2012 HOME BUYER SURVEY
SURVEY
California Association of REALTORS® | 2012 Home Buyer Survey
Table of Contents
Introduction .................................................................... 3
Housing Market Environment ......................................... 3
Survey Methodology ....................................................... 3
Executive Summary......................................................... 4
Who is the 2012 Home Buyer? ....................................... 5
The Home ........................................................................ 9
Buying Experience ......................................................... 10
Internet Use .................................................................. 11
Financing ....................................................................... 12
Buyer and Agent Interaction ......................................... 14
Communication ............................................................. 14
Agent Satisfaction Ratings ............................................ 16
Key Conclusions ............................................................ 17
Opportunities ................................................................ 17
Bibliography .................................................................. 19
List of Exhibits ............................................................... 20
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California Association of REALTORS® | 2012 Home Buyer Survey
Introduction
The housing market continued to favor buyers in 2012 with
low prices and low mortgage rates. Those with good credit
scores and sizeable downpayments successfully became
home owners. The CALIFORNIA ASSOCIATION OF
REALTORS® (C.A.R.) 2012 Home Buyer Survey looked at
buyers in greater detail. The Survey covers home buyer
demographics, the types of homes purchased and
preferences, the details of the buying experience from the
buyer perspective, and many aspects concerning client and
real estate agent interaction.
Housing Market Environment
California home sales experienced their strongest October in four years. Sales of existing single family
homes increased 10.2 percent to 544,380 from 493,790 in October of last year. The sales level is the
largest year-over-year increase in three months. The growth in the housing market continued to be
fueled by strong sales in higher-priced segments of the market as supply shortages remained a
constraint on sales in the lower price segments.
The unsold invent tory index at 3.1 months was at the lowest level since August 2005. Sales growth in
the lower price segments continued to be limited by supply constraints in the $200,000 and under price
range, which dropped 19.6 percent from October last year. Markets in the higher price segments held
up much better with sales in the $300,000 to $400,000 category rising 23 percent year-over-year, sales
in the $400,000 to $500,000 range grew 21.4 percent over the same period, and sales in the over
$500,000 segment increased 33.9 percent year-over-year.
The statewide median price rose 23 percent to $341,370 from $277,450 in October 2011, continuing its
year-over-year increases for the eighth straight month and its double digit year-over-year gains for the
fourth consecutive month. The $341,370 median is 39.2 percent higher than the cyclical bottom of
$245,230 reached in February 2009. The increase in price was due to upward price pressure resulting
from the limited supply of inventory, as well as more demand of higher-priced homes. The combination
of these two factors led to the change in the mix of sales, which was the primary contributor to the jump
in the statewide median price.
Survey Methodology
The Survey was conducted by telephone to 800 people statewide to measure their perceptions of the
home-buying process. Eligible respondents all closed escrow on their new homes within the six months
prior to August 2012. Participants were selected on a random probability basis and the reported results
are subject to a maximum sampling error of +/- 3.5 percent (a 95 percent confidence level at two
standard deviations).
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California Association of REALTORS® | 2012 Home Buyer Survey
Executive Summary
The demographic composition of buyers is changing. Home buyers are getting younger; the average age
has declined from 44 in 2006 to 35 in 2012. Ethnic minorities now comprise two-thirds of the buying
population in California. Most have a college degree and an annual household income over $75,000.
Over half of buyers were renters and they spent more than three months on average considering the
purchase of a house before contacting a real estate agent. The average buyer investigates homes and
neighborhoods for longer than 2.5 months before getting in touch with an agent.
Attractively low home prices were the primary reason for buying. Also important to buyers are the
property tax and mortgage interest deductions.
Most buyers (80 percent) found their home through an agent, but the percentage who found their
home online is growing.
The average buyer searched for a home with an agent for two months and viewed about nine homes
before making a purchase.
Seven in 10 escrows do not close on time and this is reflected in the declining satisfaction with the home
finding process.
Despite some of the challenges in the market, most buyers (73 percent) are optimistic about the future
direction of home prices and believe that prices will rise in the next 10 years.
The internet is an important tool in the home buying process. Realtor.com and Zillow are the most
widely used and most useful websites among buyers. The majority of buyers even found the home they
ended up buying on those two sites.
Buyers are turning more to social media, with more than two-thirds using it in the buying process and
nearly all (90 percent) being receptive to receiving information in this format.
The majority of buyers obtained 30-year fixed rate loans to finance their purchases. While the average
buyer is putting about 25 percent down on a house, they are still having difficulty obtaining financing.
Nearly all buyers used an agent and most of those who did found their agent online. The average buyer
interviewed at least two agents before selecting the one with whom they would work.
When it comes to service from their agents, buyers want the most responsive and most aggressive agent
representing them. An agent’s reputation and experience are highly valued qualities to home buyers in
selecting their agent.
Communication is a key element of the agent and client relationship. The majority of buyers prefers
communicating with their agents by email and text message and expects a fast response time.
Buyers were most satisfied with agents who found the best home and worked hard; they were least
satisfied with those who responded too slowly and were ineffective, especially in communicating.
Most home buyers find ratings valuable in selecting an agent and are most likely to rate agents on a
public forum if they had a bad experience.
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California Association of REALTORS® | 2012 Home Buyer Survey
Who is the 2012 Home Buyer?
The demographic composition of buyers is changing. Most
are repeat buyers, younger, highly educated, and have
higher annual household incomes.
