2013 Survey of California Home Buyers. Survey Methodology 1,400 telephone interviews conducted in...
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Transcript of 2013 Survey of California Home Buyers. Survey Methodology 1,400 telephone interviews conducted in...
2013 Survey of CaliforniaHome Buyers
Survey Methodology
1,400 telephone interviews conducted in March 2013
Respondents are home buyers who purchased in previous 6 months
Maximum sampling error: ±3.5% at two standard deviations (a 95% confidence level). (Subsets of the total sample will have a higher sampling error.)
About the Buyer
53%female
63% minority
38 years old
37% single
61% college degree
2/3 household income >
$100k
Typical 2013 California Buyer
Buyer Gender Remains a Fairly Equal Male/Female Split
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%20%30%40%50%60%70%80%90%
100%
36% 36% 38% 39% 43% 42% 44% 42% 41%52% 47% 47%
64% 64% 62% 61% 57% 58% 56% 58% 59%48% 53% 53%
Male Female
Average Age: 38
< 25 (3%)25-34 (22%)
35-44 (21%)
45-54 (20%)
55-64 (18%)
Q. What is your age?
Percentage of Younger Buyers Drops
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%20%30%40%50%60%70%80%90%
100%
Under 25 25-34 35-44 45-5455-64 65+ Refused
Buyers Age Rises Slightly
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
5
10
15
20
25
30
35
40
45
50
Average Age Median Age
Minorities are the Majority
Q. How would you describe your ethnic background?
WhiteHispanicBlackIndianOther AsianOtherChineseKoreanFilipino
White 37%
Korean 5%
Black 8%Hispanic 26%
Filipino 4%
Indian 8%
Other 1%Chinese 4%
Other Asian 7%
Ethnic Background of Buyers Resembles CA Population
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 CA*0%
10%20%30%40%50%60%70%80%90%
100%
White Black Asian/Pacific IslanderHispanic Other
*Source: U.S. Census Bureau 2011 American Community Survey
Singles Made Up 37% of Buyers in 2013
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
63%
37%
Married Single
More than Half of Buyers have College Degrees
9% 15%
16%
45%
16%
High School Some College Vocation/TechnicalCollege Grad Post Grad
Q. What is the highest level of education you have completed?
Most Buyers are Well Educated
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
0%10%20%30%40%50%60%70%80%90%
100%
High School Some College Vocation/TechnicalCollege Grad Post Grad
Nearly 2/3 of Buyers have an Annual Household Income > $100K
3%
33%
30%
19%
14%
$50-000-$74,999$75,000-$99,999$100,000-$149,999$150,000-$199,999$200,000 +
Q. Which of the following categories best represents you total annual income from all sources?
Buyers’ Annual Household Income Remains Steady
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%20%30%40%50%60%70%80%90%
100%
Under $50,000 $50-000-$74,999 $75,000-$99,999$100,000-$149,999 $150,000-$199,999 $200,000 +
