PA homebuyers over 50 more likely to pay cash

More than 40 percent of homebuyers over the age of 50 paid cash for their home purchase in Pennsylvania over the past year, according to the latest Welcome Home survey. The greatest increase was seen in respondents between 50 and 64 years old, which rose from 18 to 33 percent from the last quarterly survey.

Earlier this year, Keystone Analytics® began conducting quarterly telephone interviews with consumers who purchased a home in the last 12 months. The results of the Welcome Home survey are provided to PAR members to help them better understand the home buying market.

The survey shows that younger homebuyers are less likely to pay for a home with cash. I know I’ve seen an increase in cash buyers in my market as I’m sure many of you have. Many older buyers who have more assets are using them toward a home purchase.

The Welcome Home survey showed that relocating and tiring-of-renting remained the top two reasons respondents cited for buying a home. Nineteen percent said the desire or need to relocate was their main reason to move, while 14 percent were tired of renting and were ready for their own home. Roughly equal proportions of those surveyed said downsizing (12 percent) and needing a larger home because their family has grown (11 percent) were also reasons for moving.

In many markets, we’re seeing rising rental prices. We know it makes sense for people to consider homeownership over renting because owning a home is one of the best ways to build financial security over the long term, providing both equity accumulation and tax benefits over time.

While financing questions remain the most stressful parts of the home buying process, many respondents found the pre-closing waiting times, and post-closing moving process were the most stressful. By “waiting,” respondents were referring to the time in the closing process where documents are processed, exchanged and reviewed by the buyer and seller, and not always with a firm timeline for making decisions. Other respondents found that moving into their new home was the most stressful part of the experience, rather than the whole or any part of the transaction.

As Realtors®, part of our job to help ease the stress during the real estate transaction. Home inspections, closing issues, the sales process and local ordinances/taxes are all listed as stressful in the transaction. We can help consumers negotiate this process and keep everything moving smoothly.

The Welcome Home survey makes it clear that the homebuyers of the future do use and value online home search tools like Realtor.com. More than 75 percent of buyers under the age of 50 use online sites to search for a home, compared to more than 50 percent of buyers over the age of 50 who don’t use online services.

Are you seeing some of these trends in your market? How can you adjust the way you do business to reflect the changing needs of today’s consumers? I think these survey results will continue to reveal areas where we may want to adjust how we interact with homebuyers and sellers.