The percentage of female buyers rose again in 2012 to 53
percent, compared to 48 percent last year. However, this has
declined from 58 percent in 2007, the highest levels in the
history of the Survey. The decrease is likely due to women
being impacted more negatively by the recession. Females
now comprise the majority of college graduates, yet still face
wage gaps in the work place and under representation in
higher management. Not only did women lose 2.9 million
jobs during The Great Recession, but their median annual
incomes also fell. (The White House National Economic
Council, 2010)
The increase in the percentage of younger buyers continued this year. As Gen Y enters the work force in
greater numbers, so they will also enter the buying population. The average age has fallen every year
from 44 in 2006 to 35 in 2012. In fact, nearly half (47 percent) of all buyers are younger than 35,
compared to only 26 percent in 2004. The following table provides a more detailed breakdown of buyers
by age group from 2002 through 2012.
Exhibit 1: Age of Home Buyers
Under 25
25-34
35-44
45-54
55-64
65+
Refused
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
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California Association of REALTORS® | 2012 Home Buyer Survey
Minorities represent the majority of home buyers in California, making up 66 percent of all buyers. This
is the highest level since 2003, when minorities made up less than half (47 percent) of all buyers.
Hispanics and Asians each make up 26 percent of buyers, with African Americans making up 14 percent.
The percentage of Hispanic buyers grew from 16 percent in 2003 to 26 percent this year, and the
percentage of African American buyers grew by 11 percentage points over the same period to 14
percent this year, while the Caucasian percentage shrank from 53 percent in 2003 to 34 percent in 2012.
The percentage of single buyers has dramatically increased to 46 percent this year from 35 percent last
year and 14 percent in 2006, reflecting the changing demographics of the state and the gradual decline
in married households. Gen Y and Gen X are getting married at an older age on average and forming
households outside the traditional boundaries of the institution. According to the U.S. Census Bureau
2011 American Community Survey, only 46.5 percent of Californians are married, compared to 57
percent being married in 2000.
Home buyers are highly educated; 60 percent have a college or graduate degree and all buyers have at
least a high school diploma. In comparison to the State of California, where only 30 percent of the
population who is 25 years and over has a bachelor or graduate degree (U.S. Census Bureau, 2011),
buyers are more educated. This identifies a correlation between getting an education and
homeownership; those who are better educated, are more likely to own a home.
Exhibit 2: Home Buyer Education Level
15%
9%
17%
14%
45%
High School
Some College
Vocation/Technical
College Grad
Post Grad
Those who own a home have a higher income than the average Californian. Nearly all buyers (99
percent) have an annual household income over $75,000, whereas only about 26 percent of Californians
do. The discrepancy in six figure incomes is also large; two-thirds of buyers earn more than $100,000 a
year, but only 15.5 percent of Californians (U.S. Census Bureau, 2011) earn at that same level. There is a
strong link between owning a home, having a higher education and higher income.
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California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 3: Annual Household Income of Home Buyers
Under $50,000
$50-000-$74,999
$75,000-$99,999
$100,000-$149,999
$150,000-$199,999
$200,000 +
100%
80%
60%
40%
20%
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Over the past several years, as the chart above shows, the annual household income of buyers has been
fairly constant due to the recession. At the same time, mortgage interest and charges have been
decreasing (see Exhibit 4). With incomes unchanged and the cost of home ownership declining, it has
culminated in the ideal environment for qualified buyers.
Exhibit 4: Annual Mortgage Interest, Charges and Rent Expenditures
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California Association of REALTORS® | 2012 Home Buyer Survey
The percentage of first-time buyers has returned to 2002 levels of approximately 36 percent, a sizeable
decline from a 47 percent peak in 2009. This can be attributed to the sluggish economic recovery, an
increasingly challenging lending environment and competing all cash offers from investors. The
percentage of investors has remained strong at 16 percent, only one percent lower than the record high
of 17 percent last year. Repeat buyers still dominate, making up nearly two-thirds (64 percent) of all
buyers. (CALIFORNIA ASSOCIATION OF REALTORS(R))
Exhibit 5: C.A.R. 2012 Annual Housing Market Survey First-time vs. Repeat Buyers, and Investors
100%
90%
80%
70%
60%
50%
40%
47%
42%
39%
36%
36%
30%
31%
26%
31%
27%
30%
44%
36%
34%
36%
20%
10%
0%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
First-time
Repeat
Investor
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California Association of REALTORS® | 2012 Home Buyer Survey
The Home
The housing market has been turning around and 2012 is shaping up to be a transition year. The share of
non-distressed sales has increased to its highest point (63 percent) in over three years, when these
types of sales made up only about 30 percent of the market (in January 2009). This reflects a housing
industry returning back to healthier conditions. This is especially evident in the sharp drop in REO sales
from 60 percent in January 2009 to about 12 percent in September 2012.
Exhibit 6: Type of Sale
Equity Sales
Short Sale
REO
70%
63.0%
60%
50%
40%
30%
24.3%
20%
10%
12.3%
0%
Jan-09
Jun-09
Nov-09
Apr-10
Sep-10
Feb-11
Jul-11
Dec-11 May-12
More than three quarters of purchases (77 percent) are used as a primary residence, according to
C.A.R.’s 2012 Annual Housing Market Survey. The remaining 23 percent are either investment or second
or vacation homes, up from 16 percent in 2005. This increase in investment and second/vacation homes
reflects the growing role of investors in the real estate market.
