2012 Survey of California Home Buyers

Understanding todays home buyerPresented by

Carmen Hirciag, MBASenior Research Analyst

1Survey Methodology1,400 telephone interviewsconducted in February 2014 home buyers who purchased Aug. 2013 Jan. 20142WHO IS the 2014 buyer?DemographicsTypical CA Home Buyer4Average Age: 48Q. What is your age?5Buyer Age Continues RisingQ. What is your age?6Younger Buyers Continue to DeclineQ. What is your age?7Housing Affordability Index8Housing Affordability (State) Peak vs. Current9Minimum Annual Income Required Peak vs. CurrentBy Counties, 2014 Q1 vs. 2012 Q1

SERIES: Housing Affordability Index of Existing Detached HomesSOURCE: CALIFORNIA ASSOCIATION OF REALTORS 10Percent of First-time Buyers Continues DeclineQ. Was this your first home purchase?11Minorities are the MajorityQ. How would you describe your ethnic background?12Majority of Buyers are MarriedMarried Buyers on the DeclineQ. What is your marital status?14More than Half of Buyers have College DegreesQ. What is the highest level of education you have completed?157/10 Buyers have Annual Household Income > $100KQ. Which of the following categories best represents you total annual income from all sources? 16Buyers Annual Household Income RisesQ. Which of the following categories best represents you total annual income from all sources? 17Fewer Repeat Buyers Previously Under WaterQ. Was the outstanding loan balance on your previous home higher than the sale price?18The Buying experienceListing Price Rises 7%Q. What was the initial listing price of the home you purchased?Median Purchase Price Rises 25% YTYQ. What was the price of the home you purchased?21Purchase PriceQ. What was the price of the home you purchased?22Purchase/Listing Prices Nearly EqualQ. What was the price of the home you purchased?23Median Distance from Previous Residence: 15 MilesQ. How many miles away was your previous residence from the home you bought?24Buyers Staying Closer to Previous ResidenceQ. How many miles away was your previous residence from the home you bought?25Nearly 6/10 Buyers Were Previous Home OwnersQ. What was the living arrangement immediately before your recent home purchase?26More Buyers Owned Previous ResidenceQ. What was the living arrangement immediately before your recent home purchase?27Buyers Spending Less Time than Last Year Considering Purchase Before Contacting AgentQ. How many weeks did you consider buying a home before contacting a real estate agent? (Asked if agent was used)Average Weeks28Buyers Spending Less Time than Last Year Investigating Homes & Neighborhoods Before Contacting AgentQ. How many weeks did you spend investigating homes and neighborhoods before contacting a real estate agent? (Asked if agent was used)Average Weeks29The Home Search is Getting LengthierQ. Once you found your agent, about how many weeks did you spend looking for a home with your agent? (Asked if agent was used)30All Buyers Viewed at Least 10 Homes Before BuyingQ. How many different homes did you preview and visit with your agent prior to making a purchase?31Increase in Homes Viewed Reflects Inventory ImprovementQ. How many different homes did you preview and visit with your agent prior to making a purchase?Median3291% of Buyers Made Offers on Other HomesQ. How many offers did you make on other homes? 33Buyers Made More Offers on Other HomesQ. How many offers did you make on other homes? 34Price Decreases are Main Reason for BuyingQ. What were your main reasons for buying your home?35Buyers Didnt Purchase Sooner BecauseQ. Why didnt you buy a home sooner?Nearly Half of Buyers Settled on Best Available HomeQ. Are you satisfied with the home you purchased or do you feel like you selected the best option given the limited supply of homes? More Buyers Settled on Best Available HomeQ. Are you satisfied with the home you purchased or do you feel like you selected the best option given the limited supply of homes? 38Most Buyers Found Home through AgentQ. How did you find the home you purchased?39More Buyers are Finding Homes OnlineQ. How did you find the home you purchased?40Most Homes Were Listed on MLSQ. Was the home you purchased listed on a multiple listing service?Fewer Homes Were Listed on MLSQ. Was the home you purchased listed on a multiple listing service?42Buyers Plan to Keep Homes LongerQ. How long do you plan to keep the property?Buyers Optimistic About Long Term Direction of Home PricesQ Do you think home prices in the neighborhood where you purchased will go up, down, or stay flat in one year, in five years?More Buyers Believe Prices Will RiseQ Do you think home prices in the neighborhood where you purchased will go up in one year, in five years?45

Internet UseMore Buyers Using MobileQ. Did you use a mobile device in the home buying process? 91% of Buyers Used Mobile Device in Buying ProcessQ. How did you use your mobile device in the home buying process? N = 1269Zillow is Most Useful AppQ. What was the most useful app that you used during the home buying process? N = 1269

49Realtor.com & Zillow are Most Useful Websites in Buying ProcessQ. What was the single most useful website that you visited during your home buying process?

