Tuesday, May 29, 2012

Homebuyer Survey

One of the most useful research projects of the National Association of Realtors® (NAR) is the annual survey of homebuyers and sellers. The 2011 version (Profile of Home Buyers and Sellers 2011) became available in May of this year. The information is based on answers to a questionnaire mailed to a random sample of 80,099 consumers who purchased a home between July 2010 and June 2011. (Names and addresses were provided by Experian, a company that maintains an extensive database of recent homebuyers that is derived from county records.) There was a 7.3 percent response rate. In 2011, first-time homebuyers constituted 37 percent of the market. That is the lowest in five years, and a big drop from 50% in 2010 and 47% in 2009. The drop in first-time homebuyers was accompanied, not surprisingly, by an increase in the median age of homebuyers: from 39 years of age in 2010 to 45 in 2011. This statistical evidence gives support to the wide-spread Realtor® concern, reported here just last week, that overly-tight lending standards along with severe property restrictions by FHA are having the effect of keeping younger and entry-level buyers out of the market Certainly the most useful information for sellers and their agents is to be found in the section on the home search process. While the survey results are not significantly different from those of recent years, the trends continue. For example, this year 75 percent of buyers said that they used the internet frequently during the search process, about the same as 74% last year. In 2003 that number was 42%. Thirty-five percent of buyers went to the internet as the first step in the home search process. 21% contacted a real estate agent first, and 8% began by driving through neighborhoods looking for homes for sale. Buyers use multiple sources of information in the process of looking for a home. Far and away the most used sources are the internet (88%) and real estate agents (87%). What is the third most used information source? Yard signs (55%). Multiple Listing Service (MLS) websites were the primary source of information for buyers who used the internet in their search process. 56 percent of those buyers went to MLS sites. Of course, many went to a variety of different sites. 45 percent used Realtor®.com, 40% went to real estate company websites, and 46% went to sites hosted by individual agents. Aggregators such as Zillow, Homegain, and Yahoo were visited by 38% of buyers. Despite all the hoopla about using social networking sites such as Facebook and Twitter, only 2% of buyers used them as a source of information about available properties; and only 1% used video hosting sites such as YouTube. While there are a lot of intriguing data about the sources of information used by prospective homebuyers, certainly the most relevant has to do with where they actually found the home that they ultimately purchased. This year, for the first time, the information source that was highest in that category (40%) was the internet. In previous years it had been a real estate agent. Agents are a very close second at 35%. The differences in a decade are fascinating. In 2001, 48 percent of buyers learned about their home through a real estate agent, and only 8 percent found their home on the internet. The times they have changed. Some things, though, remain persistently the same – or close to it. In 2001, a yard sign was the third most likely source of information leading to the home that was purchased (15%). And this year? It is still the third leading source at 11%, the same as last year. Print media may not be dead, but it has shrunk to insignificance in this arena. In 2001, 7% of homebuyers found the home they ultimately purchased through a newspaper ad; in 2011, as in 2010, it was less than 2%. Fewer than 1% found their home through a home book or magazine. The 2011Profile of Home Buyers and Sellers shows what works. It is a valuable resource. Published: Realty Times : May 29, 2012

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