Global Communications

Transcription

1 Global Communications Prudential Real Estate 2011 CONSUMER MARKET ASSESSMENT March

2 Survey Background Objective: Gather current insights on the factors impacting buyer/seller real estate decisions in today s economy. Methodology: The study was conducted as an online survey among a national random sample of Americans. Respondents are aged with a household income of at least $50,000, and either they recently bought/sold a home or they are considering to buy/sell a home. Total Respondents: 1,253 Target sample of Americans in the market for buying or selling a home 500 Recent Transactors Bought/sold home within the last year 500 Likely Transactors Indicated they are likely to buy/sell home within next year 253 Contemplators Considered buying/selling within last year, but did not Total data are straight averages and not weighted to reflect all Americans Survey Period: January 20 27, 2011 Survey developed by Prudential Real Estate and Relocation Services and Prudential Global Market Research 2

3 Optimism about the market is guarded 68% Agree volatility of U.S. economy makes them cautious about investing in a new home at this time 68% Have confidence that recovery of real estate market and property values will happen in next year or two 86% Believe that real estate is a good investment despite the market volatility of the past few years 3

4 House-hunters recognize a good opportunity Think: It is a good time to buy 49% Feel: Cautiously optimistic about buying or selling a home in today s market 47% Agree: Excited about buying a home due to momentum of economic recovery 59% Agree: Even though my house is worth less, I know I can buy a new house at a lower price 89% 4

5 Americans striving to move up is a driving force; Yet opportunities abound in all segments Overall goal in buying/selling Based on Total Respondents Move up Scale down 45% 21% Among those who want to move up 64% More space or property 57% Good time to buy 49% Nicer house 41% Better neighborhood Stay same 34% 5

6 Challenges of a complex market inhibit actions Reasons that contemplators have not yet bought or sold home Practical Just haven t found the home I want yet Waiting for right opportunity Lack of focus/time Economy Worry home values haven t stopped dropping Instability of economy Worry about not being able to sell current home Not confident in setting right price for home Worry about employment Personal Finance Trying to save more money Not sure about finances Nervous about new mortgage 6

7 Challenging the logic of buyers are sellers Impact of the recession on consideration to buy or sell a home Based on Total Respondents More interested in buying 58% Yet 61% Less interested in selling 7

8 Emotions run high with the thought of selling 77% Uncertainty of selling existing home in order to afford new home is a big concern 67% Won t buy new home until confident I can sell existing home at fair price and in timely way 60% I feel my home is worth more than what real estate agents tell me 58% Rationally understand good time to buy, but my emotions and concerns hold me back Based on Likely Transactors and Contemplators 8

9 In reality, very few show sellers remorse even in a down market 78% are satisfied with recent sale I regret selling my home in the past year 11% Feeling about final price paid in sale of home: Resentful, as I did not get what my house was really worth 6% A bit disappointed about price 16% Mostly just grateful that I was able to sell my home at all given the market conditions 46% Very satisfied with the final price paid in the recent sale of my home 32% 9

10 The greatest challenges of selling 90% Agree For me personally, I see pricing as one of the greater challenges in selling a home 88% Agree I think the marketing of my home is one of the greatest challenges faced in trying to sell a home 10

11 Buyer and sellers are humbled by market conditions Amateur Self-reported level of knowledge of residential real estate market Based on Total Respondents 54% Novice 5% 8% Expert 33% Semi-Pro 92% agree: Given the dynamics and challenges of today s real estate market, it is more important than ever to work with a good Realtor for the best success in buying or selling a home 11

12 Despite guidance of agents, many stick to their guns 93% 65% I believe I can rely on a professional real estate agent to help me price my home competitively I am not willing to compromise on pricing until after I market my home at the price I want Based on respondents who did/want to sell 12

13 Rational philosophy of pricing often becomes clouded by emotion and doubts In Evaluating Concept of Pricing a Home Higher Price Reduce visits Confuse expectations Raise doubt as to worth Limit bid activity At market or below Attracts more visitors Meets expectations Offers buyer flexibility Draws more bids 96% Agree this concept makes sense 63% Would still be inclined to price home above market averages 61% Would need agent or evidence to better convince them of this claim 13

14 Sellers may need to be carefully coached to be more realistic about pricing strategy Strategy when Selling a Home Buying a Home Price right at or slightly below market, hoping to attract more visits, bids, etc 53% 74% Many homes could meet my needs, I d rather get a good price Price slightly higher than market, hoping to find buyer willing to pay more 47% 26% Willing to pay top of the market for home that specifically suits my needs 14

15 Real estate agents seen as helpful ; today s market presents prime opportunity to prove vital 15% I could not navigate today s real estate market without agent 60% A good agent is very important in helping me successfully buy/sell home 24% Agent is helpful, but not imperative 15