Ellen Roche managing director of real estate research for the National Association of Realtors is already planning the next biennial survey of buyers and sellers. Questions raised by the results of each survey show trends that signal change, such as the pervasiveness of the Internet. And that is what helps determine what will be asked of buyers and sellers with regard to the purchase and sales of their homes.

Agent News asked Roche which results she found the most intriguing from the "2002 Profile of Home Buyers and Sellers.” She picked four areas related to information which could reflect on agent/broker profitability.

Buyer’s Representation

Roche began with the results on page 23, in which a high number of buyers didn’t know whether or not they had been disclosed by their agent with regard to representation (21 percent,) whether they had a buyer’s agreement with their real estate agent (33 percent,) or whether they had paid or not paid their buyer representative’s compensation (13 percent.)

”I’m intrigued by the high “don’t knows,” says Roche. “I think this represents the complexity of the transaction, rather than an indication that information such as disclosures weren’t given. On page 23, first-time buyers are more likely to say they don’t know whether they received a disclosure or not.

”I would explore that question from the question of who represented the buyer – ‘who represented you?’ The listing agent, an independent agent, and then do a follow up question on the order of ‘is that person a buyer representation specialist?’”

FSBOs

”I think that the one of the things we are looking at is the FSBO share,” observes Roche. “While it has declined, when you ask buyers who they bought their home from (p.16), 15 percent bought the home from a previous owner. There is a discrepancy. On page 46 in the FSBO section, sellers were asked ‘did you sell yourself?’ and 13 percent did.

”I think what the distinction is that the questions are a little different. One of the things I am looking at is on p.16, in 1995, it was only 9 percent of buyers who had purchased from a previous owner. We wonder if we are talking about a generational transfer - you aren’t talking about an arm’s length FSBO, you’re talking about the kids buying the house from the parents for a dollar. My question is ‘are we entering that demographic where those types of transfers are more common?”

Roche cites a personal example. Her sister and her husband purchased his parents’ home – for a dollar. “Even if the purchase price were closer to the market price, the question is does the real estate agent have a shot at that transaction? We are looking at that and will try to collect better information.”

Working with builders

”In that same chart, look at the increase in people buying a home from a builder. While some may have used a real estate agent, they didn’t report it. Homebuilding must be taking off. On p.16, we have data from four past surveys. In 1995, only nine percent bought from builders. This year, 15 percent bought from builders. This shows a question in the relationship between builders and real estate agents. Is there an opportunity for agents to work more closely with new home builders?”

The Internet

Everybody is talking about the Internet, how it has grown in use from 2 percent of homebuyers in 1995 to 41 percent in 2001.

”We want to say the use of real estate sources has remained the same, but you do see a decline in certain sources,” notes Roche. “They (buyers) are using open houses less, friends and neighbors less - those are interesting declines. Who uses the Yellow Pages to find a house? This is interesting for Realtors for where they are going to their marketing money.”

”On p. 29, we talk about Internet homebuyers and their characteristics and we describe them as younger and making e more money, but in terms of a trend, that may not be the case. The latest Harris poll shows that 66 percent of all adults are online. Once you have that percent of the population online, the Internet buyers are going to start looking like traditional buyers.”

Roche offers an indicator. “What we see between the previous survey and this one is that there was a difference of five years in 2002 and now there is a difference of four years in age. In 2000, Internet buyers income was 25 percent higher, now it is only 18 percent higher,” explains Roche. “The idea is some people are drawn to the Internet, but over the next three to five years, those profiles are going to become more similar because Internet users are mainstream now.”

These are among the considerations that Roche will use in designing the questions for the next survey.