to Gen Z
                                                      • Figure 23: Types of homes considered, by generation, 2021
                                                    • Fixer-uppers may be attractive to those with less income
                                                      • Figure 24: Types of homes considered, by household income, 2021
                                                    • New construction popular in cities
                                                      • Figure 25: Types of homes considered, by area of residence, 2021
                                                    • Opportunity to reach renters of single-family homes
                                                      • Figure 26: Homes considered for future purchase, by current residence, 2021
                                                  • Mortgage Lending

                                                    • Referrals drive mortgage lending
                                                      • Figure 27: Mortgage lender shopping, 2021
                                                    • Hints of online success for younger audience
                                                      • Figure 28: Mortgage lender shopping, by generation, 2021
                                                  • Likelihood of Home Purchase

                                                    • One third of consumers likely to buy or sell home
                                                      • Figure 29: Likelihood of home purchase, 2021
                                                    • Men more likely to buy soon
                                                      • Figure 30: Likelihood of home purchase, by gender, 2021
                                                    • Millennials very likely to buy in next year
                                                      • Figure 31: Likelihood of home purchase, by generation, 2021
                                                    • Parents looking to buy soon
                                                      • Figure 32: Likelihood of home purchase, by parental status, 2021
                                                    • Relocation key driver for home purchase
                                                      • Figure 33: Likelihood of home purchase, by major life events in next year, 2021
                                                  • Length of Home Ownership

                                                    • Consumers get comfortable in homes as they age
                                                      • Figure 34: Length of home ownership, by generation, 2021
                                                    • Expecting parents may be hungry for change
                                                      • Figure 35: Length of home ownership, by parental status, 2021
                                                  • Area of Purchase

                                                    • Majority of buyers stay in similar area
                                                      • Figure 36: Area of purchase, 2021
                                                    • Moving to suburbs attracts some Gen Zers
                                                      • Figure 37: Area of purchase, by generation, 2021
                                                  • Home Searching Online

                                                    • Most believe it’s important to visit in person
                                                      • Figure 38: Home searching online, 2021
                                                    • Millennials doing most searching online
                                                      • Figure 39: Home searching online, by generation, 2021
                                                  • Home Purchasing Attitudes

                                                    • Just half of consumers happy with current home
                                                      • Figure 40: Home purchasing attitudes, 2021
                                                    • Cultural importance of homes lessening with young generations
                                                      • Figure 41: Home purchasing attitudes, by generation, 2021
                                                    • Less-wealthy consumers open to homes needing repair
                                                      • Figure 42: Home purchasing attitudes, by household income, 2021
                                                  • Appendix – Data Sources and Abbreviations

                                                    • Data sources
                                                      • Sales data
                                                        • Consumer survey data
                                                          • Abbreviations and terms
                                                            • Abbreviations

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