first-time homebuyer

According to Zillow, 40 percent of first-time homebuyers are married now, compared to 52 percent two decades ago.

Who needs a spouse to buy a first house? Not too many folks anymore.

According to new research from Zillow, only 40 percent of first-time homebuyers are married today, down from 52 percent in the late ’80s.

Why is this? First, fewer people are getting married in general. Barely half of adults (51 percent) were married in 2011, according to the Census Bureau’s American Community Survey data, compared with 72 percent in 1960. Marriage increasingly is being replaced by cohabitation, single-person households, and other living arrangements (mom and dad’s house!).

They’re also waiting longer to get married—the median age for first marriage is now 27 for women and 29 for men, up from 20 for women and 23 for men back in 1960, according to new Pew Research Center analysis of census data.

This real estate trend is showing up in the Dallas-Fort Worth market. One example: ReMax Realtor Ken Lampton says he has a lot of unmarried professional women buying in the Lakewood and Lower Greenville areas of Dallas.

“They don’t have children, so schools aren’t a concern, and they are willing to buy a smaller house in order to be closer to downtown Dallas,” Lampton said.

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Rosemary Beach You know why? Because the Gulf Coast is hopping with real estate sales. This is one of my absolute favorite vacation home beach communities that is always loaded with Texans. Plus Santa Rosa Beach realtor extraordinaire Karen Wagner tells us they are going to have a whole lot MORE Texans once Southwest Air Lines starts flying direct to Panama City Beach this fall.

89 Watercolor BoulevardOh, I can hardly wait. Details and more glorious beach front House Candy over on SecondShelters.com.

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Rosemary Beach You know why? Because the Gulf Coast is hopping with real estate sales. This is one of my absolute favorite vacation home beach communities that is always loaded with Texans. Plus Santa Rosa Beach realtor extraordinaire Karen Wagner tells us they are going to have a whole lot MORE Texans once Southwest Air Lines starts flying direct to Panama City Beach this fall.

89 Watercolor BoulevardOh, I can hardly wait. Details and more glorious beach front House Candy over on SecondShelters.com.

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David Griffin for sale

(Photo: David Woo/The Dallas Morning News)

Rarely do you see both home prices and rents grow in the same market where, as we reported earlier this week, net migration is in the red. And yet that’s what Local Market Monitor is projecting for Dallas-Irving-Plano area over the next 12 months.

That’s partially due to unemployment rates dropping and a strong financial and service job market in the Dallas area. Local Market Monitor projections show 9 percent growth in housing prices over the next 12 months and 12 percent growth over the next three years. And demand for housing, both buying and renting, will grow thanks to overall population growth that is outpacing the national average.

For these reasons, Local Market Monitor is categorizing the Dallas-Plano-Irving area as “Low Risk” for investors, which is good news for international real estate investors, a growing market in DFW.

Boots on the ground reports from Realtors still show sales as somewhat brisk, but according to RedFin reports, the fall season is showing its traditional slowdown from a hot sellers market to a better buyers market.

“At the end of this summer, you could smell the rubber on the road from buyers hitting the breaks,” said Redfin San Diego agent Sara Fischer. “The cutthroat competition and frenzied demand has relaxed considerably.”

So with prices reaching equilibrium and short inventory, those homebuyers who were waiting for the right time to find their dream home will be happy to hear that today’s the day.

  • 543,000 vacation homes were sold in 2010, ten less than in 2009.
  • 867,000 investment homes were sold in 2010
  • 940,000 investment homes were sold in 2009
  • Only 25 percent of vacation home buyers plan to rent them.
  • Only 20 percent of investment buyers plan to use their second homes themselves.
  • The median price of a vacation homes hovers between $150,000 and $170,000 and is falling.
  • The median price of an investment property is usually around $105,000.
  • Vacation homes accounted for 10% of all real estate sales last year.
  • Investment homes accounted for 17% of all real estate sales last year.
  • Baby Boomers closing out their “peak financial years” are shopping for second homes and swooping up the bargains, but the second home market is still tepid. The benefits: a long-term investment and hedge against inflation if they are buying at the bottom, and income potential through rental. If Boomers are looking toward retirement or a scaling back of work, many see a future retirement home in the second home. That is, they want to lock down a place now while prices are low in anticipation of selling the larger family home eventually.

    Why is this so different from the way Boomer’s parents operated? Most Boomers bought their home, paid it off, and stayed in it until they moved (or were moved) to a retirement home. My uncle lived in his home until he died at the age of 100. But dynamics that made this scenario attractive have changed. Property taxes, for one, are rising in urban areas, as is crime and traffic. Federal tax laws have changed and may change again, making home ownership more (or less) attractive. As income dips, real estate investment can provide additional tax benefits or shelter. Children are spread across the globe and may not be able to take care of an elderly parent in the family home. Boomers lived in homes that average less than 2,000 square feet. Their children (baby boomers) bought and built bigger homes that eventually become costly or cumbersome to maintain.

    Demographically, the typical vacation-home buyer is about 46 years old, has a median household income of $87,500, and purchases a property that is a median distance of 348 miles from their primary residence, according to the National Association of Realtors. (About 34 percent were within 100 miles of their primary residence, and 40 percent were more than 500 miles away.)

    Annually, between 10-27 percent of all homes sold in the United States are in the vacation homes, second home or investment home category. And those numbers will increase because vacation homes are a bargain right now. The median price of a vacation or second home was $150,000 in 2010, down a whopping 11.2% from a year earlier, according to the NAR. Nationally, values at primary residences fell 4.5% in  2010. Nearly 40% of vacation home sales were cash sales, and if a buyer did obtain financing, they put a bunch down, 30 to 40% down. Finally, most vacation home buyers wanted the great deals and found them: nearly 17% of the investment homes they bought were foreclosures.

    Those percentages were little changed for 2010 as home sales declined across the board. There were 543,000 vacation homes sold, down from 553,000 in 2009; investment purchases fell to 867,000 from 940,000.

    One factor depressing sales was the difficulty in getting mortgages due to tight credit markets. Buyers often did an end-around this problem by paying cash. Nearly 40% of vacation home sales were cash deals, while nearly 60% of investment deals were handled that way.

    I wrote a piece for AOL this week that was very telling: cash real estate transactions are up, as originally reported by the Wall Street Journal: in fact, cash buyers may be juicing up the market, especially in the underwater areas. The WSJ wonders if this could be a good gauge that the market has bottomed. When looking deeper, I found that cash real estate transactions were as high as 51% of all the real estate transactions in troubled Las Vegas, where it is cheaper to buy a home than rent IF you can get financing.¬† Cash buyers represented more than half — 50 percent — of all transactions in the troubled Miami-Fort Lauderdale area last year, this according to Zillow.com. Looking back at 2006, cash was king on only 13 percent of deals. That cash was enough infusion to make Miami home prices actually rise 15 percent in 2010 from a year earlier, according to the Miami Downtown Development Authority. And in drowning Phoenix, the percentage of buyers in Phoenix paying cash hit 42 percent in 2010 — which was more than triple the rate in 2008.

    Nationally, the National Association of Realtors says only 28 percent of real estate sales were all-cash deals last year. Compare that to a rate of 14 percent in October 2008, which is when the NAR first started tracking the measure.

    So I want to track the cash sales rate in Dallas. If you have made any cash sales or purchases, please pipe in right here and comment. What I’m hearing is that there are a lot floating around, and deals are coming in at 10 to 20% the asking prices. On a $2,200,000 home, a cash buyer plunked down a cool two million and the seller said, deal. This in Park Cities.