Q. Which of the following categories best represents you total annual income from all sources?
Residence Location
58%24%
18%
Southern CANorthern CAOther CA
Geographical Distribution of Purchases has Remained Steady
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
SoCal NorCal Other CA
The Buying Experience
Median Distance from Previous Residence: 27 Miles
1-10 11-25 26-100 >1000%
5%
10%
15%
20%
25%
30%
30% 29%
16%
25%
Miles
Q. How many miles away was your previous residence from the home you bought?
Half of Buyers Were Previous Owners
Owned50%
Rented38%
Lived with Parents
6%
Live with Other Rela-tive/Friend
6%
Q. What was the living arrangement immediately before your recent home purchase?
More than 7 out of 10 1st-time Buyers Were Renters
Rented72%
Lived with Parents
14%
Military12%
Live with Other Rela-tive/Friend
3%
Q. What was the living arrangement immediately before your recent home purchase?
More Buyers Owned Previous Residence
2011 2012 20130%
10%20%30%40%50%60%70%80%90%
100%
49%38%
50%
48%54% 38%
3%7% 6%
2%6%
Owned RentedLived with parents Other
DecisionFactors
Average Buyer Spent 6 Months Considering Purchase Before Contacting Agent
3-7 Weeks
8-12 Weeks
16-24 Weeks
36+ Weeks
0% 10% 20% 30% 40% 50%
26%
42%
15%
17%
Q. How many weeks did you consider buying a home before contacting a real estate agent? (Asked if agent was used)
Buyers Spending More Time Considering a Purchase Before Contacting Agent
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
3.9 3.9 4.0 3.8 3.85.6
7.28.4 8.6
16.6
12.2
23.7
Q. How many weeks did you consider buying a home before contacting a real estate agent? (Asked if agent was used)
Average Weeks
Average Buyer Investigates Homes/Neighborhoods More than 9 Months Before Contacting Agent
3-7 weeks
8-12 weeks
16+ weeks
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
26%
42%
32%
Q. How many weeks did you spend investigating homes and neighborhoods before contacting a real estate agent? (Asked if agent was used)
Buyers Spending More Time Investigating Homes & Neighborhoods Before Contacting Agent
Q. How many weeks did you spend investigating homes and neighborhoods before contacting a real estate agent? (Asked if agent was used)
Average Weeks
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
3.9 3.0 3.2 3.0 3.15.4 6.2 6.6 6.8 6.2 6.5
28.5
Average Buyer Searched for a Home for 2 Months with Agent
2 Weeks Or Less
3-7 Weeks 8-12 Weeks 14-16 Weeks 18-24 Weeks0%
34%
40%
18%
6%
Q. Once you found your agent, about how many weeks did you spend looking for a home with your agent? (Asked if agent was used)
The Home Search is Getting Lengthier
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
2
4
6
8
10
12Median Weeks
Q. Once you found your agent, about how many weeks did you spend looking for a home with your agent? (Asked if agent was used)
All Buyers Viewed at Least 8 Homes Before Buying
8 -10 11-29 20-29 30-39 40 -50
63%
12%5% 5%
14%
Average = 9 HomesMedian = 10 Homes
Q. How many different homes did you preview and visit with your agent prior to making a purchase?
Drop in Homes Viewed Reflects Tight Inventory
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
1110
910
11
1514 14
15
12
10 10
Q. How many different homes did you preview and visit with your agent prior to making a purchase?
Median
85% of Buyers Made Offers on Other Homes
0 1 2 3 4 5 6 70%
5%
10%
15%
20%
25%
30%
15%12%
9%
30%
10%13%
7%5%
Number of Offers
Q. How many offers did you make on other homes?
1/3 of Buyers Settled on Best Available Home
66%
34%
SatisfiedSelected best option given limited supply
Q. Are you satisfied with the home you purchased or do you feel like you selected the best option given the limited supply of homes?
Price Decreases Were Primary Reason for Buying
Long -term appreciation
Change in family
Desired larger home
Tired of renting
Promotion/raise
Investment/Tax advantage
Favorable price/financing
Desired better/other location
Price decreases
5%
5%
6%
7%
7%
9%
12%
10%
38%
Q. What were your main reasons for buying your home?
Buyers Didn’t Purchase Sooner Because…
48% •Not many good housing options
37% •Waited to see when prices would stabilize
28% •Difficulty qualifying for mortgage
21% •No real buying urgency
19% •Need to accumulate adequate down payment
15% •Wanted to wait until financial situation more solid
11% •Needed to sell existing home
Q. Why didn’t you buy a home sooner?
Average Buyer Plans to Keep Home for 6 Years
3 4 5 6 10 Unsure0%
5%
10%
15%
20%
25%
30%
35%
40%
Years
Q. How long do you plan to keep the property?
Most Buyers Found Home through Agent
For Sale Sign, 2%
Website, 37%
Agent, 61%
Q. How did you find the home you purchased?
More Buyers are Finding Homes Online
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
0%10%20%30%40%50%60%70%80%90%
100%Agent Website For Sale Sign Friend/Family Open House Driving Around Other
Q. How did you find the home you purchased?
Most Homes Were Listed on MLS
Yes89%
No11%
Q. Was the home you purchased listed on a multiple listing service?
Buyers Optimistic About Long Term Direction of Home Prices
Up
Flat
Unsure
1 Year 5 YearsQ Do you think home prices in the neighborhood where you purchased will go up,
down, or stay flat … in one year, in five years?
Buyer Optimism About Future Home Prices Improved
In 1 Year In 5 Years
36%
60%
20132012201120102009
Q Do you think home prices in the neighborhood where you purchased will go up in one year, in five years?
