The Unconditional Blog

The impartial voice of the industry

 
6

Talking with our customers – interesting insights from recent survey

Posted on: September 2nd, 2011 | Filed in Buying / Selling a home, Featured, Property Investing, Renting, Website searching

We recently undertook a survey amongst our email subscriber database. What prompted this was a desire to learn more about the make up of this group of avid users of the site to see how we might improve the service we offer on Realestate.co.nz to buyers, sellers, investors, tenants and any other form of property hunting fanatic!

What we have discovered is very interesting and certainly worthy of sharing. If you participated in the survey; we really appreciate you taking the time to complete the survey and we hope with your help to repeat it again on maybe a quarterly basis as the data is valuable, and to see trends over time for some of the finding will be useful.

To start with we had 398 people complete the survey – a significant number and certainly large enough for the data to be representative of people in the market for property (we are not statisticians nor a research company so we are not trying to make any comment as to statistical margin of error etc).

The first question we asked was as to the status of the respondents.

The largest group (40%) are looking to buy property – this made up of 7% as first time buyers and 32% as general buyers. A fifth of respondents describe themselves as a landlord, with a further 7% saying that they are (or are looking to be) an investor.

Buyers

We then went on to ask the prospective buyers amongst the respondents when specifically they were looking to buy?

Not surprising was the fact that just under a third were looking to buy (we assume this is intent to be buying / searching actively as opposed to completing the purchase) in the next month. In total it would appear that over 60% of buyers are looking to be buying in the next 6 months in total, this would be expected as subscribers to the email are actively keeping tabs on the property market and receiving daily email alerts of new properties. We will be keen to ask this question again in the future to see how trends change over time by factor of market conditions and seasonality.

Additionally of interest is the fact that 11% are showing a reluctance to buy as they are waiting until the market improves.

Tenants – looking to buy

We also asked the same question of current tenants who expressed an intent to buy a property in the future. Their response was somewhat difference due to their circumstances.

Clearly the key issue for this group of respondents is the need to save for a deposit; a third of the respondents saw this as the key step to buying. Of the remainder 18% said they were looking to buy in the next 6 month, far less than active buyers, but interestingly a lower percentage (8%) felt that they would leave it until the market improves.

Type of property to buy

Going back to the group who are thinking of buying a property we asked them what type of property they were considering buying.

The majority of people (53%) looking to buy were interested in a property that would need a bit of work to be done – clearly the kiwi DIY mindset is still alive and well as people as still keen to add value to properties. This compared to just under a third who really wanted somewhere where the renovations had been completed and the property was ready to move in straight away.

Sellers

Moving from buyers to sellers we wanted to find out when those people who considered themselves sellers were looking to sell. The vast majority (83%) were looking to sell in the next 6 month, with 4 out of 10 thinking of selling in the next month, or at least putting their property on the market.

How would you sell?

We then posed an interesting question to those looking to sell. We asked them how they were looking to sell their property. Would they use a licensed agent, try and sell it themselves or might they give private selling a go, but more than likely end up using a licensed real estate agent. Having collated the results of this question we compared these with the recent Nielsen online real estate market survey asking the same question.

These results are very interesting. From both surveys the majority of respondents were likely to use a licensed agents, the sample respondents from the Realestate.co.nz email group were slightly more likely than the broader Nielsen market survey.

When it comes to selling privately the difference were significantly different, just 5% of the respondents to the Realestate.co.nz survey indicated that they would try and sell privately as against 11% for the broader Nielsen survey. Of note is the fact that the Nielsen survey was based on questionaires posted on both Trade Me and Realestate.co.nz and this is clearly showing that greater interest in private sales from Trade Me respondents to the Nielsen survey.

Investment Properties

The final set of questions we asked related to investment property. We asked those who described themselves as a landlord or investor how many properties they owned.

70% of those respondents who identified themselves as a landlord or investor had more than 2 properties with 14% having more than 5 properties. Clearly the Realestate.co.nz website is a core resource for investors looking to enhance their property portfolio.

