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THE HOME BUYERS OFTOMORROWWHATMILLENNIALS REALLY WANTPresented byCarmen Hirciag, MBASenior Research Analyst
Survey Methodology
1,000 online surveys conducted in Aug 2014
Respondents: CA residents, age 18-34
WHO ISTHETYPICALMILLENNIAL?Demographics
Famous Millennials
genY! echo boomers! generation next!
1980-1996
3 out of4
1 out of5 80%
20 texts/day
18-34 11million
56%
computers
Typical Millennial
24Years Old
28%College
Educated
62%Minority
50%Single
$35KMedianIncome
MedianAge: 24
What is your age?
0%
2%
4%
6%
8%
10%
12%
18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34
11%
9%
7% 7%6%
6%
7%
5%6%
4% 4%5%
6%
4% 4% 4% 4%
Age (Years)
Millennials Not Married
What is your marital status?
Married 26%
Single 50%
In a committedrelationship
23%
Other 2%
Marital StatusVaries by Age Group
23% 21% 23%
62%
29%
50%
13%
47%
26%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
18-26 27-34 All
Married
Single
In a committed relationship
Other
*Source: 2013 American Community Survey, U.S. Census BureauWhat is your marital status?
Education
*Source: 2013 American Community Survey, U.S. Census BureauWhat is the highest level of education you have completed?
6%
22%
38%
23%
4%
11%
36%
27%
11%
3%
3%
14%
44%
30%
4%
0% 10% 20% 30% 40% 50%
Graduate school
Four-year college
Some College
High school
Some High school
18-26
27-34
All
62% are Minorities
What is your ethnic background?
0%
5%
10%
15%
20%
25%
30%
35%
40%
Caucasian/White
Hispanic/ Latino Asian AfricanAmerican
Other
38%35%
18%
7%
4%
1/2 Millennials are Employed
Student 24%
Unemployed20%
Employed 52%
Other 3%
What is your employment status?
Majority Employed
What is your employment status?
2% 5% 3%
43%
68%
52%
20%
21%
20%
35%
6%
24%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
18-26 27-34 All
Student
Unemployed
Employed
Other
Only 1/3 Millennials Have FullTime Jobs
What is your employment status?
3%
33%
19%
14%
6%
20%
4%
0% 5% 10% 15% 20% 25% 30% 35%
Other
Full time
Part time
Unemployed, looking for a job
Unemployed, not looking for work
Full time student
Part time student
Employment StatusVaries byAge Group
What is your employment status?
3%
33%
19%
14%
6%
20%
4%
5%
54%
14%
13%
8%
2%
4%
2%
22%
21%
15%
5%
5%
30%
0% 10% 20% 30% 40% 50% 60%
Other
Full time
Part time
Unemployed, looking for a job
Unemployed, not looking for work
Full time student
Part time student
18-26
27-34
All
Top Millennial Professions
What is your profession?
MedianYears in Current Job: 2
How many years have you been in your current job?
0%
5%
10%
15%
20%
25%
Majority Earn Less than $40k/Year
What is your annual household income?
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%18%
15% 15%
11%
10%
5%4%
7%
3%
6%5%
3%
Income (In Thousands)
Older Millennials Have Higher Earnings
$0
$10,000
$20,000
$30,000
$40,000
$50,000
18-26 27-34 All
$30,000
$50,000
$35,000
Age Group
Median Annual Household Income
What is your annual household income?
Nearly 2/5 Millennials Live w/Parents
What is your current living situation?
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
I rent I live with myparents
I own I live in a dorm Other:
41%
36%
20%
1%1%
Nearly of 18-26Year Olds Live w/Parents
What is your current living situation?
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
I own I rent I live with myparents
I live in a dorm Other:
11%
37%
49%
2% 2%
38%
49%
12%
1%
20%
41%
36%
1% 1%
18-26
27-34
All
Slightly More than Half Live in Single Family Homes
In which type of home do you currently live?
Single family55%
Multifamily42%
Other3%
> 1/2 Live in Single Family Homes
In which type of home do you currently live?
0%
10%
20%
30%
40%
50%
60%
Single familyhome
Apartment Condo Townhouse Dorm Other
55%
31%
5% 5%
1% 3%
0%
10%
20%
30%
40%
50%
60%
0 1 2 3 4 5 6Number of People
Adults Children
Nearly Half Dont Have Children
How many people live in the home?