Internet Use
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013-20%
0%
20%
40%
60%
80%
100%
120%
Yes (Internet Buyers) No (Traditional Buyers)
Q. Did you use the Internet as an important part of your home-buying and selection process?
Nearly All Buyers Use the Internet
Buyers Primarily Accessed Internet by Phone
70%
15%
8%7%
Mobile/smart phoneTabletLaptopDesktop
Q. How did you primarily access the internet during the home buying process?
Multitude of Mobile Device Uses
90% •Access internet
78% •Look for comparable prices
47% •Search for homes
45% •Communicate
44% •Search websites, take photos of homes/amenities/neighborhoods
22% •Research communities/neighborhoods
11% •Create videos of homes, amenities, neighborhoods
10% •Research agents
Q. How did you use your mobile device in the home buying process?
Realtor.com & Zillow are Most Useful Websites in Buying Process
Q. What was the single most useful website that you visited during your home buying process?
0% 5% 10% 15% 20% 25% 30% 35%
5%
6%
7%
8%
9%
28%
30%
Brokerage
Agent
Top 3 Most Useful Websites Unchanged
2007 2008 2009 2010 2011 2012 20130%5%
10%15%20%25%30%35%40%45%50%
Zillow realtor.com Brokerage Yahoo
Most Buyers Found Home on Realtor.com or Zillow
0% 5% 10% 15% 20% 25% 30% 35%
4%
5%
6%
7%
7%
13%
23%
31%
Q. On which website did you find your home?
Realtor.com & Trulia Helped More Buyers Find Homes
2011 2012 20130%
5%
10%
15%
20%
25%
30%
35%Agent realtor.com BrokerageZillow Trulia Redfin
Q. On which website did you find your home?
Social Media Use on the Rise
2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
80%
52%
68%75%
Q. Did you use social media (such as Facebook, Twitter, YouTube, etc.) in your home buying process?
Social Media Used for Buying Tips & Neighborhood Info
Neighborhood amenities
Neighborhood lifestlye
Agent referrals
Agent's Facebook page
Neighborhood info from friends
Buying tips, suggestions from friends
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
19%
28%
32%
41%
42%
43%
Q. How did you use social media (such as Facebook, Twitter, YouTube, etc.) in your home buying process?
Buying Tips & Neighborhood Info Remain Popular on Social Media
2011 2012 20130%
20%
40%
60%
80%
100%
120%
140%
160%
180%
200%Buying tips Friend neighborhood comments Agents' Facebook
Agent referals from friends Agent home videos
Q. How did you use social media (such as Facebook, Twitter, YouTube, etc.) in your home buying process?
91% of Buyers are Receptive to Receiving Information via Social Media
2 3 4 5
9%
22% 20%
49%
Not Inter-ested
Extremely Receptive
Average Rating = 4.09
Q. How receptive would you be to receiving information about the home buying process directly from your real estate agent via social media? Rate how receptive
you would be on a 1-5 scale, where 1 = “not at all interested” and 5 = “extremely receptive”.
Buyers Remain Receptive to Receiving Information Via Social Media
2011 2012 20131.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.04.2 4.1 4.1
Average
Q. How receptive would you be to receiving information about the home buying process directly from your real estate agent via social media? (Scale: 1-5)
Financing
Majority Obtain Financing
2009 2010 2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%100%
94% 92%96%
91%
Q. Did you obtain financing for your home purchase?
Average Down Payment Remains Above 20%
2009 2010 2011 2012 20130%
5%
10%
15%
20%
25%
30%
35%
Average
Q. What was your down payment for the home purchased, in percent of the home value?
Most Buyers Obtain Fixed Rate Loans
Fixed 91%
Ad-justable 8%
One or more family mem-bers 1%
Q. What type of loan do you have?
Fixed Rate Loans Remain Majority
2009 2010 2011 2012 20130%
10%20%30%40%50%60%70%80%90%
100%
69%79% 84%
93% 91%
31% 15%16%
7% 8%6% 1%
Fixed Adjustable Other
85% of Loans are for 30 Years
20112012
2013
0%
20%
40%
60%
80%
100%
85%87%
85%
15% 13%15%
< 30 Year 30 Year
Q. What was the duration of your loan?
Buyers Continue Having Difficulty With Financing
20092010
20112012
2013
0.01.02.03.04.05.06.07.08.09.0 8.1 8.5
8.0 8.5 8.6
Average
Q. Please rate how easy or difficult it was to obtain financing on a scale of 1 to 10 with 1 being very easy and 10 being very difficult.
Financing is Difficult to Obtain
1 2 3 4 5 6 7 8 9 100%5%
10%15%20%25%30%35%40%
2009 2010 2011 2012
Q. Please rate how easy or difficult it was to obtain financing on a scale of 1 to 10 with 1 being very easy and 10 being very difficult.