Of these landlord we then asked if they used a Property Manager to manage their property / properties – or if they did themselves. Fully two thirds said that they managed their investment properties themselves with just one third using a professional property manager.

Probing a bit deeper we then asked them why they chose not to use a Property Manager.

Some useful insight here to assist the Property Management companies in providing support for this important sector of the property market.

 

 

Article Discussion

  1. Interesting to see that of those surveyed 30% of buyers want to buy over the next month and 40% of sellers want to sell in the next month.

    Looks like we will have a busy September if the frantic August was any gauge!

  2. Fiona Audain says:

    After having had our home listed on General listing with three firms here in the Taranaki, we have dropped our asking price twice, then we got an offer that was $15,000 over our GV and were told by one agent that we should accept it as we wouldn’t be likely to get any better. This is despite the fact that we have replaced the kitchen, bathroom and recarpeted. Is it still a buyers market, we drove around yesterday and any homes that were in the same price range as we have been offered are older, less land or garaging. Are we being greedy or sensible, as we are looking to buy into a home in a more expensive district??

  3. Very interesting info – thank you putting that together and sharing it with us!

  4. Tricia says:

    In response to Fiona Audain, Sept. 4: “are we being greedy or sensible?” We have been in the same position and after a lot of research my conclusion is that it is highly relative to the perceptions of a market that is being manipulated everyday by a media whose bottom line is to attract readers through sensational headlines rather than responsible reporting. Sellers are still hanging onto their perceived value based on either what the market had been for many years before the downturn or based on their investment, so are still holding out for more. Buyers are still spurred on by stories of amazing bargains from mortgagee sales so expect all sales to be similar bargains. The real estate industry has also not done themselves any favors because their overall assessment of the market is based on their total earnings which is lower when volume of sales is lower – which is has been, significantly, since the downturn. However, the vast majority of sales prices have NOT been significantly reduced since the downturn. In fact, it has gone up in some suburbs. Then there are the home improvement magazines and stores that tout the increase value in sale price when you make their recommended improvements. Again, we have been misled because most of the time the true total cost of those improvements are not fully recovered in the sale price. So, it is important to distinguish those improvements that are necessary to even get a sale vs. those to improve the sale price and what they really cost. Lastly, the financial institutions (read: banks) who aren’t doing any of us any favors so I won’t even go there! In the end, it doesn’t matter if you are being greedy or sensible – it only really matters if you are getting on with your life. Are you more concerned about your long term investment or moving to a better neighborhood for your household now? I like to follow the advice Suzie Orman gives when deciding whether or not to sell and at what price: “If you had the same amount of dollars in your hand that you could sell your property for today, is your property the one you would buy or would you buy something else?” If the answer is “no,” then sell for what you can get in the market now. If the answer is “yes,” then stay put and enjoy it until you can do better. If the answer is “don’t know,” then hold out longer until it changes. Good Luck to us all!

  5. Tricia

    Many thanks for your contribution and insight, it is great to hear this view.

    I agree with your comment that improvements cannot always be thought about in terms of a pure “return on investment” – $10,000 on improvements are not likely to see a $10,000 premium in sales price as compared to a comparable home. The reality is that a well presented home that is well marketed will attract attention and as a consequence buyer interest. This is when the challenge is faced as to a sale price. For until you have a prospective buyer with the interest and ability to pay your view of price / value is an academic exercise.

    To Fiona – good luck and I hope that your property finds the right buyer – make sure you examine the way it is marketed so as to reach all prospective buyers – the web is now the most important medium and rich information on a property online is key.

  6. Bec says:

    Tricia,
    As a family who have just sold and are looking at buying we see desperation when a property is listed with many different companies. Also if buyers are keeping an eye out and are noticing a price drops, this will also affect any offers as the longer they hold out the cheaper they may pick up the house. Just some thoughts. Good luck!

Post your views