BofA Homebuyer Insights Report: Sense of community driving many first-time buyers

Anyone who has been trapped in their house for more than a year knows what homebuyers are looking for: A home office, and maybe a home schoolroom — and maybe even a room to escape to when you leave the office or your day job of teaching your child.

But that may not be it.

According to Bank of America’s 2021 Homebuyer Insights Report — the bank’s annual look at the market — what is outside of the house may be just as important as what is inside.

Bob Donovan, a senior vice president and division executive at Bank of America, said the report showed homebuyers are putting a greater emphasis on the community itself. It’s another example of how the pandemic has shifted wants and needs.

“The last year has really prompted people to reassess their priorities and goals,” he said. “Younger generations of buyers are telling us that community has become incredibly important to them.

“It makes sense. People aren’t on the run as much anymore. They’re not traveling for business. They’re not out and about as much. So, community has become a pretty important piece of the puzzle.”

According to the survey of 2,000 adults who currently own a home or plan to in the future, half (51%) of younger buyers — those ages 18 to 43 — and nearly one-third (32%) of older generations — ages 57 to 75 — said community has become more important over the past year.

Specifically, people want neighbors who share similar interests (73%) and are active in the community (70%).

Donovan said a large number of respondents said they are planning on being very active in their communities, too.

“People are really looking for a sense of connectedness and belonging,” he said. “You can definitely read that into the data.”

Here’s a look at some of the details of the report:

  • Nearly half (48%) of prospective homebuyers between 18 and 43 said the importance of square footage has increased.
  • Approximately 60% said outdoor space is more important to them now.
  • While 42% of younger prospective buyers currently live in cities, only 24% want to own a home there.
  • Half (48%) want to buy in the suburbs and 29% want to buy in rural areas.

Donovan said the biggest issue for first-time homebuyers hasn’t changed: the need for capital.

Bank of America, Donovan said, is doing something to change that. The bank recently made a $15 billion commitment to land in low- to moderate-income markets. The bank, he said, has set up two programs.

In one, BofA will provide up to $7,500 in closing costs credits. In the other — a down payment assistance program — BofA will grant a borrower up to 3% of their sale price, up to $10,000.

“I can tell you that young buyers, first-time homebuyers are taking advantage of these programs,” he said. “They are seeing this as an opportunity for them to have some equity in their home from Day One, but, for many, it’s an enabler — it allows them to get over the hump in terms of the capital required for a down payment.”

See the complete report here.