Like many other sectors, the pandemic hit the real estate industry hard. Commercial real estate, especially offices, and retail spaces, bore the brunt of it. On the residential side, demand shifted as homebuyers moved away from pandemic-stricken cities towards the suburbs.
In response to these moves, existing home sales in the US skyrocketed by a record 24.7%. China and the UK also saw healthy growth. Sellers hoping for bidding wars with overseas buyers took a hit. However, local buyers enjoyed lower prices with less competition.
Since social distance isn’t possible in real estate, the industry embraced technology. Real estate management software became essential overnight. Will these tools help companies adapt and survive? Just like most businesses, critical factors have a major influence on real estate, and we are here to take a closer look at what they may be and how relevant they are in today’s world. Let’s dig into the statistics and trends to find out!
Statistics on Real Estate (A View on Property Owners and Sales)
1. By September 2022, Home Ownership in America Rose 66%.
This is because many people could afford homes. After all, they had a steady source of income and weren’t scared of increases in apartment rents or prices. This increase was experienced within the second quarter, rising from 65.8% to 66%.
2. The Midwest Recorded the Highest Home Ownership Rate By 70.1%. This is Followed By the South(67.5%), the Northeast(63%) and the West(62%).
From July to September, many real estate agents migrated to the Midwest, particularly in South Dakota, Iowa, and Michigan, for career reasons. This was spurred by the spike in house ownership to 70.1%. High ownership rates in a particular geographical location increase the prospect of new ownership, which is why real estate agents regard such places as “gold mines.”
3. About 26% of the House Owners Are First-Timers.
As of 2021, the percentage of first-time owners was 34% but declined in 2022 by 26%. According to a report by the National Association of Realtors, this is by far the lowest since the inception of data collection in the area of real estate in 2021. It becomes more interesting when we look at the age demography of first-time house owners. In 2021, first-time house owners’ default or average age was 33 years. A year later, that figure increased to 36 years, but in contrast, the average age of previous or recurrent owners is 59 years. Among first-time owners, about 18% of them are unmarried folks. This report shows that younger people rarely have the financial muscle to buy properties, hence why they are a minority in the market share.
4. The Mortgage Rate Declined to 5.28% and 6.15% For Both 15-year FRM and 30-year FRM, Respectively, As of January 2023.
Thanks to the inflation rate in today’s world from the aftermath of COVID-19, mortgage rates have experienced a gradual drop till today, with the lowest rate recorded in September 2022. Consequently, it has given a boost to demand in the market for both prospective buyers and homeowners. As of this year, the mortgage rates took a plop from 6.38% to 5.28% for 15-year FIXED RATE MORTGAGES. For 30-year FRM, a drop from 7.08% as of November 2022 to 6.15% by January 2023, according to reports from both Invest and Freddie Mac.
5. An Online Search is Conducted by 47% of Prospective Homebuyers Before Reaching Out to An Agent.
A lot of trust is placed in real estate agents as possible homebuyers consult agents before making purchases. Recent research shows that almost 50% of homebuyers check online for landed properties before consulting an agent. A minority of 18% go to their agents before taking further action. Despite the recent trend of checking online for property purchases, 86% of homebuyers still consult their agents for information not found online. Examples of such information are legal issues related to buying property. It poses no threat to real estate agents’ careers as they are still relevant in the market.
6. 21% of Homeowners Sold Their Homes for Closer Proximity to Family Members and Friends.
A growing trend was that 21% of property owners sold their landed property just to be close to family and friends. Some of these owners were aged 60 and above and were retiring, hence the urge to be closer to their roots. About 11% fell into this category. Another 11% sold and relocated because they were bored with their current location, having lived and worked in the area for most of their lives.
7. The Sale of Landed Property Declined by 1.5% by December 2022.
This was caused by the high inflation and mortgage rates that continue to wreak havoc on the economy of the US—the year marked the longest period of decline for home sales ever recorded.
8. 10% of Home Sale Transactions Were Done Through FSBO.
FSBO means For Sale By Owner, and the house owner did transactions in this category. About 50% of house owners knew the potential buyer. In rural locations, 13% of landed property is sold through FSBO; in the suburbs, it is about 6%. The average price for sales done through this method is lower than the actual selling price. With the help of an agent, the average sale for homes was $345,000, while those conducted through the owner were an average of $225,000. Agents are still relevant today.
9. The Number of Homes Sold by December 2022 was 376,319.
This is a poor return from the number of homes sold by December last year. The real estate market for houses isn’t that good. This calls for estate agents to be wise and find other ways to convince people to buy property.
10. The Most Competitive City in America for Real Estate is Fayetteville in North Carolina.
The average price for homes in Fayetteville is $195,000 as of December 2022. Properties are usually in high demand in this area with constant bidding wars. Unlike the previous year, houses are generally sold within 11 days, with an average of 53 days. Most shocking is despite fewer market days in 2022, the return on sales was quite disappointing, with only 285 landed properties sold in December compared to a whopping 415 sold in 2021 within the same month, much lower by 31.3%.
11. Properties Were Sold on An Average of 37 Days Across the US as of December 2022.
Before December, properties were sold at an average of 24 days before it escalated by December. Due to the poor economic situation, prospective home buyers didn’t have enough capital to acquire landed properties. They mostly stayed away from purchases. Let us not forget the impact of inflation that was still ongoing within this period, including high mortgage rates.
12. The Fastest Growing Sales Price was Observed in Birmingham by 24%.
On average, the selling price for this geo-location is $214,500 in the year 2022 by December.