Nearly Half Dont Have Children
How many people live in the home?
0%
10%
20%
30%
40%
50%
60%
0 1 2 3 4 5 6
Number of people
Adults Children
18-2627-34
Most Households are Families
Please indicate the relationship between you and the other people living with you.
Family 86%
Roomates 10%
Other 6%
RENTERS
Median Monthly Rent: $1,075
How much is your monthly rent?
0%
2%
4%
6%
8%
10% 9%
7%6%
5%
10%
7%
8%
5%
9%
6%
5%
6%6%
3%
6%
4%
Rent ($)
Affordable Rent isTop Reason forChoosingCurrentResidence
What was the most important reason for electing to live in your current residence?
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Other
Near shopping
Close to public transportation
Amenities
School district
Quiet/privacy
Larger space
Near family
Near work
Near school
I like the neighborhood
Affordable rent
2%
1%
1%
2%
2%
3%
4%
5%
6%
7%
17%
48%
1/10 Renters PreviouslyOwned a Home
Have you ever owned a primary residence?
Yes 12%
No 88%
Majority Sold HomeAfter 2009
What year did you sell your primary residence?
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
4%6%
2%4%
4%
2%
6%
2%
4%
11%
4%
13%
7%
9%
6%
20%
Many Sold Home Due to Financial Distress
Why did you sell your previous primary residence?
0% 5% 10% 15% 20% 25% 30% 35% 40%
Other
Believe housing market is going down
Recent rise in home values
Opted to become a renter
Needed to move for work
Needed to move for family reasons
Financial distress
12%
2%
7%
10%
22%
24%
39%
Majority Rent Because theyCantAfford to Buy
Why do you rent instead of buying?
2%
4%
7%
9%
10%
15%
16%
17%
20%
24%
37%
67%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Other
Believe housing market will decline in the near future
No interest in buying
Don't want the responsibility of owning
Don't have a job
Enjoy the flexibility/freedom of renting
Too costly to maintain property as owner
Can't qualify for a mortgage
Don't have a down payment
It's easier to rent
Not ready to buy
Can't afford to buy
Most Expect to Buy a HomeWithin 5Years
When do you expect to buy a home?
0%
5%
10%
15%
20%
25%
30%
35%
Within ayear
In 1-3years
In 3-5years
When Iget
married
When Ihave achild
Never Other Don'tknow
18-26
27-34
All
Affordable Home Price is #1 Motivator to Buy Now
What would most motivate you to buy a home now?
0% 5% 10% 15% 20% 25% 30% 35% 40%
Other
Tax incentives
Favorable interest rates
Improvement in credit score
Nothing, I don't want to buy a home
Starting a family
Improvement in finances
Having money for down payment
Affordable home price
2%
1%
4%
4%
9%
13%
15%
16%
36%
Most Plan to Buy Locally
Where do you plan to buy your next primary residence?
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Don't know/unsure
Another country
Another state
In another county in California
In the same neighborhood where I currently reside
Within the same county where I currently reside
19%
1%
7%
9%
18%
46%
Millennials Prefer Single Family Homes
What type of residence do you plan to purchase?
0%
10%
20%
30%
40%
50%
60%
70%
Detached single-family home
Townhouse/condominium
Don't know/ unsure Other
67%
12%
20%
1%
Big Lots in the Suburbs are Highly Desirable
Which of the following features would you like to have in your ideal home?
3%
8%
12%
27%
34%
36%
41%
42%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Other
Don't know/ unsure
High rise building
Urban location
Live/ work space
View
Suburban location
Lots of land/ big lot
Ideal Neighborhood Features
Which of the following features would you like to have in your ideal neighborhood?
1%
8%
10%
11%
14%
17%
20%
21%
22%
28%
41%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Other
Resort area
Ethnic
Rural
Don't know/ unsure
Urban pioneer
Cul-de-sac
Urban core
Historic
Gated community
Pedestrian-oriented
MajorityWould Begin Home SearchOnline
How would you begin your search for a home to purchase?
0% 10% 20% 30% 40% 50% 60%
Other
Consult friends/family
Contact real estate agent
Online search
7%
15%
22%
56%
8/10 Feel Home Ownership is Important
How important is home ownership to you on a scale of one to 10, with one being not at all important and 10being extremely important?
