The Silent Generation: Downsizing Homes & Joining Senior-Related Housing

The Silent Generation, buyers aged 73 to 93 years, made up the smallest share of buyers by age at only seven percent of all home buyers in 2018. The median age for this group was 76 years old and they were born between 1925 and 1945. They tended to have the smallest families; 96 percent of these buyers had no children living at home under the age of 18 years and they made up the same share of single female buyers as Younger Boomers at 25 percent. Of the generations, buyers 73 to 93 years bought fewer multi-generational home at 13 percent. For those that purchased a multi-generational home, the reason was for the health and caretaking of aging relatives at 13 percent.

The Silent Generation had the smallest share of first-time home buyers at only four percent, which was expected for their age group. Correspondingly, they made up the largest share to move directly from a home that they owned at 82 percent. They also had the lowest median household income at $69,600, likely living off retirement funds. They managed their finances accordingly and bought homes with the second lowest median home price at $243,000. They also purchased some of the newest homes last year with a median year of 1996.

Buyers aged 73 to 93 years also bought new homes at 14 percent and wanted the amenities of new home construction communities (23 percent). These buyers were the most likely to purchase a duplex, apartment, or condominium at nine percent, or a townhouse at 10 percent. They were also the most likely to buy a home in senior-related housing at 29 percent. These buyers wanted a home convenient to friends and family (47 percent) and for the convenience to shopping (34 percent). They were the least likely to buy homes in an area for the quality of the school district, convenience to schools, or for the convenience to a job. They were also the least likely to compromise on the condition of the home (16 percent). The Silent Generation also bought frequently in a rural area at 23 percent.

The age group of buyers 73 to 93 years were the highest share among the generations to purchase for the desire to be closer to friends and family (27 percent) and for a smaller home (17 percent). They had an expected tenure in the home at a median of 10 years. They were the most likely to move due to a household member’s health and least likely to want a larger home.

Foreign Buyers Purchased $4.8 Billion in U.S. Commercial Real Estate in 2018

International clients are an important niche market for residential and commercial REALTORS® alike. In the latest 2019 Commercial Real Estate International Business Trends, NAR reported that foreign buyers purchased $4.8 billion of U.S. commercial real estate in 2018.[1] The median value for a buyer-side transaction was $600,000, while the median value for a seller-side transaction was $1 million. The dollar volume of foreign buyer purchases of U.S. commercial property declined in 2018 compared to the $6.7 billion in 2017 and $7.9 billion in 2016 as the economic expansion slowed in Asia (e.g., China, Japan), Canada, Europe (e.g. United Kingdom, Germany, France, Italy, and Spain), and Latin America.

Major Buyers of Commercial Property

Asia was the largest source of U.S. commercial property buyers, accounting for about a third (34 percent; 28 percent in 2017) followed by the Canada and Latin America (29 percent; 25 percent in 2017), Europe (20 percent; 29 percent in 2017), Middle East (10 percent; 12 percent in 2017), Oceania (2 percent; 1 percent in 2017), and from other countries that were not identified by respondents (3 percent; 6 percent in 2017).

The top foreign buyers of commercial property were China (21 percent), Canada (7 percent), Mexico (6 percent), Germany (5 percent), India (5 percent), Israel (5 percent), United Kingdom (5 percent), Venezuela (5 percent), Vietnam (5 percent), and Italy (4 percent).

Major Destinations of Buyers of Commercial Property

Florida was top choice among foreign buyers of U.S. commercial property (20 percent) followed by Illinois (13 percent), Texas (11 percent), and California (9 percent). Other top destinations were Georgia, New York, Virginia, Hawaii, Maryland, Massachusetts, Nevada, New Jersey, and Oklahoma.

Financing and Types of Property Purchased

About half of commercial foreign buyers, 52 percent, made an all-cash purchase (70 percent in 2017), and 25 percent obtained financing from a U.S. source.

International commercial buyers purchased across a variety of property types, but apartment was the most preferred, at apartment (19 percent), followed by retail (16 percent), land (12 percent), industrial (11 percent), office (9 percent), hotel (9 percent), and other types.

The bulk of foreign buyers of commercial property purchased the property as an investment to be rented out (39 percent in 2017), and 33 percent purchased the property for a business they participate in (34 percent in 2017). The Other category, which accounted for 22 percent (16 percent in 2017), includes a purchase of the property for residential and business-related uses.

