{"version":1,"type":"rich","provider_name":"Libsyn","provider_url":"https:\/\/www.libsyn.com","height":90,"width":600,"title":"111: Center for REALTOR\u00ae Development 111: 2025 National & Local Market Outlook with Dr. Jessica Lautz from NAR: Part 2","description":"Welcome, friends, to the Center for REALTOR\u00ae Development podcast from the National  Association of REALTORS\u00ae. We are here in Part 2 with my guest, Dr. Jessica Lautz from NAR. Dr.  Lautz is the Deputy Chief Economist and Vice President of Research at the National Association  of REALTORS\u00ae.  We are releasing this interview in two episodes. This is Part 2.  Now, each one of these episodes stands alone, but we encourage you to start with Episode 1 or  even go back to it for some more context.  [1:10] Welcome back, my favorite data researcher! Thank you so much for being with me and with our  listeners. I love how you get to talk to everybody around the country and share all the good scoop and  help keep us informed.  [1:25] Dr. Lautz says it\u2019s a highlight of her job. She loves having boots on the ground, seeing what\u2019s  going on in local markets, what REALTORS\u00ae are feeling, and what the pulse is. Talking to people is  important.  [1:43] Monica recommends that listeners take the opportunity to go listen to Dr. Lautz and hear some of  her great stories.  [2:17] We\u2019re going to talk a little bit more specifically about clients and client needs, especially our first time home buyers. The demographic has shifted.  [2:40] Dr Lautz explores the data. First-time homebuyers are different today. First-time homebuyers have  dropped to the lowest level the NAR has ever recorded, dating back to 1981. It\u2019s just 24% of the market.  In a healthy market, it would be 40%.  [3:05] The 24% figure is an annual figure from last year. Monthly figures are ticking up, and this looks  like it will be a better spring for first-time home buyers.  [3:44] The median age of first-time homebuyers is now 38 years old. That\u2019s an all-time high. The  median age historically was 28. Housing affordability and lack of inventory are issues.  [4:13] Saving for a down payment is also difficult because of higher rent, student loan debt, childcare  costs, car loans, and inflation.  [4:33] First-time homebuyers\u2019 annual income has jumped by $26K in the last two years. The housing  market has removed anyone with a lower income. Doctors and investment bankers will win out over first  responders and schoolteachers. It\u2019s a different type of first-time homebuyer.  [5:25] First-time home buyers\u2019 down-payment sources are different, too. They\u2019re more likely to use  financial assets like stocks, 401(k), and cryptocurrency. They are still using the bank of Mom and Dad.  Inheritance use is also up.  [6:50] Dr. Lautz says we are seeing a generational transfer of wealth. The use of inheritances is at an all time high, but still in the single digits. Some parents are passing wealth along while they\u2019re still thriving.  We have seen it come down, though. It may be uncomfortable for a 40-year-old to ask a parent for cash. [8:11] Dr. Lautz sees some 20-somethings and even Gen Zers coming into the market. Gen Z makes up  3% of the market. Young Millennials and Gen Zers may have learned from the mistakes of older  Millennials who got graduate degrees. Some of that has to do with the Great Recession.  [8:41] The big thing we\u2019ve learned from today\u2019s young buyers is that they\u2019re willing to make some  financial sacrifices, like living with parents for a longer time, not paying a huge rent. That allows them to  earn homeownership sooner.  [9:49] Dr. Lautz has found that when these young adults move into home ownership, half of them had  been paying rent to family members they were living with.  [10:37] How does a young adult build a credit portfolio while paying rent to parents and living at home?  Dr. Lautz says that\u2019s a good question! What about people working in the gig economy? Monica says we  need to research that.  [11:58] Dr. Lautz says there are fewer sales at the lower price points. She thinks that translates into fewer  properties at lower price points. She is seeing growth in the luxury homes, or $1 million and up, sector.  Home prices keep going up. Homes at lower price points may not be move-in ready.  [13:00] An issue for first-time homebuyers is that lower-priced homes are not move-in-ready. First-time  homebuyers are buying the oldest homes, in the worst condition, where they need to put in remodeling  costs. That costs money. Unless you can DIY very confidently, you may have to hire someone to fix it.  [13:27] That may not be the best use of money for a cash-strapped first-time homebuyer.  [14:14] Dr. Lautz sees rental prices in a much better situation than in the last couple of years. In 2022,  there were bidding wars for rental units. So then builders built a lot of high-end multi-family properties to  meet the demand. Rental prices for a new lease have come down from where they were.  [16:10] Dr. Lautz speaks of people wanting nicer amenities in their rental, while they save to buy a home.  [16:42] We\u2019re also seeing a growth in built-for-rent single-family homes. In communities where ten  properties are being built, one of those single-family homes is just for rent. Builders understand there\u2019s  growth there as the age of first-time homebuyers goes up and families want to move into homes.  [17:38] Dr. Lautz says we need more new construction. Builder sentiment has retreated in the last  couple of months. Builders say the underbuilding has happened because of the lack of skilled labor,  the lack of land, permitting costs, and the lack of supplies.  [18:12] When we look at it as a nationwide whole, we\u2019re short about five million homes in the U.S.  We need to build that amount of homes to meet the pent-up demand that we have.  [18:51] Dr. Lautz says that in the last month, newer homes are within $100 of an existing home as a  national median. If a new home seller has a rate buydown program to attract buyers, that could be a  sweet spot for first-time homebuyers, working with a REALTOR\u00ae and representation, of course.  [20:01] Monica talks about the value of working with a REALTOR\u00ae when buying a new home, to  help with anything that could go wrong. An experienced agent who\u2019s done new construction deals  can help you watch for things and ask better questions. Be sure to get an inspector in the process.  [20:57] Dr. Lautz loves talking about single buyers. When we look at these trends, we see a reflection of  the U.S. There are fewer married couples in the home-buying market. We\u2019re seeing a lot of single  women. Dr. Lautz is impressed by single women. They\u2019re a quarter of first-time homebuyers. [21:21] As seniors in the market, single women are outperforming. This is also true for Gen Z. A first time homebuyer single woman is buying on a lower household income, saving for a longer period, and  purchasing her first home; it\u2019s important to her.  [22:03] Single women as homebuyers are more likely to be single moms. They\u2019re also more likely to  purchase multi-generational homes. Perhaps they have an elderly relative with them. They buy to  remove the unknowns. Knowing the school district. Knowing they don\u2019t have to worry about a landlord.  [22:45] Dr. Lautz sees single men first-time homebuyers moving because they have a job change or are  in retirement. She\u2019s not seeing many single men actively in the market. They have been about 10 or 11%  of the market since the 1980s.  [23:24] Monica cites Think and Grow Rich, about money as a motivator for men. She notes Think and  Grow Rich for Women came out more recently, focusing on the complex motivators for women. Monica  suggests asking men about their long-term goals and how homebuying increases their net worth.  [24:11] Monica says there are a lot of men and women of all ages who do want to get married but are  struggling to find a partner. Having a house and a sense of stability may be an attractive factor.  [25:44] Dr. Lautz says the majority of buyers now are repeat buyers. Their median age is 61 years.  Forty years ago, the median age would have been 36 years old, Baby Boomers have a lot of cash from  their housing equity. They want to move to be closer to their grandchildren or healthcare.  [26:38] Dr. Lautz says the NAR asked repeat home buyers what motivated them to move, and they  say it\u2019s downsizing, but the data shows they\u2019re downsizing 100 square feet, if that. They\u2019re going into  a newer, nicer space but not necessarily downsizing. Monica says it may be downsizing their yard.  [27:10] Some of them are moving into city centers, suburbs, or small towns, but someplace where they  have amenities or where they don\u2019t have to do outdoor upkeep. When they purchase at age 61, they\u2019re  planning on living there for 15 or 20 years. Aging in place is probably their intention.  [27:45] Monica talks about some features of 55-plus communities, with group activities, crafts, hobbies,  and making music together. Monica visited a community with parties. She went to one of the parties.  The band members were in their sixties and seventies. There was a great community and lots of activity.  [28:36] Dr Lautz thinks these communities are adapting to what Baby Boomers want, and it\u2019s different  from past generations at the same age. People are thriving and living longer and are healthier longer.  [29:16] Dr. Lautz has comments about pets. Pets are a $152 billion business in the U.S. Sixteen  percent of homebuyers said their pet will be a factor in their home-buying decision. The neighborhood  has to be walkable, the yard has to be fenced, and the grooming center and vet have to be close.  [30:39] REALTORS\u00ae can talk to their clients about a \u201ccatio\u201d or wide enough windowsills for cats,  where to put the litterbox, or other pet-related topics.  [32:01] Dr. Lautz\u2019s final word: It\u2019s an interesting market. We\u2019re seeing a lot of changes, whether it\u2019s  demographics, or seeing the all-time high of the all-cash buyer, or the struggle of first-time homebuyers.  Keep your pulse on all of the changes because it is a changing market.  [32:17] Please check on our research, it\u2019s a huge NAR benefit. It often goes under the radar. The  easiest way to check it out is to follow NAR Research on every social channel: LinkedIn, Instagram,  Facebook, X; we are everywhere that you are.  [32:34] Follow us and you can get the latest and greatest infographics, as well, that you can share  with your clients. [32:39] Monica adds that we all need some social media tools so you can go follow NAR  Research and share all their infographics. Somebody\u2019s doing the work for you to create things for  you to share. Awesome!  [32:51] Thank you so much, Dr. Jessica Lautz, for being with us here today and giving us the latest and  greatest scoop!  [33:01] I want to remind you again of all the learning opportunities at Learning.realtor. Go over there and  see what course you might need to fill in any gaps that you have about seniors, first-time homebuyers, or  mortgages. There are so many great courses there. New construction\u2026  [33:19] For almost everything we\u2019ve talked about, you can find a class over there. If you can\u2019t find it in  person, you can find it online at Learning.realtor. Thank you for joining us for Part 2!  [33:29] I\u2019m Monica Neubauer for NAR\u2019s Center for REALTOR\u00ae Development. Now, go out there  and sell some more houses, everybody!  Tweetables:  \u201cIt\u2019s a highlight of my job at NAR. \u2026 Boots on the ground, what\u2019s going on in all these local markets;  what REALTORS\u00ae are feeling and what the pulse is. It\u2019s important. You can get the survey data but  talking to people and getting the vibes is really important.\u201d \u2014 Dr. Jessica Lautz  \u201cIt\u2019s a different type of first-time home buyer. \u2026 Their down-payment sources are different. They\u2019re  more likely to use financial assets; we haven\u2019t seen that as high. \u2026 Stocks, 401(k), cryptocurrency,  even. Still using the bank of Mom and Dad.\u201d \u2014 Dr. Jessica Lautz  \u201cWhen we look at it as a nationwide whole, we\u2019re short about five million homes in the U.S. We need  to build that amount of homes to meet the pent-up demand that we have.\u201d \u2014 Dr. Jessica Lautz  \u201cIf a new home seller has a rate buydown program to attract buyers, that could be a sweet spot for  you, working with an agent who is a REALTOR\u00ae and representation, of course, to make sure you are  fully represented in that transaction.\u201d \u2014 Dr. Jessica Lautz  \u201cIt\u2019s an interesting market. We\u2019re seeing a lot of changes, whether it\u2019s demographics, or the all-time  high of the all-cash buyer, or the struggle of first-time homebuyers. Keep your pulse on all of the  changes because it is a changing market.\u201d \u2014 Dr. Jessica Lautz  Guest Links:   Dr. Jessica Lautz, is Deputy Chief Economist and Vice President of Research at the National Association  of REALTORS\u00ae.  NAR Resource Links   ABR\u00ae Accredited Buyer\u2019s Representative  Additional Links:   Crdpodcast@nar.realtor  Crdpodcast.REALTOR  Learning.REALTOR \u2014 for NAR Online Education  CRD.REALTOR \u2014 List of all courses offered  Host Information:  Monica Neubauer  Speaker\/Podcaster\/REALTOR\u00ae  Monica@MonicaNeubauer.com  MonicaNeubauer.com  FranklinTNBlog.com Monica\u2019s Facebook Page: Facebook.com\/Monica.Neubauer  Instagram: Instagram.com\/MonicaNeubauerSpeaks  Guest Bio  Dr. Jessica Lautz is the Deputy Chief Economist and Vice President of Research at the National  Association of REALTORS\u00ae. She has been with NAR since 2007.  The core of her research focuses on analyzing trends for both NAR members and housing consumers.  She is in demand as a speaker and by major media outlets to provide commentary on the real estate  market. She has testified before Congress on behalf of NAR.  She also volunteers at Nottingham Trent University as an industry fellow mentoring real estate graduate  students, is a committee chair at the National Association of Business Economics, bakes birthday cakes  for underserved youth with Cake4Kids, and sits on the board of the Food Recovery Network.  Dr. Lautz has been recognized by Housing Wire's Women of Influence and RISMedia's Newsmaker  award.  Jessica received her Doctorate in Real Estate from Nottingham Trent University in the United Kingdom.  She also holds a Master's in Public Policy from American University and undergraduate degrees in  Political Science and Law and Justice from Central Washington University. ","author_name":"Center for REALTOR\u00ae Development","author_url":"http:\/\/www.CRDpodcast.com","html":"