Commentary by Ken Trepeta
RISMEDIA, May 10, 2008-The National Association of Realtors® and Harris Interactive recently partnered to conduct a public opinion study of consumer preferences when it comes to real estate services. In January, Harris surveyed over 1,400 recent and future home buyers. The last major survey of this type was conducted in 2002. The results show that consumer interest and satisfaction with one-stop shopping for real estate services is growing.
Numerous real estate firms have made considerable efforts to develop a menu of services for their clients over the past decade. The data shows that these efforts are bearing fruit as more home buyers are turning to firms that can offer a variety of services and thereby, are having a better home-shopping experience.
Some of the key results include:
– More than three-fourths of respondents would consider a firm that offers one-stop shopping.
– Some 96% think that receiving all services from one provider would make purchasing a home easier.
– Use of one-stop shopping has increased 45% since 2002.
– The advantages of one-stop shopping include making the transaction less expensive (77%), more manageable (73%), convenience (73%), preventing issues from falling through the cracks (73%), and having agents and other providers working together to ensure completion of the transaction (71%).
– Those who used one-stop shopping were more satisfied with the outcome than those who didn’t (8.3-7.6 on scale of 1-10). They were also almost twice as likely to prefer service providers be affiliated with their real estate agent and their firm.
– Half of recent buyers who knew their agent was affiliated with a full-service firm report that this had a positive impact on their choice of firm (as opposed to no impact).
– People who used one-stop shopping for their mortgage were 44% more likely to be completely satisfied than those who used multiple sources.
Consumers have more one-stop shopping opportunities than they did three years ago and diversified real estate firms continue to improve the consumer experience. Buying a home is more often than not a complicated process and people are finding the process is more manageable when their Realtor® has his or her hands on the pulse of the transaction.
More Work to Be Done
For firms offering one-stop shopping or a menu of services, more work needs to be done to educate the public. Fewer than half of respondents to the survey were more than “somewhat familiar” with the concept of one-stop shopping. For firms with affiliated services, it appears that more work must be done to educate the public and their agents on one-stop shopping. Firms might even consider working their affiliated services into the firm’s general advertising. For example, with the turbulence in the mortgage markets, making potential customers aware of an affiliated or in-house lender to help them buy their dream home is a key selling point demonstrated by the data. Four of the top five responses indicating the benefits of one-stop shopping relate to ensuring a smooth transaction that closes.
In addition, 52% of respondents who were aware that a firm offered a full range of services reported that it positively impacted their decision to use the agent and the firm (as opposed to no impact, not a negative impact). This means that one can expect that for every additional potential customer made aware of the services offered, there is a better than 50% chance that knowing a firm offers a full range of services could make the difference in choosing one firm over another.
The survey confirmed the top five most-recommended services associated with one-stop shopping are home warranty, inspection, closing and title, mortgage, and homeowner’s insurance. Home inspection was the top most recommended at 59%, followed by closing and title (49%), mortgage (31%), home warranty (23%) and homeowner’s insurance (20%).
Finally, the survey inquired about the public perception of the mortgage markets in general. Strong percentages of people with average or poor credit felt that it would be at least somewhat more difficult to get a mortgage (poor 80%, average 60%).
Of note, 42% of respondents blamed the mortgage market crisis on mortgage lenders and brokers, 16% on the government and 16% on borrowers. Wall Street came in third at 9% and builders came in fourth at 3%.
It is clear from the data that one-stop shopping is gaining in popularity and real estate firms are in an excellent position to capitalize. It is also clear that while progress has been made and approaches have become more sophisticated and consumer friendly, one-stop still has a long way to go.
Ken Trepeta is director of Real Estate Services at the National Association of Realtors.
For more information, please visit www.realtor.org.