Reasons Foreign Client Decided Not to Purchase U.S. Commercial Real Estate

One in five international clients decided not to purchase U.S. commercial properties in 2018 (17 percent in 2017). Understandably, the primary reason deterring a purchase is cost and exchange rate changes (36 percent of clients who decided not to purchase; 30 percent in 2017).Other major reasons are the buyer “could not find a property” (31 percent of clients who decided not to purchase), difficulty moving money out of the country (22 percent; 17 percent in 2017), tax-related issues (22 percent; 17 percent in 2017), immigration/visa (9 percent), and difficulty obtaining financing (9 percent).

[1] NAR also estimates foreign buyer purchases of U.S. residential property. According to the 2018 National Association of REALTORS® Profile of International Activity in U.S. Residential Real Estate, foreign buyers purchased $121 billion of residential property during April 2017—March 2018, or eight percent of the $1.6 trillion of total existing home sales during the same period.


February 2019 Housing Affordability Index

At the national level, housing affordability is up from last month but down from a year ago. Mortgage rates were down from last month at 4.60 percent this February, and up 4.1 percent compared to 4.42 percent a year ago.

  • Housing affordability declined from a year ago in February moving the index down 2.8 percent from 161.5 to 156.9. The median sales price for a single family home sold in February in the US was $251,400 up 3.6 percent from a year ago.
  • Nationally, mortgage rates were up 18 basis point from one year ago (one percentage point equals 100 basis points).
  • The payment as a percentage of income was down from last month at 15.9 percent this February and up from 15.5 percent from a year ago. Regionally, the West has the highest payment at 22.3 percent of income. The South had the second highest payment at 15.7 percent followed by the Northeast at 15.3 percent. The Midwest had the lowest payment as a percentage of income at 12.4 percent.

  • Regionally, the Midwest recorded the biggest increase in home prices at 5.5 percent. The Northeast had an increase of 3.9 percent while the West had a gain of 3.5 percent. The South had the smallest gain in price of 2.2 percent.
  • Regionally, all four regions saw a decline in affordability from a year ago. The Northeast had the biggest drop in affordability of 5.3 percent. The Midwest had a decline of 5.1 percent followed by the South that fell 1.8 percent. The West had the smallest drop of 0.9 percent.
  • On a monthly basis, affordability is up from last month in three of the four regions while the South was flat. The Northeast region had the biggest increase of 3.7 percent. The Midwest had an incline of 2.8 percent. The West had the smallest increase in affordability of 0.4 percent.
  • Despite month-to-month changes, the most affordable region was the Midwest, with an index value of 202.2. The least affordable region remained the West where the index was 112.2. For comparison, the index was 159.6 in the South, and 163.4 in the Northeast.

  • Mortgage applications are currently down while credit availability and new home purchase applications increased. There has been an increase in inventory of modestly prices homes. Median family incomes are growing 2.8 percent while home prices increased 3.6 percent. Despite being down from last year, affordability is up from last month in the US and in three of the four regions with the South being flat. Interest rates have dropped two months in a row, which will lower mortgage payments for future homebuyers.

  • What does housing affordability look like in your market? View the full data release here.
  • The Housing Affordability Index calculation assumes a 20 percent down payment and a 25 percent qualifying ratio (principal and interest payment to income). See further details on the methodology and assumptions behind the calculation here.

Which States Have Affordable Housing?

Finding affordable housing can be a challenge. Rents are often compared to the price of housing and many of those who rent desire to own a home. The typical renter has to factor in what portion of their income will they have to commit to housing.

Based on NAR’s home affordability index[1], the Midwest has been the most affordable region to own a home, which is comprised of Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Ohio, North Dakota, Nebraska, South Dakota and Wisconsin. The West has been the least affordable region to own a home, which is comprised of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.

Now, let us examine if there is any correlation with affordable rents and housing within the states and regions. Let us look at some of the states that have highest or lowest rent growth. I also want to examine the gross rent to income to find which states have favorable or less encouraging affordability conditions.  It is also necessary to look at which states are showing the highest and lowest renter income growth. For my analysis, I used rent data from and I estimated the 2018 median household income by adjusting the 2017 American Community Survey income data using wage growth data from the Bureau of Labor Statistics.

The Midwest is also the most affordable region to rent, with North Dakota having the lowest gross rent to income ratio at 24.9 percent while Ohio had the highest, at 27.5 percent. In all these states, the rent to income ratio is no higher than 30 percent; a threshold that indicates rent is burdensome for households.