Location is still very important to buyers, it is the most important factor in home purchasing for 49
percent of buyers, compared to getting “the deal” (referring to increased affordability) indicated by 29
percent of buyers, and home features indicated by 13 percent of buyers.
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California Association of REALTORS® | 2012 Home Buyer Survey
Buying Experience
Before they considered owning a home, most buyers (54 percent) were renters. Among first-time buyers
that percentage is even higher—84 percent. Moving from renting to home ownership is up from 48
percent last year, which is consistent with the declining rate of home ownership nationally—down 2.9
percent from the 2004 peak to 66.1 percent in 2012. (Harvard University Joint Center for Housing
Studies, 2012) Similarly in California, buyers who previously owned their home declined from 49 percent
in 2011 to 38 percent this year. Seven percent of buyers previously lived with their parents, up from
three percent last year, echoing the effects of the troubled economy.
The buying process began long before buyers actually contacted an agent. On average, buyers started
considering a purchase more than three months (12.2 weeks) before contacting a real estate agent.
Down from over four months (16.6 weeks) last year, earlier outreach to an agent is a sign of buyers’
desire to take advantage of low prices and low interest rates. As a result of more information being
available online now, buyers are also spending more time investigating homes and neighborhoods
before contacting an agent—6.5 weeks on average, compared to only three weeks in 2005.
When they were finally ready to make a purchase, nearly half (45 percent) indicated that price
decreases were their primary reason for buying. Other reasons for buying included a desire for a better
location and favorable prices and financing. Property tax and mortgage interest deductions were also
important to buyers; they rated the importance an average of 4.8 on a scale of one to five, with five
being extremely important.
About eight in 10 buyers found their home through an agent, down 10 percent from 2009. The
percentage of buyers finding their homes online has increased 10 percent from 2009 to 16 percent.
There is a trend in buyers turning more to the internet to find their homes, rather than using more
traditional methods, like an agent or a broker.
Exhibit 7: How Buyers Found Home
100%
4%
6%
1%
7%
4%
13%
16%
13%
80%
60%
40%
90%
85%
80%
20%
80%
0%
2009
2010
Agent
2011
Website
2012
Other
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California Association of REALTORS® | 2012 Home Buyer Survey
Those who worked with an agent spent a little longer than two months (nine weeks) on average looking
for the right home, up from eight weeks in 2011. They also viewed five fewer homes on average with
their agent this year, compared to viewing 15 homes on average in 2010. Consequently, buyers are less
satisfied with the home finding process, rating their satisfaction a 3.4 on a scale of one to five, with five
being extremely satisfied. Down from a rating of 4.5 in 2005, lower buyer satisfaction with the home
finding process is in part due to the decline in home inventory, which has resulted in bidding wars
among buyers, who also face competition from investors and those paying cash for properties.
While the real estate market is not out of rough waters yet, it is showing signs of improvement. One
such indication is the percentage of escrows closing on time—30 percent in 2012, up from 24 percent
last year. Another sign of improvement is the increased optimism of buyers regarding the future
direction of home prices. More buyers this year than in 2009 believe that prices will go up in one, five
and 10 years. Almost three quarters of buyers (73 percent) believe home prices will rise in 10 years,
compared to 60 percent of buyers who believed that in 2009. More importantly, none of the buyers who
responded to the survey this year felt that prices would drop in the future. This optimism is echoed by a
32.9-point increase in the consumer confidence index from 37.38 in January 2009 to 70.28 in September
of this year. (The Conference Board(R))
Exhibit 8: Buyers Who Think Home Prices Will Go Up
73%
60%
41%
25%
2012
2009
35%
8%
In 1 Year
In 5 Years
Internet Use
The internet is now a normal part of our daily routine, so it
is no surprise that it was an important tool to buyers in the
home buying process. Ninety-six percent of buyers used the
internet during the process, a significant rise from 28
percent in 2000, and 62 percent in 2005.
When it comes to specific online activities, previewing
homes is most important to buyers—they rated it at 8.9 on
In 10 Years
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California Association of REALTORS® | 2012 Home Buyer Survey
a scale of one to 10, with 10 being most important. Also important is identifying specific homes that
buyers wanted their agents to show them (7.5) and finding an agent (7.2). Exhibit 9 lists the ratings of
other buyer internet activities.
Exhibit 9: Average Rating of Home Buyer Internet Activities
Preview homes (via pictures, virtual tours,
maps, videos)
8.9
Identify specific homes you want your real
estate agent to show you
7.5
Find a specific real estate agent
7.2
Learn about specific neighborhoods
7.0
Find a real estate firm
6.1
Get information on home financing and
down payments
6.0
Realtor.com and Zillow are very popular among buyers. Realtor.com has been the most widely used
website by buyers since 2003, with 87 percent indicating that they used it in 2012. It is also the most
useful website, followed by Zillow and individual brokerage websites, which have consistently been
reported as the top three most useful websites by buyers since 2007. Additionally, more than half of all
buyers (54 percent) found their home on realtor.com or Zillow.
The use of social media in the buying process also gained some ground this year, with more than twothirds (68 percent) of buyers using it, compared to 52 percent who used it last year. Buyers primarily
used it for buying tips and suggestions from friends, neighborhood information from friends and to view
their agents’ Facebook pages. The use of social media as a form of communication is expected to grow
in the future, with 90 percent of buyers indicating they are receptive to receiving information about the
home buying process directly from their agent via social media.
Financing
While an overwhelming majority of buyers surveyed obtained financing for their home purchase (96
percent),1 the lending environment remains a challenge. On a scale of one to 10, with 10 being very
1
This survey sample is skewed more towards non-investor buyers.
