Homebuyers who successfully purchased a home last year only viewed a median of eight homes before purchasing. For some buyers who put down multiple contracts and repeatedly lost bidding wars, this may seem like very few, however for others who found limited housing inventory in their area, it may seem like a wide selection.
Looking at the number of homes viewed historically provides a better perspective. NAR Research has tracked the number of homes viewed since 1987. Viewing eight homes before purchasing is the lowest number reported. At the height, buyers viewed 12 homes before purchasing in 2009 and 2011 as inventory was plentiful, following the Great Recession. During the housing boom years, 2004 to 2006, homes were moving at a rapid pace, but typically nine homes were viewed. Limited housing inventory has likely played a key role here. If there are few homes for sale in a price bracket, there are few homes to see. From the November 2021 existing-home sales data, there are just 1.1 million units for sale, a 13.3 percent decline from a year ago. However, one important change has happened since 2006: technology.
Homebuyers today can view homes online and quickly weed out what they want to see versus what can be discarded. Buyers can walk through virtual tours, view videos, see detailed photos in a way, 2006 technology did not allow. Among the eight homes viewed by buyers—three were viewed only online through virtual tours, virtual video tours, or virtual open houses. In 2006, 80% of buyers used the internet to search for homes. Today, that share is 95% of buyers. (It is shocking that 5% of buyers do not use online tools in the search process, but a similar share bought from the previous owner who they likely know. They likely are familiar with the property.) In 2006, 24% of buyers first spotted their home online. Today, that share is 51%.
Technology and tight inventory have also likely played a role in the number of weeks a buyer is searching for a new home. Buyers searched for just eight weeks before deciding on the home to purchase. From 2009 to 2013 buyers took their time and looked at homes over 12 weeks. As homes were moving at a slower pace, they could decide over a longer timeframe and perhaps view a home several times before putting in a contract. Buyers today do not have that luxury and need to make fast decisions on which home to place on offer on, as there is likely another buyer ready to pounce right behind them. From the November REALTORS® Confidence Index, homes typically had 3.8 offers in November 2021.
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Dr. Jessica Lautz is the Vice President of Demographics and Behavioral Insights at the National Association of REALTORS®.
