Tradition has been turned on its head. The Internet buyer has become the "typical" home buyer over the last few years, according to the just-released California Association of Realtors'® "2006 Internet Versus Traditional Buyer Survey."
This is a significant finding as one out of six American homeowners lives in California. How California homebuyers shop for homes will become the way the nation shops for homes.
Since 2000, the share of home buyers using the Internet has grown from 28 percent to 70 percent in 2006. Internet buyers are younger, wealthier, better educated and more likely to be married than traditional buyers. Internet buyers also reported greater satisfaction with the home-buying process compared with traditional buyers.
Lucky for Realtors, most buyers consider the Internet an information source -- not a substitute for hiring a Realtor. In fact, nine out of 10 Internet buyers hired a Realtor to help them in the homebuying process. They were generally more satisfied with their agents because of their responsiveness.
C.A.R. President Vince Malta observes that while the Internet is changing the dynamics between buyers and their agents because of its use as a research tool, it has only enhanced the Realtor's role in the transaction. "Buyers continue to rely on their Realtor's help with interpreting the information gathered from the Internet and to guide them through the home-buying process," he says.
According to the survey, more than nine out of 10 Internet buyers indicated that the Internet helped them better understand the process of buying a home. Additionally, Internet buyers are accustomed to receiving more frequent communication and faster response times from their Realtors.
High-speed Internet access at home enables buyers to gather information on all types of products and services quickly and easily, suggests Malta. "This trend has carried over to the process of buying a home. As a result, home buyers are more informed, have a greater sense of control over the process, and hold high expectations concerning how quickly they receive information," he notes.
Internet buyers and traditional buyers expressed significant differences in how they conducted their home-buying research. Internet buyers conducted more research at the onset of the home-buying process, while traditional buyers relied more on their agent as their source of information.
Other key findings from C.A.R.'s 2006 Internet Versus Traditional Buyer Survey include:
- The median age of Internet buyers was 39 years compared with a median of 42 years for traditional buyers.
- More than nine out of 10 Internet buyers were married, while nearly eight of 10 traditional buyers were married.
- Seventy-three percent of Internet buyers had at least a four-year college degree and 11 percent completed post-graduate work. By comparison, 72 percent of traditional buyers held a college degree and 5 percent completed post-graduate work.
- Internet buyers had an annual income of $184,900, compared with $148,910 for traditional buyers.
- Internet buyers spent an average of 5.8 weeks considering buying a home before contacting a Realtor, nearly three times more than traditional buyers, who spent 2 weeks in this stage of the home-buying process.
- Internet buyers spent 2.2 weeks looking for the home they ultimately purchased, compared with 7.1 weeks for traditional buyers.
- Fifty-four percent of Internet buyers said the information that they gathered from the Internet was less useful than that provided by their Realtor; none considered the information gathered from the Internet to be more useful than that obtained from their Realtor.
- All first-time buyers typically spent 5.3 weeks considering buying a home and 4.3 weeks investigating homes for sale before contacting a Realtor. They then spent 3.2 weeks previewing eight homes with their Realtor.
- All repeat buyers spent 3.3 weeks considering buying a home and nearly three weeks investigating homes for sale on their own. They spent 5.4 weeks previewing 13 homes with their Realtors.
Concludes the analysis of the report, "In the future, agents who want to maintain their competitive edge will need to become familiar with the ever growing array of online consumer homebuying tools, broaden their online presence, and enhance their communication with clients through the use of the latest Web trends such as blogs and podcasts."
