Key insights + statistics
- 87% of homebuyers still choose to hire realtors. (NAR)
- 73% of home owners are more likely to list with a real estate agent who uses videos to sell property. (Real Estate EDU)
- About 22% of all homes end up dropping their price within the first three months of being listed. (Washington Post)
- 91% of home sellers used a real estate agent to sell their homes in 2018. (REALTOR)
- In 2018, 50% of buyers found the home they purchased online. (NAR)
- As of 2018, there were roughly 2 million agents in the United States helping to close deals.
What is real estate?
Real estate is a fairly broad concept as it covers the actual property of a place (land, buildings, air above, ground below), as well as the legal identity of who owns, invests, and manages the property. The "real" in real estate refers to the physical, tangible land that comes with ownership.
For the majority of 2020, the housing market has seen some ups and downs, mostly due to the undeterminable nature of the effects of the COVID-19 pandemic on the economy. However, when looking back at the historic trend lines of real estate value, we're not doing too badly.
The Zebra gathered, analyzed, and visually reproduced data from the National Association of Realtors, the American Housing Census, and the US Census Bureau, as well as its own proprietary data to synthesize a complete look at the housing market today.
Table of contents
- Real estate facts
- Real estate market statistics
- Housing market facts and figures
- National statistics around affordable mortgage rates
- Housing facts for homebuyers
- Resources around realtors
- Homeowners insurance rates
- FAQs about real estate
Real estate data (updated)
In 2020, The Zebra surveyed 1,500 people (consisting of homeowners, renters, and non-homeowners) to determine public perception around real estate availability, homeownership, and quality of life.
Of the those surveyed, most already own real estate (55%) in 2020 and are proud to say their neighborhoods have good schools (37%). However, most still have never purchased a home for themselves (26.5%). A deeper look into what age groups have purchased a home are indicative of a fluctuating economy.
- Most millennials (ages 25-34) were less than 18 when they purchased their first home, about 34.8% of respondents.
- Most baby boomers (ages 55-64) were at least 60 before they could afford to buy their own home, indicating they recently purchased a home, about 24.8% of respondents.
- Of all respondents, most were between the ages of 25-30 years old when they purchased their first home (24.2%).
Of the 32.1% of respondents that already own real estate, many weren't as lucky.
- 23.6% said owning real estate is a financial goal of theirs they will likely accomplish before retirement.
- 9.6% believe they will never make enough money to purchase additional real estate.
- When asked if "When you retire, do you expect to own real estate?", 34.7% claimed this question did not apply to them.
Across the board, respondents agree that the housing market value for homes is rising. Respondents claimed that in the past two years the average home value in their neighborhood had:
- Increased (54.4%)
- Stayed the same (32.4%)
- Decreased (13.1%)
National real estate market statistics
In 2019, the real estate industry accounted for 17.5% of the gross state product for the United States. Despite the COVID 19 pandemic, after an all-time low in April of 2020, new home listings stayed at about 22% below their normal levels in May 2019, according to real estate brokerage Redfin.
- The real estate industry generated $24,471 in total income in 2019.
- New home construction generated $45,317 in total income in 2019.
- According to data from realtor.com, active listings were up by more than 10% in May compared to April in specific cities. These metros areas include:
- Honolulu, Hawaii
- San Francisco, California
- San Jose, California
- Denver, Colorado
- Colorado Springs, Colorado
- San Francisco, Detroit, and New York real estate markets slowed the most of all markets during the 2020 coronavirus pandemic (-53.9%, -46.8%, -45.8%).
Housing market facts and figures
According to a recent report from Redfin, in April of 2020, home sales plunged 22.5% from 2019. This downward trend continued further as homes newly listed and the homes available for sale also dropped (42.4% and 24.5% respectively). New data from the National Association of Realtors predicts that existing-home sales will reach 4.93 million units by the end of 2020 and new home sales will hit 690,000. NAR also posits that in 2021, sales are expected to rise to 5.35 million units for existing homes and 800,000 for new homes.
Home prices
- Since 1963, the national average home price has increased 5.6% based on data from the American Housing Census.
- According to the most recent available report from the American Census Bureau, the national median sales price of new houses sold in May 2020 was $317,900. The average sales price was $368,800.
- The overall growth rate of the median home sale price in the United States dropped from 6.9% to 4.9% when looking at 2019 - 2020. Home prices on average are still up from 2019.
- Within a year, the average rate of contract signings fell 5.1%, from recent Pending Home Sales Index data.
New homes built in 2020
- From May 2019, sales of recently built houses rose nearly 13%. Despite recent national economic setbacks, this rate for May has not been witnessed in more than a decade.
- NeighborhoodScout forecasts a more modest 4.5% increase in national real estate values in 2019, a significant deceleration from the 2018 increase of 7.6%, as market price increases are projected to slow substantially.