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California Association of REALTORS® | 2012 Home Buyer Survey
difficult, buyers rated their difficulty in obtaining financing at 8.5 on average, up from 8.0 in 2011.
Higher downpayments are still the norm in this market, with buyers putting an average of 25 percent
down on their purchases. The average downpayment has been higher than the traditional 20 percent
since 2009.
As the market gets back to basics, we have seen fixed rate loans being obtained by 24 percent more
buyers than in 2009, when only 69 percent had a fixed rate loan and 31 percent had an adjustable rate.
Furthermore, nearly nine out of 10 buyers (87 percent) have 30-year loan terms, and only 13 percent of
buyers have terms under 30 years.
Exhibit 10: Loan Type
Fixed
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
31%
69%
2009
6%
15%
79%
2010
Adjustable
Other
16%
84%
2011
7%
93%
2012
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California Association of REALTORS® | 2012 Home Buyer Survey
Buyer and Agent Interaction
A greater percentage of buyers (96 percent) used an agent in 2012 than any other year in the survey’s
history. This increase in the utilization of a real estate professional likely reflects the need for assistance
in navigating a challenging real estate market. Two-thirds of those who used an agent found their agent
online, compared to only 39 percent finding their agent online in 2002. Growing internet use to find an
agent shows the increasing importance of the web as an indispensable tool in the home buying process.
Despite nearly all buyers using an agent, agents must still compete for buyers’ business, as more than
seven out of 10 buyers interviewed at least two agents before selecting the one they would use to
purchase their home.
When it comes to selecting an agent, response time is important to buyers, along with being aggressive
and able to negotiate. Reputation is also important to home buyers in selecting an agent; buyers rated
the importance of reputation a 4.3 on a scale of one to five, with five being extremely important. Other
agent characteristics were rated and can be seen in the diagram below. The importance of reputation is
echoed by the fact that 59 percent more buyers now Google their agents than did so in 2007.
Communication
Communication is a key component of any business relationship and the agent-buyer relationship is no
different. While agents met expectations for the most part in email and in-person communication, there
is room for improvement in communication by telephone and text message. Only 14 percent of buyers
prefer to communicate with their agents by telephone, yet they reported that 44 percent of agents
communicated by telephone. There is a similar gap in text message communication; 32 percent of
buyers claimed they prefer this method of communication, but only five percent of agents
communicated by text message.
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California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 11: Preferred vs. Actual Communication
52%
44%
50%
32%
Preferred
14%
Actual
5%
2%
Telephone
0%
Email
Text Message
In Person
Clients are more demanding when it comes to response time expectations. The percentage of buyers
who expect an instant response from their agents has more than quadrupled from 10 percent in 2007 to
42 percent this year. Little less than half of buyers (48 percent) felt that agents met their response time
expectations. The graph below outlines the expected and actual response time.
Exhibit 12: Expected vs. Actual Response Time
Expected
Actual
60%
50%
19%
40%
7%
30%
20%
42%
4%
32%
27%
12%
19%
10%
6%
5%
0%
Instantly
Within 30
mins.
Within 1
hr.
Within 2
hrs.
Within 4
hrs.
20%
1%
5%
0%
Same day 1 business
day
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California Association of REALTORS® | 2012 Home Buyer Survey
Agent Satisfaction Ratings
Buyer satisfaction with their agent has remained unchanged for the past three years—3.4 on a scale of
one to five, with five being most satisfied. The agent satisfaction rating dipped below four points for the
first time in 2008, in sync with the beginning of a challenging real estate market. The top five reasons for
this level of satisfaction with the agent and the percentage of buyers who mentioned them are as
follows:
1.
2.
3.
4.
5.
Found the best home (58 percent)
Worked hard (53 percent)
Quick to respond (40 percent)
Negotiated good deal (29 percent)
Listened to needs (21 percent)
Buyer satisfaction with the process of finding a home has followed a similar pattern since 2005. In all the
categories they were asked to rate, buyers rated referrals from their agent and value received for what
they paid the agent the highest (3.5). These higher levels of satisfaction with agent referrals and value
received are also reflected in the increase in the percentage of buyers who would work with the same
agent again from 54 percent last year to 60 percent this year. Exhibit 13 provides a summary of the
average rating for all categories.
Exhibit 13: Home Buyer Ratings of Various Aspects of Buying Process
2011 2012
Value received for what you paid your real estate agent
3.6
3.5
Professional referrals your agent provided (i.e. lender, inspector, etc) 3.1
3.5
Overall process of finding a home
3.6
3.4
Overall satisfaction with your real estate agent
3.4
3.4
Your real estate agent’s negotiating skills
3.2
3.4
Assistance your real estate agent provided in searching for a home
3.4
3.3
Information on housing market conditions that your agent provided
3.3
3.1
Buyers are increasingly finding agent ratings on public forums beneficial. In 2012, 82 percent indicated
that they would find agent ratings at least somewhat beneficial, compared to 80 percent in 2011. Most
buyers did not rate their agent on a public forum. The 19 percent who did rate their agent used Yelp,
Zillow, Yahoo Real Estate or Redfin. Predictably, clients admitted (at a ratio of almost two to one) that
they were more likely to rate their agent if they had a bad experience.