BrokerageAgent

50Realtor.com & Zillow Most Useful WebsitesQ. What was the single most useful website that you visited during your home buying process?51Most Buyers Found Home on Realtor.com or Zillow

Q. On which website did you find your home?

52Realtor.com & Zillow Helped Most Buyers Find HomesQ. On which website did you find your home?53Social Media Use Continues RisingQ. Did you use social media (such as Facebook, Twitter, YouTube, etc.) in your home buying process?5477% of Buyers Used Social Media in Buying Process

Q. Which social media websites did you use during your home buying process? N = 107355Social Media Used for Buying Tips & Neighborhood InfoQ. How did you use social media (such as Facebook, Twitter, YouTube, etc.) in your home buying process? N = 107392% of Buyers are Receptive to Receiving Information via Social MediaQ. 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)Fewer Buyers Google their AgentQ. Did you Google your agent? 58Internet Info as Useful as Agent InfoQ. How would you compare the information you gathered on the Internet to the information provided by your real estate agent?N = 1238

FinancingFewer Buyers Obtained FinancingQ. Did you obtain financing for your home purchase?More than Buyers Paid CashQ. How did you pay for the home you purchased?Most Cash Buyers Used Proceeds from Previous ResidenceQ. If all cash, where did the funds come from? N = 367Average Down Payment Remains Above 20%Q. What was your down payment for the home purchased, in percent of the home value?64Most Buyers Obtain Fixed Rate LoansQ. What type of loan do you have?65Fixed Rate Loans Remain MajorityQ. What type of loan do you have?6685% of Loans are for 30 YearsQ. What was the duration of your loan?67Buyers Have Less Difficulty With FinancingQ. 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.682/3 Buyers Did Not Have Appraisal ProblemsQ. What, if any, problems did you have with the home appraisal when attempting to obtain financing?More Buyers Had Appraisal ProblemsQ. What, if any, problems did you have with the home appraisal when attempting to obtain financing?70Buyer/Agent relationshipFewer Buyers Used AgentQ. Did you use a real estate agent in your home buying process?Most Buyers Find Agents OnlineQ. How did you find your real estate agent?73More than Buyers Interviewed at Least 2 AgentsQ. How many agents did you interview prior to selecting the agent you used in your recent home purchase?74Buyers Continue Interviewing Multiple AgentsQ. How many agents did you interview prior to selecting the agent you used in your recent home purchase?Previous Performance Important to Buyers in Selecting AgentQ. What was the single most important reason for selecting the agent that you used in your recent home purchase?. 76Gap in Phone & Text CommunicationQ. What was your preferred method of communicating with your agent?Q. How did your agent actually communicate with you?77Q. 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 Agents78Room for Improvement in Agent Response TimeQ. 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?79Agent Satisfaction Ratings Improve- Average Ratings on 1-5 Scale -20132014Your real estate agents negotiating skills3.23.4Overall process of finding a home3.23.3Overall satisfaction with your real estate agent3.13.3Q. 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. 80Buyer Satisfaction Improves SlightlyQ. 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. 81Reasons for Satisfaction With AgentQ. Why do you have that level of satisfaction with your agent?Reasons for Dissatisfaction With AgentQ. Why do you have that level of satisfaction with your agent?More Buyers Would Work w/Agent AgainQ. Would you work with the same agent again?84What Buyers Would Change About the Home Buying ExperienceQ. If there was one thing you could change about the home buying experience, what would it be? 85So what?Key Conclusions & OpportunitiesBuyer Demographics are ChangingBuying Process Begins Before Agent is Contacted88Buyers Need Most Agent Assistance in Finding the Right HomeQ. In which part(s) of the transaction did you need the most assistance from your agent?Communication90Importance of Mobile91

93FinancingWhat Buyers Would Change About the Home Buying ExperienceQ. If there was one thing you could change about the home buying experience, what would it be? 95Advice to Agents from BuyersQ. What advice would you give to real estate agents to improve the process or the level of service?96THANK YOU!carmenh@car.org

How to Use Statistics to Establish Yourself as a Market Expert

Thursday, June 26, 20142:00 PM - 3:00 PM

To register: WWW.CAR.ORG/MARKETDATA/VIDEOS

Join us for our next webinarDo you want to enhance your knowledge on the housing market and further establish yourself as an expert in your market? How about providing your clients insights on the direction of the market using market analyses and forecasts? The Research and Economics team of C.A.R. would like to share with you the tools and the knowledge that could help you to become the housing market expert.