EASY DIFFICULT
Most Buyers Did Not Have Appraisal Problems
83%
12%
5%
NoneHad to get 2nd appraisalHad to find more recent comps
Q. What, if any, problems did you have with the home appraisal when attempting to obtain financing?
What Buyers Would Change About the Home Buying Experience
1. Better Communication with agent (31%)
2. Faster agent response (24%)
3. Better agent negotiation (19%)
4. Better market understanding (14%)
5. Escrow close on time (7%)
Q. If there was one thing you could change about the home buying experience, what would it be?
Buyer / Agent Relationship
Nearly All Buyers Use an Agent
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%91%
Q. Did you use a real estate agent in your home buying process?
Most Buyers Find Agents Online
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
0%10%20%30%40%50%60%70%80%90%
100%
Relationships/Contacts AdvertisingInternet Other
Q. How did you find your real estate agent?
More than 8 out of 10 Buyers Interviewed at Least 2 Agents
Q. How many agents did you interview prior to selecting the agent you used in your recent home purchase?
1 2 3 4 5+0%
5%
10%
15%
20%
25%
30%
19%
26%
12%
21% 22%
# of Agents Interviewed
Buyers Continue Interviewing Multiple Agents
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
Average
Response Time is Important to Buyers in Selecting Agent
Most qualified
Most knowledgeable
Previous relationship
Distressed property knowledge
Negotiating ability
1st to respond
Most aggressive
Most reponsive
5%
4%
6%
9%
11%
17%
17%
32%
Q. What was the single most important reason for selecting the agent that you used in your recent home purchase?.
More Buyers Google their Agent
Q. Did you Google your agent…?
2007 2008 2009 2010 2011 2012 20130%
10%
20%
30%
40%
50%
60%
70%
80%
TelephoneEmail
Text MessageIn Person
17%
50%
29%
4%
51%
43%
5%
0%
Preferred Actual
Gap in Phone & Text Communication
Q. What was your preferred method of communicating with your agent?
Q. How did your agent actually communicate with you?
Room for Improvement in Agent Response Time
Instantly Within 30 mins.
Within 1 hr.
Within 2 hrs.
Within 4 hrs.
Same day 1 business day-10%
0%
10%
20%
30%
40%
50%
60%
Expected Actual
Q. What was the typical response time you expected from your agent to return any form of communication to you?
Q. On average, what was the actual response time of your agent to return any form of communication to you?
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%44%
Q. What was the typical response time you expected from your agent to return any form of communication to you?
More Buyers Expect Instant Response from Agents
Agent Satisfaction Ratings Decline- Average Ratings on 1-5 Scale -
2012 2013
Your real estate agent’s negotiating skills 3.4 3.2
Overall process of finding a home 3.4 3.2
Overall satisfaction with your real estate agent 3.4 3.1
Q. Please rate your degree of satisfaction with the following aspects of your home buying experience on a scale of 1-5, where 1 is “least satisfied” and 5 is “most satisfied”.
Buyer Satisfaction Continues Decline
2005 2006 2007 2008 2009 2010 2011 2012 20131
1.5
2
2.5
3
3.5
4
4.5
5
Process of Finding a Home Satisfaction with Agent
Q. Please rate your degree of satisfaction with the following aspects of your home buying experience on a scale of 1-5, where 1 is “least satisfied” and 5 is “most satisfied”.
Reasons for Satisfaction With Agent
Q. Why do you have that level of satisfaction with your agent?
Found best home (52%)
Worked hard (48%)
Quick to respond (37%)
Negotiated good deal (26%)
Listened to needs (19%)
Reasons for Dissatisfaction With Agent
Q. Why do you have that level of satisfaction with your agent?
Slow response (82%)
Ineffective/inefficient communication (48%)
Undesirable communication methods (43%)
Not aggressive in negotiation (47%)
Showed homes unlikely to buy (2%)
Fewer Buyers Certain they Would Work With the Same Agent Again
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
88% 87%
50%67% 61% 64% 72%
54% 60% 52%
2% 3%
4%
3% 15% 13%11%
11%12% 22%
10% 10%
46%30%
25% 22% 17%35% 28% 26%
Unsure No Yes
Q. Would you work with the same agent again?
Majority of Buyers Didn’t Rate their Agent,Yelp Was Most Popular Among those Who Did
No70%
7%
4%
4%4%
Q. Did you rate your agent on a public forum, like Yelp or Zillow?Q. (If so) On which platform did you rate your agent?
Buyers Need Most Agent Assistance in Price Negotiation
Find the right home
Determine affordability
Determine comps
Negotiate terms of sale
Price negotiation
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
39%
43%
61%
71%
86%
Q. In which part(s) of the transaction did you need the most assistance from your agent?
Advice to Agents from Buyers
Q. What advice would you give to real estate agents to improve the process or the level of service?
Respond faster (54%)
Communicate according to client preference (48%)
Gain better market direction understanding (34%)
Better communication (32%)
Be savvier about distressed properties (9%)
Have better understanding of interest rate direction (6%)
Negotiate better (6%)