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California Association of REALTORS® | 2012 Home Buyer Survey
Key Conclusions
To conclude the Survey, we asked buyers to give their agents some advice to improve the home buying
process or level of service. Here is what they revealed:







Communicate according to client preference (50 percent)
Gain a better understanding of the direction of the real estate market (45 percent)
Be more savvy about handling distressed properties (44 percent)
Respond faster (43 percent)
Have a better understanding of the direction of interest rates (nine percent)
Provide more assistance with mortgage approval (six percent)
Negotiate better (three percent)
The Survey revealed that the internet is an increasingly important tool for buyers in the home buying
process. Buyers are doing a lot of research online about homes, neighborhoods, properties, agents,
financing and more. Consequently, it is imperative for real estate professionals to have a strong web
presence and to maintain a good reputation, especially with a greater percentage of buyers reviewing
agent ratings on public forums.
Customer service is crucial in any business, but especially in service-oriented industries, like real estate.
As Walt Disney said, “Do what you do so well that they will want to see it again and bring their friends.”
The best way to provide clients with excellent customer service is to focus on their reasons for selecting
and being satisfied with their agents. Equally important is avoiding the key pitfalls, such as slow
response, ineffective/inefficient communication, undesirable communication methods, not being
aggressive in negotiating, and showing homes in which the buyer is not interested.
Opportunities
In addition to providing a better understanding of home buyers, this Survey offers ways that agents can
improve their business.
2/3 of buyers
found their
agent online
market your
business
online
Because realtor.com and Zillow are the most popular and most useful websites among buyers, it would
be beneficial for REALTORS® to center their internet marketing efforts on these websites.
Social media use will continue to grow in the real estate business, as nine out of every 10 buyers are
receptive to receiving information about the home buying process directly from their agent via social
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California Association of REALTORS® | 2012 Home Buyer Survey
media, but only 68 percent used it. Therefore, it would
be useful to devise a strategy for incorporating social
media into the business marketing plan.
Effective marketing is key to getting the most bang for
your buck, not only in terms of the various marketing
methods available and the appropriate target audience,
but also in terms of content. When marketing yourself
and your brand, highlight the qualities that matter most
to buyers, like a fast response to inquiries, being
aggressive on the client’s behalf, experience and
negotiation skills. When marketing properties, focus on the reasons that buyers made a purchase, such
as price decreases, desire for better location and investment/tax advantages. Also, be sure to highlight
the things they value the most in viewing homes--photos, videos and statistics on comparable homes.
With clients being so demographically diverse, it is not always easy to communicate effectively, but this
is crucial to delivering top notch customer service. Communicate more effectively with clients by asking
them their preferred method of communication and using that method.
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California Association of REALTORS® | 2012 Home Buyer Survey
Bibliography
CALIFORNIA ASSOCIATION OF REALTORS(R). (n.d.). 2012 Annual Housing Market Survey.
Harvard University Joint Center for Housing Studies. (2012). The State of the Nation's Housing.
The Conference Board(R). (n.d.). US Consumer Confidence Index. Retrieved October 2012
The White House National Economic Council. (2010, October). Jobs and Economic Security for America's
Women. Retrieved October 15, 2012, from The White House:
http://www.whitehouse.gov/sites/default/files/Jobs-and-Ecomomic-Security-for-AmericasWomen.pdf
U.S. Census Bureau. (2011). 2011 American Community Survey.
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California Association of REALTORS® | 2012 Home Buyer Survey
List of Exhibits
Exhibit 1: Age of Home Buyers...................................................................................................................... 5
Exhibit 2: Home Buyer Education Level ........................................................................................................ 6
Exhibit 3: Annual Household Income of Home Buyers ................................................................................. 7
Exhibit 4: Annual Mortgage Interest, Charges and Rent Expenditures ....................................................... 7
Exhibit 5: C.A.R. 2012 Annual Housing Market Survey First-time vs. Repeat Buyers, and Investors ........... 8
Exhibit 6: Type of Sale ................................................................................................................................... 9
Exhibit 7: How Buyers Found Home ........................................................................................................... 10
Exhibit 8: Buyers Who Think Home Prices Will Go Up ................................................................................ 11
Exhibit 9: Average Rating of Home Buyer Internet Activities ..................................................................... 12
Exhibit 10: Loan Type .................................................................................................................................. 13
Exhibit 11: Preferred vs. Actual Communication ........................................................................................ 15
Exhibit 12: Expected vs. Actual Response Time .......................................................................................... 15
Exhibit 13: Home Buyer Ratings of Various Aspects of Buying Process...................................................... 16
Exhibit 14: Typical 2012 California Buyer.................................................................................................... 23
Exhibit 15: Buyer Gender ............................................................................................................................ 23
Exhibit 16: Age ............................................................................................................................................ 24
Exhibit 17: Average Age .............................................................................................................................. 24
Exhibit 18: Ethnicity .................................................................................................................................... 25
Exhibit 19: Ethnic Background .................................................................................................................... 25
