Characteristics of the 2012 Minnesota Home Buyer

The 2012 Profile of Minnesota Home Buyers and Sellers describes the characteristics and motivations of recent home buyers and sellers in the Gopher State, and in so doing helps real estate professionals track the changing demands of consumers in a dynamic market.   This is a more pin-pointed report compared to the National report we published in the fall of 2012.  

Below are some of the findings from The 2012 Profile of Minnesota Home Buyers and Sellers, which was conducted by the National Association of REALTORS® Research Department for Minnesota REALTORS®.  This week we’re highlighting data findings about Minnesota Home Buyers in 2012 real estate transactions.  Next week we’ll review some Seller information. 

Characteristics of Minnesota Home Buyers        

• 41% of recent home buyers were first-time buyers in Minnesota, compared to a national level of 39%, which is a slight rise from 2011.
• The typical buyer in Minnesota was 37 years old, while nationally the typical buyer was 42 years old, a modest decrease from 45 in 2011.
• The 2011 median household income of buyers was $80,600 in Minnesota and $78,600 nationally.  The median income was $57,000 among first-time buyers and $96,800 among repeat buyers, compared to $61,800 among first-time buyers and $93,100 among repeat buyers nationally.
• Nationally, 65% of recent home buyers were married couples—the highest share since 2001.  In Minnesota, the figure was 58%.  16% of recent home buyers were single females nationally—the lowest share since 2001; 19% were single females in Minnesota. 
• For 30% of recent home buyers nationally, the primary reason for the recent home purchase was a desire to own a home.  In Minnesota, this was the primary reason for 27% of recent home buyers.

Characteristics of Homes Purchased

• New home purchases continue to drag at a share of 16% of all recent home purchases on a national level.  This is reflective of conditions in Minnesota, where 10% of homes were new.
• 73% of home buyers purchased a detached single-family home in Minnesota, compared to 79% of home buyers nationally.
• The quality of the neighborhood, convenience to job, and overall affordability of homes are the top three factors influencing neighborhood choice; however, neighborhood choice varies considerably among household compositions.
• When considering the purchase of a home, heating and cooling costs were at least somewhat important to 87% of buyers and commuting costs were considered at least somewhat important by 76% of buyers nationally, compared to 85% and 79% of buyers in Minnesota respectively.

  The Home Search Process

• For 41% of home buyers, the first step in the home-buying process was looking online for properties and 11% of home buyers first looked online for information about the home buying process on a national level.  In Minnesota, 41% of home buyers looked online for properties as a first step and 13% searched for information about the process online.
• The use of the Internet in the home search rose slightly on a national level to 90 percent and for buyers under the age of 44 this share increased to 96 percent.   In Minnesota, this number was 93% of all buyers and 97% of buyers under the age of 44. In Minnesota, 100% of home buyers 18 to 24 years searched for homes using the Internet.
• Real estate agents were viewed as a useful information source by 90% of buyers who used an agent while searching for a home in Minnesota, compared to 97% of buyers nationally.
• The typical home buyer in Minnesota searched for 12 weeks and viewed 15 homes, compared to 12 weeks and 10 homes on a national level.
• Nine in ten recent buyers were satisfied with the home buying process nationally, the same percentage of buyers satisfied with the process in Minnesota.

Home Buying and Real Estate Professionals

• Nationally, 89% of buyers purchased their home through a real estate agent or broker—a share that has steadily increased from 69% in 2001.   In Minnesota, this share was 95%.
• 40% of buyers found their agent through a referral from a friend or family member and only 10% used an agent they had used before to buy or sell a home on a national level.  In Minnesota, 44% used a referral to find an agent and only 12% used an agent they had used previously.
• About two-thirds of recent buyers nationally only interviewed one agent before they found the agent they worked with, slightly less than the 71% figure reported in Minnesota.
• Nearly nine in ten buyers nationally would use their agent again or recommend them to others. In Minnesota, that number is 88%.

Financing the Home Purchase

• On a national level, 87% of home buyers financed their recent home purchase. Among those who financed their home purchase, the buyers typically financed 91%.   In Minnesota, 90% of buyers financed their recent purchase and 91% of the purchase was financed.
• The share of first-time buyers who financed their home purchase was 95% compared to 81% of repeat buyers, nationally.  In Minnesota, that share was 95% of first-time buyers and 86% of repeat buyers.
• More than a third of home buyers nationally reported they have made some sacrifices such as reducing spending on luxury items, entertainment or clothing.  This also holds true in Minnesota.

Nationally, 23% of buyers reported the mortgage application and approval process was somewhat more difficult than expected and 17% reported it was much more difficult than expected.  These numbers are roughly equivalent to the Minnesota numbers, where 27% of buyers reported the process was somewhat more difficult than expected and 10% reported it was much more difficult than expected.

Comments

[Bing Markham]

I'd seen these Minnesota numbers but not compared to the National numbers and it is interesting to see how we compare to the rest of the country. Thanks for sharing both!

[Shah Kingdom Kharghar]

In this post all characteristic is nice. All are very informative and useful for buyers. All gave its own importance for buying its own home. Thank you sharing such nice information.