Housing Then and Now: Trends in buying and selling across 35 years

Lance Evans

In December, I gave you some of the highlights of the National Association of Realtors (NAR) 35th Profile of Home Buyers and Sellers. When NAR released its first profile in 1981, mortgage rates were over four times higher than they are today, and first-time buyers made up a much larger share of overall sales.  While many home buyer and seller behaviors and preferences have changed, some have remained constant over the last 35 years.

                “When the Profile of Home Buyers and Sellers made its debut in 1981, consumers and Realtors navigated a much different real estate landscape. The internet hadn’t been invented and the average monthly mortgage rate was 15.12 percent,” said Debbie Gilson, president of the St. Lawrence County Board of Realtors. “One important constant during this time has been the Realtor’s role as the leading advocate for homeownership and a trusted expert in helping buyers and sellers close the deal.”

                With the recent release of the 2016 survey, it’s a great time to look at some of the data and trends in this year’s edition and how they stack up to the last three-and-a-half decades.

                The quickening pace of home sales over the past year included a small rebound from two key segments of buyers who have been missing in action in recent years: first-time buyers and single women.

                After slipping for three straight years, the share of sales to first-time home buyers in the 2016 survey ticked up to 35 percent, which is the highest since 2013 – when it was 38 percent – and a revival from the near 30-year low of 32 percent in 2015. In the 35-year history of NAR’s survey, the long-term average of first-time buyer transactions is 40 percent. 

                Married couples once again made up the largest share of buyers (at 66 percent) and had the highest income of $99,200. However, the survey revealed that single women made up more of the buyer share than in recent years, based on household composition. “After falling to 15 percent of buyers a year ago, which tied the lowest share since 2002, single females represented 17 percent of total purchases, the highest since 2011 at 18 percent,” noted Jefferson-Lewis Board of Realtors President Vickie Staie. “Thirty-five years ago, single females represented 11 percent of purchases.”

                Despite the internet’s growing popularity over the past 20 years, buyers and sellers continue to seek a real estate agent to buy or sell a home. “In NAR’s 2016 survey, nearly 90 percent of respondents worked with a real estate agent to buy or sell a home. This has brought for-sale-by-owner transactions down to 8 percent, their lowest share ever for the second year in a row,” said Ms. Staie.

                Since NAR’s inaugural survey, consumer preferences have evolved and housing costs have gotten more expensive. In 1981, the typical buyer purchased a 1,700-square-foot home costing $70,000 ($201,376 in inflation-adjusted dollars). In the 2016 survey, purchased homes were typically 1,650 square feet and cost $182,500.

                In 1989, when NAR started collecting buyer data on down payments, first-time homebuyers financed their purchase with a 10 percent down payment and repeat buyers financed a loan with a 23 percent down payment. As low-down-payment mortgage programs entered the marketplace and credit standards eased, the typical amount of money put down fell to as low as 2 percent for first-time buyers both in 2005 and 2006. “For repeat buyers, the smallest median down payment was 13 percent both in 2012 and 2014, which is likely due to reduced equity in the home that was sold,” observed Ms. Gilson.

                In recent years, down payment amounts have remained mostly unchanged, coming in at 6 percent for first-time buyers the last two surveys and either 13 percent or 14 percent for repeat buyers in the past four surveys. 

                Contact a member of the Jefferson-Lewis Board of Realtors (jlbor.com) or the St. Lawrence County Board of Realtors (slcmls.com) to connect with a Realtor to learn more about buying or selling a property.

 

Organic Milk Production in Jefferson Co. and NYS

Agri-business column by Jay Matteson

Northern New York is one of the leading dairy-producing regions in New York State and the nation. Dairy farms in Jefferson, Lewis and St. Lawrence counties combined produced approximately 1.8 billion pounds of milk in 2010.  That is a lot of milk!  All three counties rank in the top 10 of dairy-producing counties in the state and top 50 counties in the United States.

                We are also seeing continued growth in organic milk production in our region. According to Sharad Mathur, chief operating officer with Dairy Marketing Services, it is estimated that Northern New York has over 100 dairy farms producing about 5 million pounds of pure organic milk every day. Nearly one-third of the organic dairy farms in the state are located in Jefferson and St Lawrence counties. There are conventional dairy farms interested in converting to organic dairy production, but are looking for good markets for organic milk.

                Organic milk is different than conventional milk in that certified organic dairy farms are required to follow strict guidelines that govern use of pesticides, herbicides and type of fertilizer applied to farms, the type of feed that can be used to feed cows and the management practices a farm may use to keep cows healthy. The price organic dairy farms receive for every one hundred pounds of milk they ship is generally higher than what conventional farms receive for their milk, but the cost of producing one hundred pounds of organic is generally higher than producing one hundred of conventional milk.

                We are now seeing a limited number of farms further differentiating their production method by going to certified grass-based milk production.  This certification required the farms to follow a different set of regulations regarding the use of grass in feeding cows on the farm. Certified grass-based farms receive an even higher premium than organic farms.

                In our efforts to attract new agribusiness into Northern New York from Europe, this diversity in our milk production is important.  Our office is currently talking with two dairy manufacturing companies that are interested in organic milk.  The fact that Northern New York produces pure, high-quality milk, and especially is a leader in organic milk production, is critical to our efforts. Our area has potential to grow our dairy production, especially organic milk production, and that is what these two companies are looking at.

                For the consumer, we are very fortunate to live in an area where you have choices between pure and nutritious choices in dairy products.  Our farmers are fortunate that our soils, temperatures and terrain provide opportunities for diverse production methods that suit the management styles of the farm owners. Whatever your preference is for great tasting dairy products, Northern New York provides some of the purest milk available.