Exhibit 20: Marital Status ............................................................................................................................ 26
Exhibit 21: Education Level ......................................................................................................................... 26
Exhibit 22: Annual Household Income ........................................................................................................ 27
Exhibit 23: Geographical Distribution of Purchases.................................................................................... 27
Exhibit 24: What is Most Important to Buyers ........................................................................................... 28
Exhibit 25: What is More Important to Buyers ........................................................................................... 28
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California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 26: Living Arrangement Before Purchase ....................................................................................... 29
Exhibit 27: Time Spent Considering Purchase before Contacting Agent .................................................... 29
Exhibit 28: Time Spent Considering Buying Before Contacting Agent ........................................................ 30
Exhibit 29: Time Spent Investigating Homes & Neighborhoods before Contacting an Agent ................... 30
Exhibit 30: Time Spent Investigating Homes & Neighborhoods before Contacting Agent ........................ 31
Exhibit 31: Primary Reason for Buying........................................................................................................ 31
Exhibit 32: Importance of Property Tax & Mortgage Interest Deductions ................................................. 32
Exhibit 33: Importance of Deductions in Buying Decision .......................................................................... 32
Exhibit 34: Length of Home Search with Agent .......................................................................................... 33
Exhibit 35: Home Search Length ................................................................................................................. 33
Exhibit 36: Number of Homes Viewed Before Buying ................................................................................ 34
Exhibit 37: Average Number of Homes Viewed with Agent ....................................................................... 34
Exhibit 38: Percentage of Escrows Closing on Time ................................................................................... 35
Exhibit 39: Buyer Satisfaction with Home Finding Process ......................................................................... 35
Exhibit 40: What Buyers Would Change About the Home Buying Experience ........................................... 36
Exhibit 41: Buyer View of Direction of Future Home Prices ....................................................................... 36
Exhibit 42: Top 3 Most Widely Used Websites by Buyers .......................................................................... 37
Exhibit 43: Most Useful Websites in Buying Process .................................................................................. 37
Exhibit 44: Top 3 Most Useful Websites ..................................................................................................... 38
Exhibit 45: Websites Where Buyers Found Home ...................................................................................... 38
Exhibit 46: Top 3 Websites Where Buyers Found their Home ................................................................... 39
Exhibit 47: Most Important Features to Buyers in Online Home Viewing.................................................. 39
Exhibit 48: Social Media Use ....................................................................................................................... 40
Exhibit 49: How Social Media Was Used..................................................................................................... 40
Exhibit 50: Percentage of Buyers Receptive to Receiving Information via Social Media ........................... 41
21
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 51: Buyer Receptiveness to Receiving Information via Social Media ............................................. 41
Exhibit 52: Percentage of Buyers who Obtained Financing ........................................................................ 42
Exhibit 53: Buyer Degree of Difficulty in Obtaining Financing .................................................................... 42
Exhibit 54: Average Difficulty Obtaining Financing ..................................................................................... 43
Exhibit 55: Average Downpayment (as Percentage of Purchase Price)...................................................... 43
Exhibit 56: Length of Loan Term ................................................................................................................. 44
Exhibit 57: Percentage of Buyers who used an Agent ................................................................................ 44
Exhibit 58: How Buyers Found their Agent ................................................................................................. 45
Exhibit 59: Number of Agents Interviewed................................................................................................. 45
Exhibit 60: Average Number of Agents Interviewed .................................................................................. 46
Exhibit 61: What is Most Important to Buyers in Selecting an Agent......................................................... 46
Exhibit 62: Rating of Agent Characteristics ................................................................................................. 47
Exhibit 63: Percentage of Buyers who Googled their Agent....................................................................... 47
Exhibit 64: Percentage of Buyers Expecting Instant Response from Agent................................................ 48
Exhibit 65: Percentage of Agents who Met Buyer Response Time Expectations ....................................... 48
Exhibit 66: Rating of Response Time Expectations ..................................................................................... 49
Exhibit 67: Average Buyer Satisfaction Rating ............................................................................................ 49
Exhibit 68: Percentage of Buyers who would Work with the Same Agent Again ....................................... 50
Exhibit 69: Percentage of Buyers who would Find Agent Ratings Beneficial ............................................. 50
Exhibit 70: Percentage of Buyers who Rated Agents .................................................................................. 51
Exhibit 71: Buyer Likelihood of Rating Agent on Public Forum .................................................................. 51
22
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 14: Typical 2012 California Buyer
65%
minority
36% 1st time