0%
5%
10%
15%
20%
25%
30%
1 - Not atall
Important
2 3 4 5 6 7 8 9 10 - VeryImportant
2% 2%
5%3%
8%
12%
15%
26%
12%
16%
Advantages of Home Ownership
In your opinion, what are the advantages of home ownership?
24%
39%
43%
45%
46%
49%
56%
64%
0% 10% 20% 30% 40% 50% 60% 70%
Tax deductions
Equity/investment
Stability/security
More space
Better quality of life
Satisfaction of ownership
Privacy
Freedom to do what you want with the property
Advantages of Home Ownership
In your opinion, what are the advantages of home ownership?
45%
51%
34%
60%
0% 10% 20% 30% 40% 50% 60% 70%
Equity/investment
Privacy
18-26 27-34
Millennials Biggest Concerns
What are your biggest concerns about home ownership?
Price/Affordability (45%)
Problems with Credit, Mortgages, or Taxes (19%)
Maintenance/Upkeep (14%)
Satisfaction with Home/Location (7%)
Responsibility (4%)
HousingCrisisAffected HomeOwnershipPerspective
Has the recent (2007-2008) housing crisis made you less likely to consider owning a home a good investment?
Yes, 41%
No, 59%
Have Student Debt
What is the balance of your outstanding student debt?
0%
5%
10%
15%
20%
25%
$1-10K $10K-20K $20K-50K $50K-100K >$100K
21%
12% 12%
3%2%
Student Debt (In Thousands)
Student Debt Not Preventing Most from Buying
Is your student debt preventing you from qualifying for a mortgage?
Yes 12%
No 61%
Don't know27%
More than Half haveOther Debt that Prevents Buying aHome
What other type of debt do you have that would make it difficult to buy a home?
4%
7%
8%
17%
41%
43%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Other
Private loan from friend/ relative
Consolidated personal loan
Auto loan
Credit cards
None
Older Millennials Have more Debt
What other type of debt do you have that would make it difficult to buy a home?
9%
23%
50%
8%
13%
36%
0% 10% 20% 30% 40% 50% 60%
Consolidated personal loan
Auto loan
Credit cards
18-26
27-34
Most Uncertain/Doubtful theyCouldObtain aMortgage Now
Could you obtain a mortgage if you applied now?
Yes 22%
No 33%
Don't know45%
HOME OWNERS
Most Homes Purchased after 2009
What year was the home purchased?
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
3%1%
2%
0%2% 2% 2% 1%
6%
11%
8%10%
19%
15%
5%
Year
Majority Purchased their Homes
Who originally purchased the home?
9%
9%
79%
4%
36%
57%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
My spouse/significant other
My parent(s)
I purchased the home
18-26
27-34
Most Millennials are First-Time Buyers
Was this your first home purchase?
Yes, 88%
No, 12%
Median Purchase Price: $267,000
What was the purchase price of the home?
0%
2%
4%
6%
8%
10%
12%
9%10%
11% 11%
8%7%
9%
4%
6% 6%
3%
Purchase Price (In Thousands)
OlderCohort Purchased Pricier Homes
What was the purchase price of the home?
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
18-26 27-34 All
$210,500
$295,500
$267,000
Median Price
Purchase Price Highest in NorCal
What was the purchase price of the home?
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
Northern CA Southern CA Other CA All
$400,000
$267,000
$200,000
$267,000
Median Price
Affordability is Main Reason for Buying a Home
What were your main reasons for buying a home?
1%
1%
2%
5%
11%
17%
22%
23%
24%
29%
30%
37%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Other
To rent it out
To flip it for a profit
Desired smaller home
Investment/Tax advantages
Favorable financing
Changed jobs/Relocated
Tired of renting
Desired better/other location
Desired larger home
Change in family status
Affordable price
Many Didnt Buy Sooner Due to Lack of Urgency
Why didnt you buy a home sooner?
5%
7%
8%
26%
26%
27%
32%
33%
0% 5% 10% 15% 20% 25% 30% 35%
Other
Difficulty qualifying for mortgage
Needed to sell existing home first
Not many good housing options
Waited until finances improved
Needed to save for down payment
Waited to see when prices would stabilize
No buying urgency
Location! Location! Location!
What was the most important reason for selecting the home you purchased?
