Housing Market Bust is Changing Buyer Behavior

Twenty-seven percent of first-time buyers who purchased a home between July 2009 and June 2010 received a gift from family or friends to help with the down payment, according to the National Association of Realtors’ annual Profile of Home Buyers and Sellers survey, released at NAR’s annual conference recently in New Orleans.

9% of first-time buyers received a loan from a relative or friend in the most recent data, compared with 6% who said the same in the results released last year, according to NAR. The survey included responses from 8,449 home buyers.

First-time home buyers made up a record 50% of all buyers during the period, up from 47% in last year’s figures, according to the report.

Certainly, many potential buyers aren’t buying in today’s market because they’re worried about the economy; for instance, they may be concerned about the security of the job they currently have. And for those who have the desire to buy, the road to obtaining financing can be a rough one — and sometimes a deal killer — if their credit scores aren’t up to par or they don’t have enough cash to put down, for example.

Today’s homeowners intend to live in their home for a long time, according to the NAR data. First-time buyers plan to stay in their homes for an average 10 years when they make a purchase; repeat buyers plan to stay for 15 years. There was a time when the average time to stay in a home was around 7 to 8 years.

Buying a home and staying put for a number of years often makes good financial sense for a homeowner — even if that person owns a home during a dramatic housing bust, like the one from which the country is still reeling, the NAR report pointed out at the conference.