One of the most useful research projects of the National Association of Realtors® (NAR) is the annual survey of homebuyers and sellers. The most recent version (Profile of Home Buyers and Sellers 2012) became available in November of this year. The information is based on answers to a 120-question survey mailed to a random sample of 93,502 consumers who purchased a home between July 2011 and June 2012. (Names and addresses were provided by Experian, a company that maintains an extensive database of recent homebuyers that is derived from county records.) After accounting for undeliverable surveys, there was a 9.1 percent response rate.
In 2012, first-time homebuyers constituted 39 percent of the market. That is up 2% from last year, but is still a big drop from 50% in 2010 and 47% in 2009. The difference is primarily explained by the cessation of government tax policies that were designed to stimulate home sales a few years ago. Also, even though mortgage rates have remained extremely low, the continuing tightening of lending standards has probably played a role.
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 79 percent of buyers said that they used the internet frequently during the search process, a little more than the 74% last year. In 2003 that number was only 42%.
Forty-one percent of buyers went to the internet as the first step in the home search process, up from thirty-five percent last year. 18% contacted a real estate agent first, and 8% began by driving through neighborhoods looking for homes for sale. 11% first went online to find out about the process.
Buyers use multiple sources of information in the process of looking for a home. Far and away the most used sources are the internet (90%) and real estate agents (87%). What is the third most used information source? Yard signs (53%).
Multiple Listing Service (MLS) websites were the primary source of information for buyers who used the internet in their search process. 54 percent of those buyers went to MLS sites. Of course, many went to a variety of different sites. 51 percent used Realtor®.com, 39% went to real estate company websites, and 47% went to sites hosted by individual agents. Aggregators such as Zillow, Homegain, and Yahoo were visited by 27% of buyers.
Despite all the hoopla about using social networking sites such as Facebook and Twitter, only 1% 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 the information source that was highest in that category (47%) was the internet. Agents are second at 33%. Note that this is not to say that buyers bought their home through the internet. The typical scenario would be that a consumer sees the home on the internet, and then contacts his or her agent.
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 9%, but this is the first time in the survey history that it has been lower than double digits. 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 2012, it was only 1%. Fewer than 1% found their home through a home book or magazine.
The 2012 Profile of Home Buyers and Sellers shows what works. It is a valuable resource.
Published: November 20, 2012
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