2%
4%
5%
6%
8%
18%
57%
0% 10% 20% 30% 40% 50% 60%
Other
School district
Size
Walkability
Home features
Neighborhood
Location
Majority Found HomeThroughAgent
How did you find the home you purchased?
4%
4%
6%
7%
26%
54%
0% 10% 20% 30% 40% 50% 60%
Other
Newspaper
Open House
For sale sign
Internet
Real estate agent
Most Found Home on Zillow or Realtor.com
If found home on internet, on which website did you find your home?
6%
2%
3%
5%
6%
6%
10%
23%
39%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Other
Broker
Zip Realty
Redfin
Trulia
Agent
Craigslist
Realtor.com
Zillow
Future Home Price Expectations are Positive
11% 15%
9%12%
21% 10%
59% 63%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
In one year In five years
Up
Flat
Don't know
Down
Do you think home prices in the neighborhood where you purchased will go up, down or stay flat in
PositiveAttitudeToward Home Buying Process
How would you describe your attitude towards the home buying process?
0%
10%
20%
30%
40%
50%
60%
Positive Negative Neutral N/A Other
50%
34%
8%4%
4%
Home Buying Experience vs. Expectations
How did the actual home buying experience compare to your expectations prior to beginning the process?
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Better thanexpected/Good
Worse than expected/Bad Same as expected
40%
25%20%
More than 4/5 are Satisfied with Home
Are you satisfied with the home you purchased or do you feel like you selected the best option given the limitedsupply of homes?
Satisfied, 85%
Selected bestoption given
limited supply,15%
Older Millennials Plan to Keep Home 1Year Longer
How long do you plan to keep the property?
0.0
1.0
2.0
3.0
4.0
5.0
18-26 27-34 All
3.8
4.74.3#
of
Years
Millennial Age Group
Average
MostWant BetterAgent Communication
If there were one thing you could change about your home buying experience, what would it be?
9%
16%
31%
53%
64%
69%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Other
Better agent negotiation
Faster agent response
Nothing, I would not change anything
Better market understanding
Better communication with agent
Advice to First-Time Buyers
What advice would you give to other first time buyers?
3%
13%
16%
22%
24%
28%
33%
54%
0% 10% 20% 30% 40% 50% 60%
Other
Find out how frequently your agent will be in contact
Don't use the sellers' agent
Get pre-qualified for a mortgage by more than 1 lender
Check agents' references
Make your agent prove he/she will negotiate hard for you
Find out how fast your agent will respond to you
Do your homework online
MostWouldnt Sell Home Now
Would you consider selling your home now?
Yes, 27%
No, 57%
Don't know,16%
Financing
MajorityObtained Financing
How did you pay for the home you purchased?
Obtainedfinancing, 83%
All cash, 17%
Cash Funds Mainly from Personal Savings
If all cash, where did the funds come from? N = 41
2%
2%
5%
12%
17%
22%
27%
51%
0% 10% 20% 30% 40% 50% 60%
Supplied by employer contribution
Supplied from governent
Other
Sales from personal assets
Borrowed or gifted
Inheritance
Proeeds from a previous residence
Personal savings
Average Down Payment: 26%
0%
2%
4%
6%
8%
10%
12%
14%
16%
0 1 to 5 6 to 10 11 to 15 16 to 20 21 to 25 26 to 30 31 to 35 36 to 50 50+
5%
8%
13%
8%
15%14%
9%8%
11%
12%
Down Payment (%)
How much was your down payment for the home purchased (as a percentage of the sale price)?
Average Difficulty Rating: 4.4
Please rate how easy or difficult it was to obtain financing on a scale of one to 10, with one being very easy and10 being very difficult.
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
1 -VeryEasy
2 3 4 5 6 7 8 9 10 - VeryDifficult
9%10%
19%
13%
17%
15%
8% 8%
1% 1%
Buyer/ Agent Relationship
Many Related to Agent
How did you find your real estate agent?
2%
3%
3%
6%
6%
8%
10%
12%
19%
31%
0% 5% 10% 15% 20% 25% 30% 35%
Prior dealings with the company in other areas
Other
Prior dealings with real estate agent
"For Sale" signs in the neighborhood
Met at an event
Agent's farming material
Did not use an agent
Internet
Referral from friends, relatives, neighbors, or othercontacts
Agent is a relative or friend
Average Number of Agents Interviewed: 2
How many agents did you interview prior to selecting the agent you used in your recent home purchase?