- Over the next three years, through 2021, the forecast calls for an even more modest 3.1% annual increase in residential property values, and a decline of -2.4% from 2021 to 2023.
- According to Zillow, homes priced between $250,000 and $500,000 sold the most, soaring 28.3 percent year-over-year.
National statistics around affordable mortgage rates
Mortgage rate statistics
Most mortgage rate data reflects growth trends of 30-year fixed rate mortgages across the United States. Homebuyers often favor a 30-year FRM (fixed rate mortgage) over a 15-year FRM for its lower monthly payment, but homebuyers who choose this type of rate often pay more interest long term. Lenders additionally offer alternative rates such as a 10-year or 40-year FRM. Here are the average rates of a 30-year FRM of the past 5 years:
| Year | Lowest Rate | Highest Rate | Average Rate |
|---|---|---|---|
| 2019 | 3.63% | 4.94% | 4.54% |
| 2018 | 3.95% | 5.34% | 4.25% |
| 2017 | 3.78% | 4.30% | 3.99% |
| 2016 | 3.41% | 4.32% | 3.65% |
| 2015 | 3.59% | 4.09% | 3.85% |
| 2014 | 3.80% | 4.53% | 4.17% |
National affordability levels
In recent years, states such as Texas, California, Florida, Oregon, and Washington have witnessed significant growth in land value and, therefore, the average value of homes.
- The national median sale price in April was $303,895.
- The median sales price of new houses sold in May 2020 was $317,900. The average sales price was $368,800.
While some view this change as favorable, increasingly we are seeing that households with a median income are not able to afford homes in these areas. Below are the top 10 metropolitan cities where the least amount of homes are affordable by a median-income household, according to the Joint Center for Housing Studies of Harvard University.
| Metropolitan Area | Percentage of Affordable Homes Sold |
|---|---|
| Los Angeles-Long Beach-Anaheim, CA | 12.75% |
| Salinas, CA | 14.59% |
| Santa Cruz-Watsonville, CA | 15.99% |
| San Francisco-Oakland-Hayward, CA | 17.05% |
| San Luis Obispo-Paso Robles-Arroyo Grande, CA | 18.69% |
| Oxnard-Thousand Oaks-Ventura, CA | 18.81% |
| Santa Rosa, CA | 20.14% |
| San Diego-Carlsbad, CA | 22.95% |
| San Jose-Sunnyvale-Santa Clara, CA | 23.36% |
| Barnstable Town, MA | 26.56% |
Housing facts for homebuyers
Nationwide, 59 percent of households (or 64 percent on average across metros) can afford typical monthly payments in their metro area.
Single family homes
- 683,000 single-family homes sold in 2019
- The median sales price of new single-family homes sold in 2019 was $321,500, while the average sales price was $383,900.
- The median size of a new single-family home sold in 2019 was 2,322 square feet.
| Category | June 2019 | June 2020 | Percent Change |
|---|---|---|---|
| Single Family Home Sales | 8,063 | 9,328 | 15.7% |
| Single Family Average Sales Prices | $321,884 | $319,881 | -0.6% |
| Single Family Pending Sales | 8,335 | 11,610 | 39.3% |
Millennials as homebuyers
According to a recent survey on millennials from the American Housing Survey,
- 14% live with unmarried partners
- 22% are single-person households
- 22% live with non-relatives
- 41% live with their married spouses
- 47% of households have children
- 62% of millennials rent, while only 38% own the home they’re living in.
- 39% live in multi-unit structures, like apartments or duplexes.
- 56% live in single-family homes.
- 61% have done some improvement to the homes they currently live in, due to energy efficiency (according to 30%)
- 77% of millennials
The house-hold breakdown for millennials is as follows:
Renters statistics
According to a recent survey on renters from the American Housing Survey,
- 32% of renter households include children.
- 37% are single person households.
- The median income for renters is $36,000
- 20% of Black households are renters, but this figure drops to 10% when looking at Black households as homeowners.
The following is a breakdown of the major cities in the U.S by their renters' population:
- Seattle, WA: 41%
- San Francisco, CA: 45%
- Los Angeles, CA: 52%
- Riverside, CA: 36%
- Phoenix, AZ: 35%
- Dallas, TX: 41%
- Houston, TX: 39%
- New Orleans, LA: 39%
- Atlanta, GA: 39%
- Miami, FL: 41%
- Washington, DC: 37%
- Philadelphia, PA: 32%
- Boston, MA: 39%
- New York, NY: 49%
- Detroit, MI: 31%
- Chicago, IL: 35%
Resources around realtors
- A 2020 survey conducted by The Zebra found that 29.8% of people found their current home through a real estate agent, while 18.8% used an online service, like Redfin or Zillow.
