Realtors and other professionals that cater to the property market are preparing to enter the typically busy season for home sales. Several economic indicators point to a slower than average market this year. Continued high levels of unemployment and difficulties in obtaining financing are 2 problems that may crimp housing sales. But this year’s report by The Cotton Solution shows that the vacation home market may be recovering.
According to Cotton analysts, 42% of consumers are considering a real estate purchase this year, compared to 44% in 2010 and 36% in 2009. Those in the market for a new home say the purpose of the purchase will be:
- Primary home 38%
- Vacation home 36%
- Investment 26%
This is a huge improvement over 2010 for the vacation home market when only 4% of prospective buyers planned that purpose for the home.
In another bit of good news for realtors and home sellers, only 32% of prospective buyers must sell their homes prior to making a purchase. Last year, 42% of prospective buyers were in that position.
Here is the time frame for the planned purchase of a new home:
- Within 6 months 25%
- 6-12 months 37%
- 1-2 years 24%
- 2+ years 14%
From a marketing perspective, here are the sources that prospective buyers are using when they start a search for a new home:
- Internet 66%
- Real estate professional 27%
- Newspaper 5%
- Magazine 2%
The market still needs to improve in general to encourage more consumers to consider making a purchase in the immediate future. Over 26% of consumers say a price reduction of 20%-40% would bring them into the market while developer incentives and upgrades would induce 15% of consumers to buy immediately. Perhaps the best news for both sellers and realtors is that 36% of prospective home buyers are planning to make the purchase on a cash basis which means there will be no hold-up regarding financing and appraisals.[Source: 2011 Cotton Report. The Cotton Solution. March 2011. Web. 28 Mar. 2011]