Thought Last Year Was Tough for Home Buyers? Just You Wait

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Call it trouble in paradise: Last year was a serious bummer for many would-be home buyers, who had made the big decision that they were ready to buy, only to be frustrated by the lack of available homes and heavy competition from other buyers in the booming real estate market.

But this year may be even more challenging. Now, leftover buyers from the previous year are joining the usual crop of wannabe homeowners who come out in the spring and summer. It’s shaping up as an epic traffic jam on the road to home ownership.

I’ve been saying that key indicators on realtor.com® this year point to the busiest spring buying season in a decade, and we’re starting to see sales data that backs that up. The National Association of Realtors® reported on Wednesday that existing home sales in March increased 5% from February and that homes were selling substantially faster.

But instead of looking backward, let’s assess what the demand for homes looks like in April. Our traffic survey data for the first half of the month sheds a bit more light on how this spring is shaping up — and how it compares to last year.

Visitors to our site who are primarily focused on buying now account for 74% of our traffic, which is 3% more than last April. With record traffic and a higher share of buyers, that means we have a record number of potential buyers looking at homes.

The buyer traffic share has increased at the expense of potential renters. Site visitors looking for a rental declined to 15%, from 18% last year.

And here’s some good news: That buyer pool represents a huge and diverse range of people, from those with serious, short-term intent to those who face challenges and are just now starting to explore. Over half of the buyers in the pool today (51%) intend to purchase within the next six months.

The biggest impediments to buying are the same as last year. And yes, the percentages of buyers that report each of these issues as prime obstacles are essentially unchanged.

Supply and time remain the biggest challenges:

1. 41% of buyers report that they have yet to find a home that meets their needs

2. 30% of buyers report that they cannot find a home within their budget

3. 30% of buyers indicate that they are just starting and need time to get ready.

We assess the seriousness of buyers by looking at how they rate their likelihood to buy and what their time frame is. Serious buyers make up 45% of today’s buyer pool. And we’re seeing a substantial increase in the share of millennials.

Young adults ages 18 to 34 make up 34% of the serious buyers today. That’s up from 26% last April.

Sounds like #FOMO. Millennials are the reason that we have a record number of potential buyers, at the expense of potential renters. And they are taking advantage of the most complete and up-to-date view of inventory via the realtor.com mobile app. That’s a competitive advantage when the No. 1 issue is finding a home!

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