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We’d like to highlight a few defining characteristics of the 2015 Mid-Atlantic real estate market. We’ll be reviewing information coming from Realtor.org and referencing some of their helpful infographics. Check out this national infographic:
One of the most distinctive features of the Mid-Atlantic real estate market is why people are selling their homes. Nationally, Realtor.org cites that in 2015, “The most common reason for selling a home was that it was too small.” So, these are homeowners who need more living space for whatever reason. Yet, in the Mid-Atlantic the number one reason for selling a home was to find a “smaller home.” There is a downsizing trend in the Mid-Atlantic region. In the Philadelphia market, we’ve seen this trend for some time. There are baby boomers downsizing and moving into the city. Various motivations trigger these moves: a desire to live in a more walk-able setting, children moving out, et cetera. These homeowners have the equity to move into city homes with adequate space. With a median age of 57, it’s clear that the baby boomer generation is fueling this trend.
Mid-Atlantic buyers are motivated for the same reasons as others around the country: the desire to own. 35% of respondents cited the desire to own a home as the reason to purchase a home. In fact, the number one reason to purchase a home was the desire to own in all regions surveyed. There was one interesting figure regarding first-time buyers. 43% of Mid-Atlantic buyers were first-time buyers versus 32% nationally. Though the data includes New York City, this trend may be fueled by comparatively affordable homes in Philadelphia.
Millennials are the newest generation to enter the real estate market. With an average purchasing age of 29, many are curious as to how this tech-savvy generation will affect the market. Realtor.org points out that,
So even though Millennials are using the internet (think Zillow, Trulia and Realtor.com) to find their home, when it comes to purchasing they are relying, more than ever, on agents to navigate them through the process.
There is a conception that Mid-Atlantic Millennials will want to move into more urban areas, though an article from George Mason University cites that, “It is possible that we may be over-estimating Millennial urbanity. When the Demand Institute asked Millennials where they would prefer to live next, 48% said suburbs and 38% said urban locations.” So perhaps this assumption that all millennials will be picking up and moving to the city is not completely true.
What is significant about millennial trends is that while tech savvy, they are not necessarily predictable. With employment fluidity, economic strains and other lifestyle factors, it is no surprise that many Millennials are still renting.