buyers
35 years old
53%
female
99%
household
income >
$75k
54% single
60% college
/ graduate
degree
Exhibit 15: Buyer Gender
Male
Female
100%
90%
80%
70%
57%
58%
56%
58%
59%
64%
62%
61%
36%
36%
38%
39%
43%
42%
44%
42%
41%
2002
2003
2004
2005
2006
2007
2008
2009
2010
64%
48%
53%
52%
47%
2011
2012
60%
50%
40%
30%
20%
10%
0%
23
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 16: Age
55-64 (18%)
< 25 (3%)
45-54 (20%)
25-34 (22%)
35-44 (21%)
Exhibit 17: Average Age
50
45
40
35
30
25
20
15
10
5
0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
24
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 18: Ethnicity
Korean 5%
Filipino 3%
Chinese 5%
Other Asian 6%
White 34%
Indian 7%
Black 14%
Hispanic 26%
Exhibit 19: Ethnic Background
White
Black
Asian/Pacific Islander
Hispanic
Other
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
CA*
25
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 20: Marital Status
Married
Single
100%
90%
80%
46%
70%
60%
50%
40%
30%
54%
20%
10%
0%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Exhibit 21: Education Level
High School
Some College
Vocation/Technical
College Grad
100%
80%
60%
40%
20%
0%
2002 2003
2004 2005
2006 2007
2008 2009
2010 2011
2012
Post Grad
26
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 22: Annual Household Income
1%
$50-000-$74,999
13%
33%
$75,000-$99,999
18%
$100,000-$149,999
35%
$150,000-$199,999
$200,000 +
Exhibit 23: Geographical Distribution of Purchases
SoCal
NorCal
Other CA
70%
60%
50%
40%
30%
20%
10%
0%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
27
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 24: What is Most Important to Buyers
The Neighborhood
49%
"The Deal" (affordable price)
Home Features
Neighborhood + Home Features
29%
13%
9%
Exhibit 25: What is More Important to Buyers
"The deal"
Home features
Neighborhood
Neighborhood & home features equally important
100%
90%
34%
29%
80%
13%
70%
60%
50%
41%
40%
49%
30%
20%
25%
9%
10%
0%
2011
2012
28
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 26: Living Arrangement before Purchase
Owned
Rented
Lived with parents
Other
2%
3%
7%
100%
90%
48%
80%
54%
70%
60%
50%
40%
49%
30%
38%
20%
10%
0%
2011
2012
Exhibit 27: Time Spent Considering Purchase before Contacting Agent
7%
36+ Weeks
16-24 Weeks
18%
8-12 Weeks
34%
3-7 Weeks
37%
10%
2 Weeks Or Less
0%
5%
10%
15%
20%
25%
30%
35%
40%
29
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 28: Time Spent Considering Buying before Contacting Agent
16.6
12.2
8.4
8.6
2009
2010
7.2
5.6
3.9
3.9
4.0
3.8
3.8
2002
2003
2004
2005
2006
2007
2008
2011
2012
Exhibit 29: Time Spent Investigating Homes & Neighborhoods before Contacting an Agent
16+ weeks
3%
8-12 weeks
31%
3-7 weeks
60%
2 weeks or less
6%
0%
10%
20%
30%
40%
50%
60%
70%
30
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 30: Time Spent Investigating Homes & Neighborhoods before Contacting Agent
6.6
6.8
6.2
6.2
6.5
5.4
3.9
3.0
2002
2003
3.2
2004
3.0
3.1
2005
2006
2007
2008
2009
2010
Exhibit 31: Primary Reason for Buying
Price decreases
45%
Desired better/other location
12%
Favorable price/financing
11%
Investment/Tax advantage
8%
Promotion/raise
8%
Tired of renting
7%
Desired larger home
7%
Change in family
Changed jobs/Relocated
2%
1%
2011
2012
31
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 32: Importance of Property Tax & Mortgage Interest Deductions
79%
20%
1%
3
4
5
Somewhat
Important
Extremely
Important
Exhibit 33: Importance of Deductions in Buying Decision
Mean
4.8
4.8
5
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
2011
2012
32
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 34: Length of Home Search with Agent
54%
35%
10%
1%
2 Weeks Or Less
3-7 Weeks
8-12 Weeks
16-24 Weeks
Exhibit 35: Home Search Length
Median Weeks
12
10
8
6
4
2
0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
33
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 36: Number of Homes Viewed Before Buying
46%
24%
20%
8%
2%
1-5
6-10
11-15
16-20
21-25
Number of Homes
Exhibit 37: Average Number of Homes Viewed with Agent
15
15
14
14
12
11
11
10
10
10
9
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
34
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 38: Percentage of Escrows Closing on Time
Yes
No
100%
90%
80%
45%
70%
52%
56%
63%
66%
76%
60%
70%
50%
40%
30%
55%
20%
48%
44%
37%
34%
24%
10%
30%
0%
2006
2007
2008
2009
2010
2011
2012
Exhibit 39: Buyer Satisfaction with Home Finding Process
5
4.5
4
3.5
3
2.5
2
1.5
1
2005
2006
2007
2008
2009
2010
2011
2012
35
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 40: What Buyers Would Change About the Home Buying Experience
1. Agent negotiate better (26%)
2. Better agent communication (24%)
3. Better market direction understanding (20%)
4. Faster agent response (18%)
5. Escrow close on time (9%)
Exhibit 41: Buyer View of Direction of Future Home Prices
1 Year
5 Years
10 Years
Up
25%
41%
73%
Flat
49%
35%
20%
Unsure
27%
23%
7%
36
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 42: Top 3 Most Widely Used Websites by Buyers
Zillow
realtor.com
RE co.
Google
Agent
1
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Exhibit 43: Most Useful Websites in Buying Process
24%
23%
20%
19%
8%
6%
0%
5%
10%
15%
20%
25%
30%
37
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 44: Top 3 Most Useful Websites
Zillow
realtor.com
Brokerage
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2007
2008
2009
2010
2011
2012
Exhibit 45: Websites Where Buyers Found Home
28%
26%
17%
10%
6%
6%
5%
3%
0%
5%
10%
15%
20%
25%
30%
38
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 46: Top 3 Websites Where Buyers Found their Home
Agent
realtor.com
Brokerage
Zillow
Trulia
35%
30%
25%
20%
15%
10%
5%
0%
2011
2012
Exhibit 47: Most Important Features to Buyers in Online Home Viewing
Multiple pictures or Slide show
4.4
Virtual tour or Videos
4.3
Statistics on comparable home sales/listings
3.9
Neighborhood profile
3.7
Automatic notification of new listings available
3.7
Commentary & analysis of housing market
conditions
3.5
39
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 48: Social Media Use
70%
68%
60%
52%
50%
40%
30%
20%
10%
0%
2011
2012
Exhibit 49: How Social Media Was Used
51%
Buying tips, suggestions from friends
50%
Neighborhood info from friends
47%
Agent's Facebook page
35%
Neighborhood amenities
33%
Agent referrals
29%
Neighborhood lifestlye
0%
10%
20%
30%
40%
50%
60%
40
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 50: Percentage of Buyers Receptive to Receiving Information via Social Media
Average Rating = 4.1
48%
22%
21%
3
4
10%
2
5
Extremely
Receptive
Not Interested
Exhibit 51: Buyer Receptiveness to Receiving Information via Social Media
Average on 1-5 Scale
5.0
4.5
4.2
4.0
4.1
3.5
3.0
2.5
2.0
1.5
1.0
2011
2012
41
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 52: Percentage of Buyers who Obtained Financing
2
100%
100%
94%
92%
2010
2011
96%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2009
2012
Exhibit 53: Buyer Degree of Difficulty in Obtaining Financing
Average
10.0
8.1
8.5
8.0
8.0
8.5
6.0
4.0
2.0
0.0
2009
2
2010
2011
2012
Survey sample is skewed towards traditional buyers; most investors are not represented.