The West and the Northeast are the least affordable regions to rent, having seven out of the top ten -states with the highest gross rent-to-income ratio. Out of the states with the highest gross to rent-to- income, Florida representing the South had the highest at 33.3 percent followed by Hawaii, Louisiana and California.

North Dakota led four of the other states in the Midwest region with a decline of 6.3 percent in rent growth.

Arizona and Nevada lead all states with the highest rent growth with an increase of 3.0 percent. Virginia had the smallest rent growth of the top ten at 1.7 percent.

Wyoming lead all states with the highest income growth at 9 percent. The remaining nine states from West Virginia to Wisconsin experienced income growth between 6 and 4 percent. Hawaii had a gain of 5 percent in income growth while being the only state on this list to having a decline in rent growth of 0.8 percent. The South and the West lead all regions in income growth.

New Hampshire and Mississippi were the only states to experience a decline of 1 percent in income growth. Utah, Arizona, Minnesota, Indiana, Alaska, and Nebraska were six of the ten lowest income growth at a 2 percent. Arizona showed rent growth of 3 percent and Delaware had rent growth of 2.4 percent. The South and the West have the highest gross rent-to-income ratios and they are the regions with the fastest rent growth. Renters will find it increasingly challenging to find affordable housing in these states.

Affordable housing is key for all income levels and finding the right state and region to live is key to allowing your income to work for you and provide stability. Finding affordable housing is affected by both income and the cost of housing (rent or mortgage). Consider how housing expenses and your income will look over time. Income growth varies per state and depends on the job growth and job quality, which refers not only to pay raises but other job attributes such as opportunity for personal development.

[1] To interpret the indices, a value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home. An index above 100 signifies that family earning the median income has more than enough income to qualify for a mortgage loan on a median-priced home, assuming a 20 percent down payment. For example, a composite HAI of 120.0 means a family earning the median family income has 120% of the income necessary to qualify for a conventional loan covering 80 percent of a median-priced existing single-family home. An increase in the HAI, then, shows that this family is more able to afford the median priced home. NAR HAI index as of January 2019.

Younger Boomers: Largest Share of Single Female Buyers

Younger Boomers, buyers aged 54 to 63 years, made up 18 percent of all home buyers in 2018, consistent with the previous year. The median age for this group was 59 years old and they were born between 1955 and 1964. One in four Younger Boomers was a single female buyer (25 percent), the same as the Silent Generation.

For Younger Boomers, the primary reasons they purchased homes were the desire to own a home of their own (17 percent), a job-related relocation or move (12 percent), and the desire to be closer to friends and family (10 percent). Compared to other buyers, they said it was the right time and that they were just ready to buy when they did (47 percent).

Younger Boomers were less likely to purchase in the suburbs (49 percent) and more likely to purchase in rural areas (21 percent) compared to other generations. They had the second highest median household income at $102,300 again this year. They also purchased the third most expensive homes of all generations at a median home price of $251,100, eclipsed this year by Older Millennials. This generation of buyers also purchased homes in size at a median square footage of 1,900. Younger Boomers purchased multi-generation homes at 15 percent (down from 20 percent last year), second now to Gen Xers, where they had been in the lead for many years.

Younger Boomers were the most likely to consider heating and cooling costs very important. This age group was unlikely to compromise on the price of the home as well as the quality of and distance from schools. Younger Boomers moved from their previous residence at a median of 20 miles.

Younger Boomers frequently looked online for properties for sale as their first step in the home search process (46 percent). They were also likely to cite yard signs as useful search information on homes (16 percent) more than other generations. Younger Boomers were very likely to use money from an inheritance for the downpayment of their home purchase.

Younger Boomers were the third largest share of home sellers last year at 21 percent. They had the third highest median incomes for sellers at $103,300 (Older Millennials surpassed them this year) and sold the second highest median priced homes at $275,000. Younger Boomers were more likely to sell a detached single-family home and sold the largest homes at a median of 2,100 square feet. They offered home warranty policies and credit towards remodeling or repairs as incentives to help sell the home.

REALTORS® Report Stronger Buyer Traffic as Affordability Improves

With mortgage rates on the decline and home prices appreciating at a slower pace, REALTORS® reported that homebuying traffic increased in February 2019 compared to one year ago, according to NAR’s February  2019 REALTORS® Confidence Index Survey.[1]

The REALTORS® Buyer Traffic Index increased to 55 in February 2019 from 52 in January 2019. The REALTORS® Buyer Traffic Index leads existing home sales by two months, so the uptick in February indicates a pickup in sales in April. The REALTORS® Buyer Traffic Index  fell below 50 during October–December 2018 as the 30-year fixed mortgage rate rose near five percent but the index  has been trending up with mortgage rates on the decline, with the 30-year fixed mortgage rate now at 4.06 percent as of the week of March 28.