During the webinar, the Research and Economics team (R &E) of C.A.R. will discuss the market data and analyses that we produce and publish through the C.A.R. website. Housing market statistics are released on a monthly basis and surveys on the real estate industry are conducted regularly. Learn how you could use these statistics and analyses to educate your clients about the housing market conditions and to enhance your knowledge on the housing market. 98

QUESTIONS?101C.A.R. News102The Finance HelplineFREE Member BenefitProvides one-on-one helpDirect Line to Lenders

finance.car.org(213)739-8383financehelpline@car.orgBeing a member of C.A.R. for 27 years, this member service, by far, in my humble opinion, is the next best thing to having a license in this climate. Bravo! - REALTOR

The Finance Helpline was launched last year and has provided One-on-One assistance to REALTORS with any financing question, stalled short sales, down payment assistance programs, underwriting expectations, navigate through financing hurdles, and get their financing questions answered.

We have a Lender Liaison who serves as your direct line to key representatives at the lending institutions to help answer your questions and settle your financing difficulties during your transactions. For more information please visit finance.car.org or call 213-739-8383 today.

Visit: finance.car.org to submit your inquiryOr call: (213) 739-8383E-mail: financehelpline@car.org

103mortgage.car.orgMortgage Resource Directory

In conjunction with the Finance Helpline the California Mortgage Resource Directory helps your clients know what down payment assistance programs are available to them. Tell your clients to visit Mortgage.car.org to fill out the form with your clients to see what types of programs they qualify for today!

104The Ripple Effect that begins with a REALTOR

Dominate evening drive-time every Friday 2:30 p.m. 6:30 p.m.

Los Angeles, Sacramento San Diego, and San Francisco

Tonight Show Starring Jimmy FallonThe Today ShowEllenDr. OzThe VoiceMany other popular TV showsOur successful Consumer Ad Campaign is now in its second year.It began airing April 7 on TV and Radio with the same creative and messaging as last year.The campaign once again positions California REALTORS as being at the core of economic growth throughout the state.This year our television partner is NBC and our commercials will be seen on popular shows such as The Tonight Show with Jimmy Fallon, The Voice, Ellen, and many others.Once again, weve partnered with Clear Channel Media and Entertainment. Radio spots air every Friday during evening drive time in Los Angeles, San Francisco, San Diego, and Sacramento on these radio stations.105New This Year Social Media Custon ContentREALTOR RealTalkwww.realtorrealtalk.com

Interior Designer Thom FiliciaHGTV VignettesEXPO AppearanceRoom Makeover SweepstakesNew this year is a social media offering called REALTOR RealTalk. By visiting the website realtorrealtalk.com, you can create customized dos and donts to share with your clients on Facebook, Twitter, or your other marketing materials.As part of our media buy with NBC, were also receiving three TV vignettes with interior designer Thom Filicia who will offer design and style tips for staging a home. The vignettes will air on HGTV beginning next month and will promote a $10,000 room makeover sweepstakes, courtesy of NBC. Thom also is attending EXPO as a speaker during one of the free EXPO sessions.

106EXPO Luncheon SpeakersTerri SjodinBest-selling author of Small Message, Big ImpactCaptain Chesley Sully SullenbergerBest-selling author of Highest DutyLeslie Appleton-YoungC.A.R. Vice President and Chief Economist

TuesdayWednesdayThursday

On Tuesday, one of Americas most sought after female speakers Terri Sjodin (show-dean) will get things started as our first luncheon speaker. Sjodin (show-dean) is the best selling author of Small Message, Big Impact and during her talk she will discuss the power of persuasive presentation.

Wednesday, join Captain Sully Sullenberger as he discusses Leadership Without Ego and the harrowing tale of the Miracle on the Hudson.

And Leslie is back on Thursday to close out the week with the 2015 Housing Forecast. A truly cant miss lineup of speakers!

107Sheet1RegionPeak2014 Q1% CHGCA SFH$56,320$86,41953%CA Condo/Townhomes$44,440$71,99462%Los Angeles Metropolitan Area$53,780$81,19551%Inland Empire$35,170$55,30257%S.F. Bay Area$90,370$140,97756%US$32,000$39,73424%

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