42
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 54: Average Difficulty Obtaining Financing
2009
2010
2011
2012
40%
35%
30%
25%
20%
15%
10%
5%
0%
1
2
3
4
5
6
7
8
9
10
Exhibit 55: Average Downpayment (as Percentage of Purchase Price)
35%
30%
25%
20%
15%
10%
5%
0%
2009
2010
2011
2012
43
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 56: Length of Loan Term
< 30 Year
100%
30 Year
15%
13%
80%
60%
85%
87%
40%
20%
0%
2011
2012
Exhibit 57: Percentage of Buyers who used an Agent
100%
96%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
44
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 58: How Buyers Found their Agent
Relationships/Contacts
Advertising
Internet
Other
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2002 2003
2004 2005
2006 2007
2008 2009
2010 2011
2012
Exhibit 59: Number of Agents Interviewed
38%
40%
30%
35%
30%
25%
18%
20%
15%
15%
10%
5%
0%
1
2
3
Number of Agents Interviewed
4
45
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 60: Average Number of Agents Interviewed
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2003
2004
2005
2006
2007
2008
2009
2010
2011
Exhibit 61: What is Most Important to Buyers in Selecting an Agent
Most reponsive
21%
Most aggressive
19%
1st to respond
17%
Negotiating ability
14%
Distressed property knowledge
12%
Previous relationship
6%
Most knowledgeable
6%
Most qualified
5%
2012
46
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 62: Rating of Agent Characteristics
Average Rating on 1-5 Scale
Reputation
4.3
Experience
4.2
Response time
4.2
Market share in neighborhood
where you wish to purchase
3.9
Social media presence
3.5
Exhibit 63: Percentage of Buyers who Googled their Agent
70%
60%
50%
40%
30%
20%
10%
0%
2007
2008
2009
2010
2011
2012
47
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 64: Percentage of Buyers Expecting Instant Response from Agent
50%
42%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2003
2004
2005
2006
2007
2008
2009
2010
2011
Exhibit 65: Percentage of Agents who Met Buyer Response Time Expectations
40%
39%
40%
35%
30%
25%
20%
12%
15%
10%
6%
3%
5%
0%
1 - Fell way
below
expectations
2 - Didn’t meet
expectations
3 - Somewhat
met
expectations
4 - Met
expectations
5 - Exceedingly
surpassed
expectations
2012
48
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 66: Rating of Response Time Expectations
Average on 1-5 Scale
4.0
3.6
3.5
3.3
3.3
3.3
3.1
3.1
3.0
2.6
2.5
2.5
2.0
1.5
1.0
0.5
0.0
2005
2006
2007
2008
2009
2010
2011
2012
Exhibit 67: Average Buyer Satisfaction Rating
Process of Finding a Home
Satisfaction with Agent
5
4.5
4
3.5
3
2.5
2
1.5
1
2005
2006
2007
2008
2009
2010
2011
2012
49
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 68: Percentage of Buyers who would Work with the Same Agent Again
Unsure
10%
2%
10%
3%
No
Yes
25%
17%
22%
30%
11%
46%
3%
35%
13%
15%
28%
12%
11%
4%
88%
87%
67%
50%
2004
2005
2006
2007
61%
64%
2008
2009
72%
54%
2010
2011
60%
2012
Exhibit 69: Percentage of Buyers who would Find Agent Ratings Beneficial
Very beneficial
100%
90%
80%
Beneficial
Somewhat beneficial
Not beneficial
5%
10%
15%
8%
21%
18%
70%
60%
50%
24%
31%
40%
30%
20%
40%
28%
10%
0%
2011
2012
Unsure
50
California Association of REALTORS® | 2012 Home Buyer Survey
Exhibit 70: Percentage of Buyers who Rated Agents
7%
No
81%
Yes
19%
4%
4%
4%
Exhibit 71: Buyer Likelihood of Rating Agent on Public Forum
If good experience
37%
If bad experience
63%
51
California Association of REALTORS® | 2012 Home Buyer Survey
52
California Association of REALTORS® | 2012 Home Buyer Survey
Leading the way…® in California real estate for more than 100 years,
the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of
the largest state trade organizations in the United States with
155,000 members dedicated to the advancement of professionalism
in real estate. C.A.R. is headquartered in Los Angeles.
The Association develops and promotes programs and services that
will enhance the members' freedom and ability to conduct their
individual businesses successfully with integrity and competency and,
through collective action, promotes the preservation of real property
rights.
CALIFORNIA ASSOCIATION OF REALTORS®
Research and Economics
525 South Virgil Avenue
Los Angeles, CA 90020-1403
213.739.8200
[email protected]
http://www.car.org/marketdata/
53