It’s been a year since the frenzied market of 2021, and first-time buyers are struggling with costs, high interest rates and the ever-shrinking inventory of starter homes. But if there’s anything we’ve learned from the pandemic, it’s that first-time buyers are resilient.
New data from Opendoor shows that even the most stressed-out and battle-scarred first-time buyer hasn’t given up on their dream of homeownership even as the market continually shifts under their feet.
Being a first-time homebuyer is stressful, but vigilance seems to be a key to their success. (Image via Pexels)
As markets get tighter, buyers are spending more time hunting down houses
First-time homebuyers in today’s market are more vigilant and persistent than ever before. On average, buyers are spending more time checking online listings and touring homes – essentially jumping on every new opportunity that hits the market.
More than 41% of first-time homebuyers say they checked home listings sites several times in a week looking for new homes. Compared to last year when only 25% were checking regularly, that’s a dramatic increase.
But it looks like vigilance is a key to success. Those who purchased a home in the past month say they checked online listings an average of 12 times per day – nearly double the amount of time spent by those who purchased a home in the last 6-12 months.
In addition to the extra time spent browsing online, first-time buyers spent more time taking home tours.
The average number of in-person or virtual home tours that first-time buyers went to jumped from 15 in 2021 to 24 in 2022.
Thirty-three per cent of first-time buyers toured more than 20 homes, meaning a large chunk of them were more eager to look at any home that was available. Others were slightly more selective, with 25% of first-time buyers touring less than five homes.
All the time dedicated to the house hunt can feel like a second job – and for many, it nearly was. Sixty-five percent of homebuyers say they skipped out on work due to the homebuying process. On average, they lost 15 hours of office time – nearly two full workdays.
Millennial buyers were more willing to compromise
Usually, a home tour is an opportunity to see if you like a home enough to make an offer. But what about when you tour a home and don’t love it? Millennial buyers tended to throw their hats in anyways.
In 2022, first-time buyers made an average of 12 offers before purchasing a home. But that doesn’t necessarily mean they found the home of their dreams 12 times.
Nearly 2 in 3 first-time buyers admit to bidding for a home they didn’t really want – 70% of whom were parents. Forty-three percent confessed they did this more than once.
Millennials were the most willing to throw away their personal tastes, with 20% of them saying they made over five offers for homes they didn’t actually want.
Financial strain posed a challenge for many
Many homebuyers got by with a little help from their friends – or their parents, partners, and even strangers.
Co-signers were incredibly popular with first-time buyers, with family members and spouses being the most popular options.
Fifty-six percent of buyers relied on the contributions of their partner or spouse, while 16% bought homes with their parents, and 8% bought homes with their siblings. Most first-time buyers who purchased a home with their family were Gen Z.
Twenty-three percent of first-time buyers purchased a home with someone else who wasn’t a family member, including friends (15%), colleagues (8%), and even people they met online (7%).
Only 17% purchased a home by themselves.
While budgets remain tight for many first-time buyers, 90% of them say they found ways to save money on fees during the process. These savvy consumers report doing their own research, asking more questions and negotiating on the price of the fees.
Some first-time buyers purchased homes with friends or family to lessen the financial strain. (Image via Pexels)
Successful buyers felt confident in their choices
Being a first-time buyer is not easy, but the majority of those who did end up buying a house this year say they felt empowered by the experience.
Nearly 70% of buyers felt confident that they had found the best home for them on the market, including 92% of Boomers and 72% of Millennials, who were most willing to compromise on the homes they placed bids for.
While the majority of buyers feel they found a home that suits their needs, many say that’s the hardest part.
Despite all the time spent hunting for the perfect home, 43% of buyers felt the most difficult of the process was finding a home that was right for them.
If you’re looking to buy your first home, check out our first-time homebuyer guide.