The Association of Real Estate License Law Officials (ARELLO) estimates that there are about 2 million active real estate licensees in the United States.
- 68% percent of realtors are licensed as sales agents, 20% hold broker licenses, and 14% hold broker associate licenses.
- 67% are women.
- Most realtors have an average 8 years of experience.
- The median realtor with 16 or more years of experience makes $71,000 in gross income.
How to become a real estate agent
Being a real estate agent is a rewarding career! While the process varies between every state, it’s quite easy to become a real estate agent and you can do it in five easy steps.
- Review your state’s qualifying requirements to earn your license. Each state has minimum requirements before you can be considered a licensed real estate agent. Find your state on the following site and become more familiar with the full process.
- In order to prepare for your licensing exam, sign up for a pre-licensing course. This is where you will learn about the ethics of being a real estate agent, how to start your business, and other necessary information. These can be taken online or in-person so be sure to choose the program best for you.
- Take your real estate licensing exam. Most states require a background check as well as a fee in order to take the licensing exam. Be sure to time it soon after you finish the course in order for the material as fresh as possible in your mind.
- Pass the exam! It’s a short, simple step but it can be tricky. Review what you learned in the course before taking it. Get a lot of good sleep the night before and eat a full breakfast the day of.
- When you pass, there’s one more step before you can officially begin to practice as a licensed real estate agent. Find a brokerage. Together you and the brokerage will fill out the final paperwork to the state. Then your license should be issued via mail and at that point, you are fully allowed to sell houses to the public!
Real estate lawsuit statistics
While many real estate agents enter into the industry with the best of intentions, but sometimes criminals still somehow slip through. According to the Wagenseller Law firm, “Real estate fraud applies when the other party has made a misrepresentation to you, you have reasonably relied on that misrepresentation and you were damaged by it.”
Examples of this misrepresentation include:
- Bodily injury to a client during a showing of a house.
- Negligence to share information that should have been disclosed to the client.
- Failing to recommend home inspections before the owners purchase a house.
- Failing to keep your client’s data safe from hackers.
- Breach of contract and failing to meet the requirements of the agreement.
- Misleading clients about the real conditions of the property.
- Giving legal advice about taxes on the property.
- Representing an area the real estate agent is unfamiliar with.
- Breach of duty by not putting the needs of the client first.
- Failing to disclose a defect in the property.
For more information, take it to the experts.
Homeowners insurance rates in 2020
As real estate value increases nationwide, home prices increase as well. Along with the monthly mortgage, homeowners insurance can be a significant expense. Get to know your homeowners policy — what it covers, what it doesn't — and you can end up saving a good chunk of change by not paying for coverages you don't need. Here are some quick answers about home insurance.
What does homeowners insurance cover?
Damages that are covered by homeowners insurance varies from policy to policy. The most common types of insurance policies are HO-2, HO-3, and HO-5.
Is homeowners insurance required?
Unlike auto insurance, having home insurance is not legally mandated or required.
How much does home insurance cost?
The average cost of homeowners insurance in 2020 is $1,631. Refer to the chart below for the average homeowners price in every state.
AVERAGE HOMEOWNERS INSURANCE PRICES BY STATE
Frequently Asked Questions around real estate
Q: What is real estate?
Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water.
Q: How do you start in real estate?
There are five steps to take to become a real estate agent:
- Review your state’s qualifying requirements to earn your license.
- In order to prepare for your licensing exam, sign up for a pre-licensing course.
- Take your real estate licensing exam.
- Pass the exam!
- Find a brokerage.
Q: What is an example of real estate?
There are four types of real estate: residential, commercial, industrial, and land.
Q: How can I be successful in real estate?
According to Inman.com, there are 9 ways to become a successful real estate agent.
- Partner with other agents to split referral bonuses.
- Use a publicist to get exposure.
- Pitch stories to reporters to angle yourself as a thought leader.
- Tap vendors and investors for leads.
- Host a lot of open houses to get people familiar with your face.
- Never turn down a deal.
- Make positive connections with past clients and referral sources.
- Hire a real estate coach to learn from the best.
- Cultivate an online presence through social media and content marketing.
Buying a home? Find home insurance that fits your monthly budget.
Sources
30-Year Fixed-Rate Mortgages Since 1971 | Freddie Mac
Historical Mortgage Rates Analysis | Bank Rate
Joint Center for Housing Studies | Harvard
Methodology
This study was conducted for The Zebra using Google Consumer Surveys. The sample consisted of no less than 1,000 completed responses per question. Post-stratification weighting has been applied to ensure an accurate and reliable representation of the total population. This survey was conducted in 2020.
Copyright © 2021 InsuranceZebra, Inc. All rights reserved. For inquiries regarding this content, please contact our team at statistics@thezebra.com.
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