0%
10%
20%
30%
40%
50%
60%
1 2 3 4 5 6+
58%
22%
12%
4%2% 3%
Agents Interviewed
ResponsiveAgents are Most Desired
What was the single most important reason for selecting that agent?
3%
4%
8%
9%
17%
27%
31%
0% 5% 10% 15% 20% 25% 30% 35%
Distressed property knowledge
Seemed most aggressive
Negotiating ability
Other
Previously used agent
Most knowledgeable
Seemed most reponsive
4/10 GoogledTheirAgent
Did you Google (conduct an internet search for) your agent to find out information about him/her?
Yes, 40%
No, 52%
Don't know,8%
Average Number of HomesViewed: 8.2
How many different homes did you preview and visit with your agent prior to making a purchase?
0%
5%
10%
15%
20%
25%
1 2 3 4 5 6-10 11-20 21+
10% 11%
19%
7%
12%
21%
13%
7%
Homes Viewed
Average Number ofOffers onOther Homes: 2.3
How many offers did you make on other homes?
0%
5%
10%
15%
20%
25%
30%
0 1 2 3 4 5 6 to 10 11+
20%
28%25%
12%
3%
6%4%
3%
Number of Offers
Preferred vs.Actual Communication
0%5%
10%15%20%25%30%35%40%
Preferred Actual
What was your preferred method of communicating with your agent and how did your agent primarilycommunicate with you?
Preferred vs.Actual Response Rate
2%
28%
48%
22%
3%
29%
48%
20%
0%
10%
20%
30%
40%
50%
60%
>1 business day Within 1 business day Within 1 hour Instantly
Preferred Actual
When attempting to reach your agent, what response time were you typically expecting for your agent to getback to you, and on average, what was the actual response time for your agent to return your communication?
Overall Home Buying ProcessAverageSatisfactionRating: 7.3
Please rate your degree of satisfaction with the overall process of buying a home on a scale of one to 10, whereone is least satisfied and 10 is most satisfied.
0%
5%
10%
15%
20%
25%
30%
35%
1 - LeastSatisfied
2 3 4 5 6 7 8 9 10 - MostSatisfied
1% 1%4%
2%6%
11%
21%
33%
11% 11%
AverageAgent Satisfaction Rating: 7.5
Please rate your degree of satisfaction with your real estate agent on a scale of one to 10, where one is leastsatisfied and 10 is most satisfied.
0%
5%
10%
15%
20%
25%
30%
1 - LeastSatisfied
2 3 4 5 6 7 8 9 10 - MostSatisfied
2%1%
4%2%
6%9%
17%
28%
14%17%
WhyWere Millennials Satisfied with theirAgent?
Why do you have that level of satisfaction with your agent?
2%
4%
7%
16%
18%
38%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Other
Agent was always quick to respond
Agent listened to my needs
Agent helped find the best home
Agent negotiated good deal
Agent worked hard
WhatCouldAgents Improve?
Why do you have that level of satisfaction with your agent?
3%
3%
4%
5%
0% 1% 2% 3% 4% 5% 6%
Agent did not communicate according to my preference
Agent was not aggressive in negotiation
Agent needed to do a better job of monitoring thetransaction
Agent did not communicate efficiently
Value of Hiring anAgent
What value did you receive from hiring an agent to represent you in the transaction?
0%
5%
10%
15%
20%
25%25%
19%
10% 10%
8% 8%6%
4% 4%
4/5WouldWork with SameAgentAgain
Would you work with the same agent again?
Yes, 78%
No, 12%
Don't know,11%
Where do Millennials NeedAgentAssistance?
In which part(s) of the transaction did you need the most assistance from your agent?
2%
6%
6%
16%
27%
43%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Other
Determining comps
Determining affordability
Negotiating terms of sale
Negotiating purchase price
Finding the right home
Advice for Real EstateAgents
What advice would you give to real estate agents to improve the home buying process or their level of service?
5%
16%
17%
26%
35%
40%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Other
Communicate better
Understand the real estate market better
Negotiate better
Respond faster
Communicate according to clientpreference
Baby Boomers in the HousingMarketWhats Ahead in their
GoldenYears?Thursday, October 30, 2014
2:00 PM - 3:00 PM
To register:WWW.CAR.ORG/MARKETDATA/VIDEOS
Join us for our next webinar