The inaugural Century 21 First-Time Homebuyer Index reveals that for many, the American “Dream Home” is a new, suburban single-family home located in the southern United States, the company announced today.
The national survey of 1,214 U.S. first-time home buyers, conducted by International Communications Research, found that when imagining where their “dream home” would be located, more respondents prefer suburban areas (46 percent) to rural (39 percent) or urban (15 percent). An overwhelming majority (78 percent) view their dream home as newly constructed. New construction is more appealing to younger respondents (83 percent for those aged 18 to 34, compared with 68 percent for those aged 35 to 64).
Survey respondents also imagine their dream home situated in the southern United States. The Southeast tallied the most votes at 27 percent followed by the Southwest in a close second at 23 percent. The Northeast (19 percent), Midwest (17 percent) and Northwest (14 percent) didn’t fare quite as well by region even though a number of northern cities were well regarded by respondents.
Securing the keys to these dream homes is considered a great challenge. Almost two-thirds of respondents (64 percent) believe it will take them more than five years to save the money needed to purchase their dream home. Only 3 percent of first-time home buyers contend they are already living in their dream home.
Other key findings from the Century 21 First-Time Homebuyer Index include:
“Ideal” Cities
Respondents’ viewpoints on ideal cities rest heavily on the influence of friends and family members who reside there. Reasons for identifying a particular city as ideal include:
- Reputation as a great city to raise a family (26 percent) in part due to highly regarded school systems and low crime rates
- Climate (22 percent)
- Proximity to water, sand and mountains (22 percent)
- Strong local economy with many job opportunities (16 percent)
- The top-ranked cities for all survey respondents include New York, Los Angeles and Chicago.
The “Real” First Home Purchase
According to survey respondents, the average length of time it took to find a first home is just over six months. The quality of the local education system is of prime concern. In contrast to their “Dream Home” aspirations, 73 percent of first-time home buyers said they looked for resale homes, while only 27 percent sought out new construction. Nearly half (48 percent) of respondents expect to move out of their first home in less than seven years. The top reasons for buying a first home include:
- Need more room/space (36 percent)
- Desire to build equity (24 percent)
- Marriage (12 percent)
- Need for privacy (10 percent)
- Job relocation (four percent)
Hispanic First-Time Homebuyers
Identifying the unique needs of Hispanic first-time homeowners, the survey yielded the following results.
Housing Costs and Financing Issues
The survey found that 78 percent of respondents paid or expected to pay less than $250,000 for their first home. The average first home price among respondents was $215,000.
Over one-quarter (28 percent) of respondents did/will receive help with the down payment from family members. Of those accepting help from others, 63 percent will look to their parents, 17 percent will go to their in-laws, while 7 percent will receive help from their grandparents. Fifty-six percent of surveyed respondents put down or planned to put down less than 20 percent of the home purchase price. Respondents from the Northeast made the largest down payments on average than any other region of the country (17 percent versus 14 percent in the Midwest and South and 15 percent in the West).
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