WASHINGTON (MNI) – The following is the first part of the text of
results from a survey published by the National Association of Realtors
Friday of home buyers and sellers:

Home buyers today have affirmed a long-term view of home ownership,
the typical seller is experiencing positive returns and the vast
majority of home owners see their property as a good investment,
according to the latest consumer survey of home buyers and sellers. The
study was released here today at the 2010 Realtors Conference & Expo.

The 2010 National Association of Realtors Profile of Home Buyers
and Sellers is the latest in a series of large national NAR surveys
evaluating demographics, preferences, marketing and experiences of
recent home buyers and sellers.

Although typical sellers had been in their previous home for eight
years, up from seven years in the 2009 study, first-time buyers plan to
stay for 10 years and repeat buyers plan to hold their property for 15
years.

NAR 2010 President Vicki Cox Golder, owner of Vicki L. Cox &
Associates in Tucson, Ariz., said the pattern of home buyers taking a
long-term view has solidified over the past few years. “This underscores
two simple facts — home ownership encourages stability, and the longer
you own, the better your investment.”

Even with several years of price declines, the typical seller who
purchased a home eight years ago experienced a median equity gain of
$33,000, a 24 percent increase, while sellers who were in their homes
for 11 to 15 years saw a median gain of 40 percent.

“Sellers who purchased at the top of the market and had to sell in
a short time frame were hurt by the price correction, but the vast
majority who are able to stay for a normal period of home ownership
generally built enough equity to make a trade-up purchase,” Golder said.
“Despite swings in the housing market in recent years, the fact is most
long-term owners see healthy gains in the value of their property.”

House flipping is virtually nonexistent in today’s market. “The
primary exception is for experienced investors, many of whom pay cash
and are making renovations or improvements after a careful study of
properties, neighborhoods and market demand,” Golder explained. “The
house flipping and quick gains which occurred during the boom period
were abnormal, driven by risky, easy-money financing that should never
have been allowed in the market.”

In the 2006 study, covering sellers during the close of the housing
boom, 6 percent of sellers had owned their property for less than a year
and a total of 30 percent had owned for three years or less. In the 2010
study, only 3 percent had owned their home for less than a year and a
total of 11 percent had owned for three years or less.

Paul Bishop, NAR vice president of research, said the lion’s share
of buyers view their home as a good investment. “Eighty-five percent of
recent home buyers see their home as a good investment, and nearly half
think that investment is better than stocks,” he said. “Even with the
turmoil created by the housing boom and bust, this indicates the
long-term view of home ownership as a fundamental goal and value remains
sound. In fact, the single biggest reason most people buy a home is the
simple desire to own a home of their own, cited by 31 percent of
respondents, including 53 percent of first-time buyers.”

The next biggest reasons for buying, identified by all home buyers,
were desire for a larger home, 9 percent; a change in family situation
and the home buyer tax credit, cited by 8 percent each; a job-related
move, 7 percent; and the affordability of homes, 6 percent. Twelve other
categories were 5 percent or less.

The number of first-time home buyers rose to a record high 50
percent of all home sales from 47 percent in the 2009 study, building on
success of the home buyer tax credit which began in 2009. The previous
cyclical high for first-time buyers was 44 percent in 1991; records date
back to 1981.

The profile shows the median age of first-time buyers was 30 and
the median income was $59,900. The typical first-time buyer purchased a
1,540 square foot home costing $152,000, with 93 percent using the
first-time buyer tax credit.

First-time buyers who made a downpayment used a variety of sources:
74 percent used savings, 27 percent received a gift from a friend or
relative, typically from their parents, and 9 percent received a loan
from a relative or friend. Eight percent tapped into a 401(k) fund, and
6 percent sold stocks or bonds. Ninety-five percent chose a fixed-rate
mortgage.

The shares of entry-level buyers receiving a gift or loan were
modestly higher than 2009 when 22 percent received a gift and 6 percent
a loan from a relative or friend. “It appears more parents were
motivated to help their children to take advantage of the home buyer tax
credit and very favorable affordability conditions,” Bishop said.

Fifty-six percent of entry level buyers financed their purchase
with an FHA loan, while another 7 percent used the VA loan program.
Forty-two percent said financing their first home was more difficult
than expected and 9 percent had been rejected by a lender.

Fifty-eight percent of all buyers are married couples, 20 percent
are single women, 12 percent single men, 8 percent unmarried couples and
1 percent other.

Bishop noted that women buyers have accounted for roughly one out
of five transactions since the late 1990s, and single men have been at
the one in 10 level since 1981. “A modest increase in the share of
single men buyers may result from the home buyer tax credit, but this is
the highest share for single men in the history of the study,” he said.

Buyers searched a median of 12 weeks and viewed 12 homes. Fourteen
percent of buyers own two or more homes.

The typical repeat buyer was 49 years old, earned $87,000, and
purchased a 2,000 square foot home costing $215,000.

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** Market News International Washington Bureau: 202-371-2121 **

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