Yesterday I showed you the portions of Gary Keller’s Vision Speech from the 2010 Keller Williams Family Reunion which focused on the U.S. housing market and economic trends.
Gary also spent time discussing the results of the National Association of Realtors (NAR) 2009 buyer/seller survey.
I’ve read the entire NAR report, and Gary did a great job of pulling out the most important information.
The slide show presentation (click on the picture below to see the slide show) helps you understand what motivates home buyers and sellers. The information is useful not only for real estate agents who make a living selling homes, but also for home sellers who need make sure the marketing of their home reaches as many buyers as possible.
Highlights:
Home Buyers:
- Over the last 10 years, almost half of the home buyers each year are first time buyers. The 2009 economy and incentives for first time buyers resulted in the highest percentage of 1st time buyers since 2001.
- 43% of buyers lived in their prior home for 5 years or less, but only 16% of them expected to live in their newly purchased home for 5 years or less.
- The largest group of buyers start the home search process by looking on the internet for homes and information. The next largest group of buyers contacts a real estate agent to get started.
- Home buyers are taking longer to select a home, with 2009 buyers averaging 12 weeks before they purchase.
- About 9 in 10 buyers are using the internet and a real estate agent to help them find a home.
- 3 in 4 buyer found the home they purchased through the internet or their real estate agent.
- Only 2% of buyers found their home from print advertising!
- The most important information to buyers when they look for homes on websites are pictures and detailed information about the house.
- The majority of buyers are searching for homes on sites that either offer an MLS search or all of the home listings in an area (including Realtor.com, agent and brokerage websites with home searches). My takeaway: in order to attract buyers to their website, agents MUST have an MLS search which provides a display which makes it easy to see large pictures and has detailed home information in a format that is easy to use!
- With 77% of buyers using an agent in their home sale, and another 10% buying through a foreclosure or trustee sale, there are only 1 in 10 buyers purchasing market rate homes and NOT using an agent.
- 46% of buyers say the most important thing they want from their agent is help finding the right home to purchase, and 29% primarily want help with negotiating price or terms of the sale.
- 44% of buyers found their agent from a referral. With social media becoming the new way of networking, it is going to be even more critical that agents master the skills of interacting online.
- With almost half of buyers stating reputation, honesty and trustworthiness being the most important factors in choosing an agent, the inevitable online rating systems of real estate agents will have a huge impact on the industry.
- The vast majority of home buyers would recommend or use their agent again. Agents need to keep in touch with their former clients!
Home Sellers:
- Though 88% of buyers said they would definitely or probably use their agent again, only 24% of sellers hired an agent they had used before. Let me repeat myself…agents need to keep in touch with their former clients!
- 2/3 of buyers and sellers only talk to one agent about their home purchase/sale. Agents need to keep in touch, and then be the first one to respond when a possible client expresses any interest in buying or selling!
- Only 1 in 5 sellers think the most important thing their agent can help with is pricing the home competitively. Agents need to be selective in which homes they choose to list, or they may spend a lot of time working for free.
- Just like home buyers, the most important factor to most sellers in choosing an agent is reputation, honesty and trustworthiness…online reviews are inevitable!
- The number of homes successfully selling by an owner without a listing agent (FSBO), has slightly dropped since 2001.
- While the median Sale Price to List Price ratio was 95%, about 1 in 4 sellers had to come down more than 10% in order to sell their home.
- Buyer incentives don’t sell homes. Buyers purchase the home with the best features for the location with the BEST PRICE.
Check back for Part 3 of the Vision Speech presentation – Full Service vs. MLS only Discount Brokerages.
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Lenders want to know that they will get their money back if they must foreclose on the property at some point in the future. If they think there is a good chance that the value will drop, then the lender is much less likely to agree to give out a loan.
