Tag Archives: nahb

Latest Study Shows Average Buyer Expected to Stay in a Home 13 Years

Latest Study Shows Average Buyer Expected to Stay in a Home 13 Years

from Eye on Housing by Paul Emrath

recent article  published by NAHB shows that, based on a long-run calculation that averages mobility tendencies over a number of years, the typical buyer of a single-family home can be expected to stay in the home approximately 13 years before moving out.

This work updates a previous article that used data from the American Housing Survey (funded by the Department of Housing and Urban Development and conducted in odd-numbered years by the Census Bureau) through 2007.   The new study incorporates AHS data through 2011.

The mobility tendencies observed in the 2011 data imply that the expected length of stay in an owner-occupied, single-family home would be about 16 years (the time it would take half of single-family buyers to move out).  However, 2011 is likely to be an atypical year, so the article repeats the analysis using mobility tendencies observable in earlier years, with results as shown in the figure below.

Length chart for blog

If a single estimate is needed for how long buyers who move in today or in the near future can be expected to remain in their homes, the article recommends 13 years, based on the rounded average across all data points shown in the figure.

The article also shows that, over the 1987-2011 period, the expected length of stay in a single-family home has been consistently longer for trade-up buyers than for first-time buyers.   Averaged over those years, the expected length of stay in a single-family home is about 11 and a half years for first-time buyers, compared to 15 years for buyers who have owned a home before.

For more details, see the full article “Latest Calculations Show Average Buyer Expected to Stay in a Home 13 Years” published as the January 2013 Special Study in NAHB’s HousingEconomics.com.

Leave a comment

Filed under Housing

Read of the Day: NAHB: Builder Confidence in the 55+ Housing Market Increases in Q3

NAHB: Builder Confidence in the 55+ Housing Market Increases in Q3

by Bill McBride on 11/08/2012 

This is a quarterly index from the the National Association of Home Builders (NAHB) and is similar to the overall housing market index (HMI). The NAHB started this index in Q4 2008, so all readings are very low.

From the NAHB: Builder Confidence in the 55+ Housing Market Continues to Improve in the Third Quarter

Builder confidence in the 55+ housing market for single-family homes showed significant improvement in the third quarter of 2012 compared to the same period a year ago, according to the National Association of Home Builders’ (NAHB) latest 55+ Housing Market Index (HMI) released today. The index more than tripled year over year from a level of 12 to 36, which is the highest third-quarter reading since the inception of the index in 2008.

The 55+ multifamily condo HMI had a significant increase of 13 points to 23, which is the highest third-quarter reading since the inception of the index in 2008; however, condos remain the weakest segment of the 55+ housing market. All 55+ multifamily HMI components increased considerably compared to a year ago as present sales rose 13 points to 22, expected sales for the next six months jumped 19 points to 29 and traffic of prospective buyers climbed 11 points to 22.

“Like other segments of the housing industry, the market for 55+ housing is continuing on a steady upward path, driven by improving conditions in additional markets around some parts of the country” said NAHB Chief Economist David Crowe “While we expect the upward trend to continue as the recovery broadens, the speed of the recovery is being constrained by factors as tight mortgage credit, making it difficult for potential 55+ customers to sell their current homes, and shortages of inputs to construction such as buildable lots that are beginning to emerge in some market areas.”

HMI and Starts CorrelationClick on graph for larger image.

This graph shows the NAHB 55+ HMI through Q3 2012. All of the readings are very low for this index, but there has been a fairly sharp increase over the last year.

This is going to be a key demographic for household formation over the next couple of decades – if the baby boomers can sell their current homes!

There are two key drivers: 1) there is a large cohort moving into the 55+ group, and 2) the homeownership rate typically increases for people in the 55 to 70 year old age group.

HMI and Starts CorrelationThe second graph shows the homeownership rate by age for 1990, 2000, and 2010. This shows that the homeownership rate usually increases until 70 years old or so.

So demographics should be favorable for the 55+ market – if these people can sell their current homes.

Read more at http://www.calculatedriskblog.com/2012/11/nahb-builder-confidence-in-55-housing.html#oe9OfwdTSxyO85R8.99

Leave a comment

Filed under Housing