Buyer traffic conditions were stable or improved in 39 states during the 3-month period of December 2018-February 2019 compared to the same period one year ago. However, buyer traffic weakened in the District of Columbia and in the rest of the states. Many respondents from California, Connecticut, Illinois, and Nebraska reported that the high property taxes—either due to high tax rates or high prices— have negatively affected sales. Respondents from California also reported the lingering effects of the California wildfires on the supply of and demand for homes.

Due to the combination of falling home prices and mortgage rates, the income needed to make an affordable mortgage payment (mortgage no more than 25 percent of income) on a median-priced home with 10 percent down payment and 30-year fixed rate mortgage decreased from $60,425 in June 2018 to $53,783 as of February 2019, and the difference of $6,642 represents a gain in buying power because one can afford a home purchase at a lower level of income.

In terms of the monthly mortgage, the mortgage payment arising on a median-priced home at 10 percent down payment has fallen from $1,259 in June 2018 to $1,120 as of February 2019, a savings of $138 per month, or $49,680 over a 30-year period.

 As of the week of March 28, the average 30-year fixed mortgage rate stood at 4.06 percent from a high of 4.94 in the weeks of November 8 and 15.[2]  Mortgage rates have trended downwards  given the March 2019 announcement of the Fed to be “patient” with increasing the benchmark federal funds rate[3] and to end its balance sheet reduction (monetary tightening) by September 2019, leaving at least $3.5 trillion in Treasury and mortgage backed securities.[4]  Market analysts are reading this policy stance to mean no interest rate increases in 2019 (given the latest economic data) and a 25 basis point rate increase in 2020.


[1]In a monthly survey of REALTORS®, NAR asks respondents “Compared to the same month (January) last year, how would you rate the past month’s traffic in neighborhood(s) or area(s) where you make most of your sales?” NAR compiles the responses into an index, where an index above 50 indicates that more respondents reported “stronger” traffic than “weaker” traffic.  In generating the buyer traffic index at the state level, NAR uses data for the last three surveys to have close to 30 observations. Small states such as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have fewer than 30 observations. The index is not seasonally adjusted, so a year-over-year comparison is appropriate.

[2] Freddie Mac’s survey of 30-year fixed rate mortgages

[3] Federal Reserve issues FOMC Statement, March 20, 2019; see

[4] Balance Sheet Normalization Principles and Plans; see

Existing-Home Sales Explained

What are Existing-Home Sales, and Why Does the Data Matter?

Existing-home sales data are a monthly measure of the sales volume and prices of existing single-family homes, condos, and co-ops nationwide. But what are existing-homes? Existing-homes, unlike new homes, are homes that are owned and occupied before coming onto the market. Existing-home sales account for more than 90 percent of total home sales, and the data captures completed transactions.

Click on the image below to read the full article:

Existing-Home Sales Explained

Gen Xers: Purchased Multigenerational & the Biggest Homes

Gen Xers, buyers aged 39 to 53 years, made up the second largest share of home buyers by generation at 24 percent of all home buyers in 2018, (down from 26 percent last year). The median age for this group was 45 years old and they were born between 1965 and 1979. They tended to have the largest families in the past, but were surpassed by Older Millennials this year. Fifty-six percent of these buyers had one or more children under the age of 18 years living at home—23 percent had two children under 18 years at home—and they made up the second largest share of buyers that were married couples at 65 percent. The primary reasons that Gen Xers purchased homes was the desire to own a home of their own, job-related relocation, and the desire for a larger home.

Gen Xers surpassed Younger Boomers this year and purchased the greatest share of multi-generational homes at 16 percent. They also made up the largest share that purchased detached single-family homes at 88 percent and had the highest median household income at $111,100, boosted by double income couples. They purchased homes in accordance with their incomes and bought the most expensive homes of all generations—a median home price of $277,800. This generation of buyers also purchased the largest homes in size at a median square feet of 2,100.

Buyers 39 to 53 years were also the most racially and ethnically diverse group of home buyers, with 25 percent identifying as a race other than White/Caucasian. This group also had the highest percentage of home buyers that speak another language besides English. Twelve percent of buyers 39 to 53 years were not born in the United States.

