Tightened Inventory Means More Time Looking At Fewer Homes

Republished from National Association of Relators® Economist’s Outlook November 18th, 2016. Written by Amanda Riggs.

Over three decades, the number of homes viewed during buyers’ home search process has decreased while the number of weeks that buyers search has increased. The Profile of Home Buyers and Sellers has collected data since 1987 on the length of the home search process and the number of homes viewed. This year, NAR celebrated its 35th anniversary of the profile report and to commemorate we take a look back at the data to compare how searching for a home has changed over time.

There has been a gradual move towards the midpoint in the home search process. Meaning, tightened inventory in recent years means there are less homes on the market and buyers must search longer for the right home. With fewer homes available, buyers also look a fewer homes that suit their needs.

In 1987, buyers searched for a median of seven weeks and looked at a median of 12 homes before ultimately purchasing a home. This is the shortest period of time buyers reported searching for a home, other than in 2001 when the length of the search was also a median of seven weeks. Throughout the late 1980’s, 1990’s, and early 2000’s, buyers searched for a steady median of eight weeks. In 2008, the number of weeks that buyers searched for a home bumped up to 10 weeks and up again to 12 weeks in 2009 where it remained until 2013. The median number of weeks that buyers searched went back down to 10 weeks in 2014 where is has remained for the last three years.

In 1987, buyers looked at a median of 12 homes before finally purchasing. The median number of homes dipped to 11 homes in 1989, but bumped back up to 12 homes where it remained until 1995. The number of homes viewed in the process slowly comes down to a median of 10 homes in 1997, then down to nine homes from 2004 to 2006, the fewest homes viewed in the timeline. The number of homes viewed jumped back up to 10 weeks in 2007 and to 12 weeks in 2009 through 2011, but fell again to a median of 10 homes in 2012 where it has remained for the last five years.

To follow this series as we discuss the findings of 35 years of profile data, check out the hashtag #NARHBSat35 on your social channels. NAR Research will be releasing trend line data since 1981 to celebrate 35 years of home buyer and seller demographic research.

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