The number of social media users in the world is 4.9 billion, which constitutes about 60.49% of the world population use social media, with Facebook being the largest social media platform in the world. Real estate agents have seen the need to use social media to reach potential clients and expand their business. Let us go through the statistics on social media for agents.
13. The most popular real estate website in America is Zillow.
14. 24% use YouTube,72% are on Facebook,55% use LinkedIn, and 45% are on Instagram.
15. The percentage of realtors that close at least a deal from the direct influence of social media is 30%.
16. On average, every month in the US, 11 ads on real estate are looked at by Facebook subscribers.
17. Smartphones constitute 96% of visits to Facebook by realtors.
18. 94% of estate agents link up with potential clients through text messages.
Real Estate Technology Statistics
Based on the complexity of the real estate business, with several factors that have a huge influence on the market, the software has been produced to aid real estate agents in maneuvering certain obstacles in the business. They are useful in helping the realtor get to their target audience and make their services known to them.
As previously mentioned, many people use smartphones for social media or communication. Consequently, a lot of agents use their smartphones to have access to some of these technologies. Let’s take a look at the stats in this category.
Using drones to capture videos and pictures in the real estate business has become very popular, with about 80% of agents using this technology to capture what will be used to create awareness for prospective clients.
19. A fifth of commercial drone imagery or video is used for real estate purposes. Seeing is believing. 73% of property owners confessed they are likelier to contact a real estate agent who uses videos to create awareness. This is because, with videos, homeowners can see a more realistic view of the property of interest.
20. Properties captured with drone images are known to be sold a lot faster than those without pictures by almost 70%.
21. Real estate agents are known to spend a minimum of $50 or a maximum of $250 on technology by about 36% of them. The percentage of agents that spend over $500 is about 23%.
22. A survey by Matter Port showed that agents who used virtual 3-dimensional Walkthrough videos concluded their deals faster by 31% and sold more properties by almost 10%.
Referral Statistics on Real Estate Businesses
Referrals come in handy when an agent has built their reputation to a profitable state; consequently, it takes time. A bulk of a real estate agent’s income stems from referrals. Referrals help to grow an agent’s career, and their importance cannot be ignored.
The ability to close deals and maintain a business or personal relationship with clients boosts the chances of referrals. The more referrals an agent has, the more income they make. Let’s check what the statistics have to say on this topic.
23. Possible home sellers have admitted the trait they seek from an estate agent is a professional reputation.
24. About 69% of property owners disclosed they wouldn’t mind writing a review if their agent requested it.
25. The ABOUT US page is the third most visited section of a real estate agent’s website.
26. Real estate agents with licenses make up 68% of agents with their websites.
27. 27% of property owners recommended their realtors about four or more times after selling their property. The average property owner has recommended their agent at least once after the closure of the transaction.
28. 63% of property owners found their realtors through a referral from a family member or close friend. Some are known to get referrals from agents they previously worked with.
Real Estate Statistics on Brokerage
An estate agent with a license is known to work under a firm or someone. They are not alone but must get a broker’s license if they become ambitious and want to move out or start a firm or association that can hire agents.
It is a known fact that brokers, on average, have more income than real estate agents. Brokers can also train agents and employ them. Recruiting new agents can be a huge challenge for a broker. Let us see the stats on this category.
29. Keeping pace with technological advancement can be difficult for real estate agents, with 45% of brokers admitting it’s a struggle for their agents.
30. Brokers in real estate are known to close an average of 14 deals yearly.
31. On average, An estate realtor works under a broker for 5 years.
32. 32% of real estate licenses are owned by brokers in America. Brokers’ and firms’ preferences for software usually fall into these categories;
- Multiple listing by 79%.
- A comparative market survey by 82%.
- E-signature by 83%.
- Electronic forms by 80%.
Statistics on “The Great Migration” to the Southern States
As of 2022, the business atmosphere in the southern region of America has been quite lucrative and competitive, with frequent bidding wars before deals are secured. It speaks volumes about the good economy of the area. Expectedly, it drew lots of attention from real estate agents and brokers nationwide, with many settling down within these regions to build a stable career in the real estate business.
Here are the following statistics on the migration.
33. Over 40% of real estate agents and brokers are found in New York, California, Texas, and Florida.
34. In 2022, 6 of the 10 largest-gaining counties made Texas their home. About 209,182 residents were recorded from Montgomery, Harris, Denton, Bexar, and Collins counties.
35. Population growth within the southern and western locations in the US was momentous. Florida leads the way with a growth of 1.87% in population as of 2022.
Environmental Statistics on Real Estate
36. 90% of investors worldwide have applied for Environment Society and Government policy(ESG).
37. One-third of housebuilders in America claim that green building is a meaningful portion of their general endeavors.
38. Buildings consume 40% of the energy produced around the world.
39. A report from 75% of business buildings with sustainable attributes claim an increase in the value of the building.
40. 70% of property owners use sustainable features in their buildings.
41. The energy use by buildings in America could be cut by almost 60% if sustainable attributes are applied to their buildings.
Conclusion
Knowing the factors affecting real estate market dynamics can’t be overstated. Both real estate agents, brokers, and even property owners can use this useful information to get better deals to maximize their profits. To achieve this, timing is of great essence. A property owner must know when to buy or sell properties after observing the market and certain factors. Also, the use of technology could double or triple the profit margin of interested parties in real estate. With this knowledge, a property owner, agent, or broker will make the most of the market.
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