Gen Xers purchased new homes to avoid renovations and problems with plumbing and electricity and previously owned homes for a better overall value. These buyers purchased a short median distance from their previous home at a median of 11 miles. Gen Xers were the second most likely to purchase in neighborhoods that were convenient to schools. They also searched for a median of 10 weeks viewing a median of 10 homes.

Gen Xers primarily used savings and proceeds from a previous sale for the downpayment of their home purchased. However, these buyers were delayed five years from purchasing a home due to debt. Twenty-four percent of buyers 39 to 53 were delayed five years and 30 percent were delayed more than five years from buying a home. Of the buyers that said saving for the downpayment was the most difficult step in the buying process, 46 percent had credit card debt and 21 percent had childcare expenses, more than other generations. This group of buyers also had the highest median amount of student loan debt at $30,000, equal to Older Millennials. This group of buyers canceled vacations more than other age groups in order to save for a home. Gen Xers also had the highest share that sold a distressed property at 13 percent, primarily in 2011. Buyers 39 to 53 used a fixed-rate mortgage at 92 percent.

Gen Xers was the largest share of home sellers at 25 percent. They also had the highest median household income among sellers at $123,600 and sold homes at $250,000. Among Gen Xers sellers, 15 percent wanted to sell earlier but could not because their home was worse less than their mortgage. Gen X sellers’ tenure in the previous home was a median of nine years. Gen X sellers were the most racially and ethnically diverse of the generations. Their primary reasons for selling were that the home was too small, a job relocation, a change in family situation, and the neighborhood was less desirable.

REALTORS® Home Price Outlook Improves as Mortgage Rates Decline

About 3,000 REALTORS® who responded to NAR’s February 2019 EALTORS® Confidence Index Survey had more optimistic— although modest— home price growth expectations over the next 12 months. Respondents expect home prices to typically increase by 1.9 percent nationally, up from 1.4 percent in the January survey. NAR forecasts a 2.7 percent appreciation in the median existing homes sales price in 2019 (as of April 2019 outlook).

Based on responses received in the December 2018 through February 2019 surveys, REALTOR® respondents from Idaho and Alabama held the most optimistic outlook, with prices expected to increase by more than three percent to five percent over the next 12 months.

Respondents from Washington, Nevada, Utah, Arizona, Wyoming, Colorado, Oklahoma, South Dakota, Minnesota, Wisconsin, Indiana, Tennessee, Pennsylvania, Virginia, North Carolina, Tennessee, and Georgia expected prices to typically increase by more than two percent to three percent.

Respondents from states such as California, Texas, Illinois, New York, and Massachusetts held the most conservative price growth outlook, with prices expected to increase by no more than two percent.

Amid the decline in mortgage rates starting in December 2018, the median price of existing homes ticked up slightly in February 2019, to $249,500, from January’s $249,300. Home prices tend to increase seasonally in February compared to January but the higher year-on-year price appreciation of 3.6 percent in February 2019 from the 3.5 percent year-on-year price appreciation in January 2019 indicates the slowdown in home price appreciation may have turned a corner. The downtrend in interest rates will support this firming up in prices.

Across metro areas, the median list price of properties listed on rose in February 2019 has increased in many California metro areas compared to January 2019, though prices are still lower from one year ago: San Jose-Sunnyvale-Sta. Clara (8% m/m; -10% y/y), San Francisco-Oakland-Hayward (6% m/m; -1% y/y); Napa Valley (1.4% m/m; 6% y/y), Los Angeles-Long Beach-Anaheim  (2.1% m/m; -1.3% y/y)) and San Diego-Carlsbad (1.4% m/m; -2.3% y/y).

Instant reaction: NAR Chief Economist Lawrence Yun on March Jobs Report

The following is NAR Chief Economist Lawrence Yun’s reaction to this morning’s U.S. Bureau of Labor Statistics (BLS) report on the employment situation in March:

“The job market is quite remarkable as more job creations and wage gains are adding to the pent-up demand for housing. The many new job holders are seeking the starter home, but unfortunately, there is a grossly inadequate supply of moderately priced homes.  While most industries are experiencing a new high in total jobs in their sectors, the construction industry is still not back to its prior peak. The latest 16,000 net new construction jobs in March and 246,000 over the past 12 months are a welcoming trend. However, given the housing shortage, more workers are needed for homebuilding. There are around 300,000 job openings in the construction sector that are yet to be filled. Only from increased home construction will the housing market advance in a healthy way of home prices not rising faster than wage gains.”