what homebuyers want in 2017... and how the industry can help

What homebuyers want in 2017 and how the industry can help

© 2017 ValueInsured and PVI Agency, LLC 1

Scenario

With interest rates rising and a vast majority of homeowners already locked into low rates, refinancing is set to drop $400B in 2017 leaving new home purchases to fill in the gaps.

• So, what motivates homebuyers in 2017?

• Who is the ‘modern homebuyer’ and how has the millennial mindset affected the way we need to service them?

• How can you recognize the needs of today’s homebuyers and what can you do about it?


Market challenges

Interest rates have been at historic low. Now going up.

Since the 2008 housing crisis and subprime mortgage-triggered recession, unemployment rate has steadily decreased, all economic indicators have rebounded, and home prices have recovered in most parts of the country. But now, greater uncertainty along with rates are increasing.

Homeownership rate down 11-years straight.

According to the latest U.S. Census and NAR reports, homeownership rate is on an 11-year consecutive downward trend. First-time homeowners now make up 32% of all new home transactions, down from 40% before the 2008 bust, while demographically, the potential first-time buyer population has increased with the coming of age of Millennials.

3

Icon/infographic Icon/infographic

© 2017 ValueInsured and PVI Agency, LLC

The Modern HomebuyerThey are constantly evolving


Today’s homebuyers have grown up in a period of uncertainty and technology advances changing how they look at homebuying.

1. They still have cold feet – doubts about buying, the market, affordability and an uncertain future

2. They aren’t brand focused – they look for value and trust and have no brand affinity with agents or lenders

3. Consumption preferences have changed –they rent, they move, they buy on a phone

4. They have more distrust of the mortgage and finance industries

Knowing these help us refine our messages and those that do so are in an unique position to help attract this next generation of buyers for the industry.

ValueInsured InsightsModern Homebuyer Survey


Insights available at valueinsured.com/trends

Modern homebuyers are nomadic. 86% of Millennial homeowners plan to stay in their current home for less than 7 years

6

This exposes many to higher risks of market fluctuations, and deters others form buying all together.

© 2017 ValueInsured and PVI Agency, LLC

Millennials are largest generational cohort in U.S. history. They want to own a home but need more confidence to buy


More on generational shifts: Millennials plan to spend big, while Boomers plan to downsize

8© 2017 ValueInsured and PVI Agency, LLC

Next generation homebuyers are 66% morelikely to buy a multi-generational home


Industry innovations e.g. low down payment and online shopping are changing modern homebuyer profile, behaviors and expectations


After a record housing year, modern homebuyers fear home prices are overheated


Looking ahead for 2017, housing confidence is holding steady, with some weakness showing among homeowners


Cautious optimism appears to be the new theme of 2017


Highest HHI ≠ highest optimism likely due to expectations that markets are overheated.


Highest income Americans seem most concerned that market has peaked. Middle-income Americans appear more optimistic.

As overheated prices cool, more first-time buyers now feel a new home is within reach



What can you do?

1. Become a trusted adviser


• Real-estate is local; you must be personal

• Avoid the Race to bottom

• Shift is to value and values -differentiate to meet expectations of fairness, flexibility and control

2. Embrace the

“millennial –mindset”


• Attract buyers who work on phones, appreciate design, simplicity and speed

• Modernize - look towards lifestyle imagery and not the standard clip art

• Speak to their needs not yours

3. Discuss “real” costs to deepen

relationship


• Know that there will always be someone cheaper

• Advise on long-terms costs not just the initial outlay

• Relate to monthly payments vs broader costs


Thank You!

valueinsured.com@valueinsured

what homebuyers want in 2017... and how the industry can help

Economy & Finance