With the rise in vaccinations and falling COVID-19 transmission rates, the U.S. has reopened its economy and many companies are announcing their strategies to a return to office. Real estate is seeing the return of traditional open houses, home showings and broker tours. The Covid pandemic, however, has influenced the home search of many buyers. Confined for most of 15 months in their homes, some buyers' preferences for a home have changed.
A Realtor.com online survey of 1,200 home shoppers conducted in the spring by HarrisX found the need for more space is the top reason driving many homebuyers' decision to purchase a new home in the coming year. While majority of buyers are looking for three bedrooms and two baths, they now rank more flexibility in their home space and affordability above a shorter commute.
When asked which home features are now a priority as a result of the pandemic, quiet location (28%), updated kitchen (25%), garage and large backyard (24% each) topped the list. Outdoor living area (20%), space for pets (18%), updated bathrooms (19%), home office and broadband internet capabilities (17% each) and open floor plan (16%) rounded out the top 10 pandemic-induced most desired home features.
Sixty-five percent of respondents indicated they are considering extended family when they shop for a home, with nearly a quarter stating they are planning to buy near family members. One-fifth of those surveyed said they would have extended family living with them full-time, and 30 percent said their new home would need to accommodate extended family staying with them part-time or visiting.
Consistent with the desire for outdoor space, terms such as "fenced yard," "acres," "backyard," "front porch," "garage" and "three-car garage" and "pet friendly" have all seen a significant uptick in searches on Realtor.com's website over the past year. Decreasing in importance from prior surveys was the need for a short commute time (9%) and a home with smaller square footage (4%).
When buyers were asked to select features they would sacrifice if they had to reduce their budget, several COVID-coveted features would be the first to go, with man cave and pool/spa tied at 24 percent, followed by guest house and mother-in-law suite (both 23%), new construction (22%), solar panels (21%), finished basement (20%), home office (18%), large backyard and guest room (both 17%).
Buyers are very much aware of the competitive market. Thirty-five percent of respondents said they were checking listing websites every day and 25 percent had set a price alert to get notified when new homes hit the market to stay ahead of the competition.
Twenty-eight percent indicated they were planning to offer more than a 20 percent cash payment, 21 percent plan to increase their earnest money deposit, and 17 percent plan to either offer above asking price or all cash. A third said they would not offer above asking price and nearly half were prepared to offer up to 10 percent above asking.
"While the Covid pandemic has brought about changes in home search preferences, the housing shortage and skyrocketing prices here in Silicon Valley is another reason that has forced some employees to move farther away to more affordable places. Working remotely worked for them during the pandemic and now, many are opting to work from home or come into work but not every day," said Joanne Fraser, president of the Silicon Valley Association of Realtors. "While this has alleviated commuting and in some places it has eased the traffic situation, it is forcing businesses to evolve. For some companies it means making tough decisions regarding their office model in this new post-pandemic environment."
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.