California's strong economy and job market are drawing buyers back to the housing market and forming more households. Buyers who previously lived with their parents and those who experienced a foreclosure or short sale a few years ago are buying homes again, according to a newly released state REALTOR® survey.
The California Association of REALTORS®' "2015 Survey of California Home Buyers" found in 2015, more households were formed as the share of buyers who previously lived with their parents increased to 12 percent – the highest in the survey's history, up from 2 percent in 2014. The share of those who previously rented dipped from 40 percent in 2014 to 39 percent in 2015, and those who previously owned fell from 59 percent in 2014 to 47 percent in 2015.
Additionally, homeowners who previously went through a foreclosure or short sale are purchasing homes again. More than one in five home buyers (22 percent) experienced a distressed sale, most of which occurred after 2007. The share of buyers who were previously "underwater" on their homes increased to 23 percent in 2015, up from 4 percent in 2014.
"That we are seeing young adults who were forced to move back home with their parents andhomeowners who previously went through a foreclosure or short sale purchasing homes again is a good sign that the market has recovered from the meltdown of a few years ago, " said Chris Isaacson, president of the Silicon Valley Association of REALTORS®. "It also shows people continue to value homeownership."
The survey likewise indicates today's buyers are looking at homeownership more for the long-term. Buyers in 2015 indicated they plan to keep their home an average of 20 years, compared to six years cited by home buyers in 2013. Their top reasons for purchasing a home included: "tired of renting" (15 percent), "wanted a place to live" (14 percent), "desired larger home" (12 percent), "changed jobs/relocated" (11 percent), and "desired better/other location" (8 percent).
Buyers put an average of 24 percent down on their home purchase in 2015, down from 28 percent in 2014, and 25 percent in 2013, but more than what has been the traditional 20 percent since 2009.
"As our market returns to normalcy, it is important buyers and sellers work with a trusted and knowledgeable REALTOR® who can guide them through the transaction process and share all relevant information, so they can make an informed decision," said Isaacson. "Remember that not all real estate agents are REALTORS®. The term 'REALTOR®' is a trademark that can only be used by members of the National Association of REALTORS®. REALTORS® adhere to a code of ethics, which holds them to a higher standard of conduct than other real estate licensees."
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.