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Report
Client Service is Changing…
42% of homebuyers purchased a home
for the first time in 2001.
NAR Profile of Home Buyers and Sellers 2002
A typical homebuyer is a married couple age
36 and earns $71,300 household income
NAR Profile of Home Buyers and Sellers 2002
Source Used in Search
Agent
Newspaper
Internet
Home Book
Open House
1995
86%
51%
2%
30%
41%
2001
79%
41%
41%
24%
29%
CAR Internet Versus Traditional Buyers Study 2002-1
Customer Satisfaction
Overall Process
Kept Informed
Schools/Crime
Buying Process
Assistance
Negotiating
Value for Pay
Internet Traditional
97%
38%
88%
36%
83%
35%
79%
33%
75%
39%
76%
37%
48%
30%
CAR Internet Versus Traditional Buyers Study 2002-1
Frequency of Contact
Traditional – 6.5 days
Internet – 4.3 days, 5 more times in 60 days
CAR Internet Versus Traditional Buyers Study 2002-1
Desired Changes
Negotiate Better
Screen Houses
Keep Informed
Internet Traditional
3%
30%
0%
5%
1%
6%
CAR Internet Versus Traditional Buyers Study 2002-1
Finding an Agent
Internet Traditional
Internet
79%
Mailers/Flyers 12%
44%
Sign
1%
16%
Referral
19%
CAR Internet Versus Traditional Buyers Study 2002-1
Previous Living
Arrangement
45% Rented, 43% owned, 11% lived with
parents, relatives or friends, 2% rented
home that was purchased
NAR Profile of Home Buyers and Sellers 2002
Factors for House Change
74% Neighborhood
58% Price
29% Work
29% School
23% Family and Friends
15% Parks and Recreation
11% Shopping
2% Health Facilities
NAR Profile of Home Buyers and Sellers 2002
Reason For Choosing Agent
36% - Friend, Relative, Neighbor
13% - Used Previously in Buying or Selling
9% - Personal Contact by Agent
7% - Reputation
7% - For Sale Sign
6% - Visited an Open House
6% - Walked into Office
NAR Profile of Home Buyers and Sellers 2002
Interviewing an Agent
59% - One
22% - Two
13% - Three
NAR Profile of Home Buyers and Sellers 2002
Ethnic Background
European, Caucasian, White
Asian
Hispanic, Latin American
African American, Black
Internet Traditional
46%
60%
30%
19%
18%
16%
4%
4%
Client Service is Changing…
Questions
Understanding used to be knowing all the right
answers. Today for brokers and agents it is asking
the right questions.
The Questions
1. What changes are you experiencing?
2. What business propositions will make the
biggest difference over time?
3. How and who will compete with the
proposition?
4. How will you counter the competition?
Wall Street is
Targeting R.E.
Business models built on obtaining fees
from referrals, property data, and ancillary
services. (i.e. loans, title, etc)
Railroads or Transportation?
8 of 10 buyers and sellers received
recommendations for other real estate services
and 90% purchased at least one product.
NAR Profile of Home Buyers and Sellers 2002
Commission Pressure
1991 commission 6.34%, 2000 - 5.48%. (-14%)
1991 agent split was 64/36, 2000 - 72/28. (+13%)
Brokers Expanding
Traditional - Mortgage & Title Service
Future - Move to Maintenance (118 U.S. Brokers)
Broker Consolidation
1991 –2000 Nation’s top 8 brands grew
from 32% to 54%
Team Concept
Assistants (Licensed and non Licensed).
Specialized Assistants (Buyer Agent, Seller
Agent, Administrative Agent)
Client Service is Changing…
Office Security
Tenants are demanding specific security
measures and new terrorist clauses in leases.
(CIE) Commercial
Information Systems
More local and regional CIEs have been
formed in the last 12 months than in history.
Consolidation
Mergers and acquisitions abound in
commercial even more so than residential.
International
Major demand for the skills of commercial
REALTORS in international arena. CCIMs
graduating at large rate in China.
Client Service is Changing…
LIFE BEFORE THE COMPUTER
• A cursor used profanity.
• A virus was the flu.
• And if you had a 3 ½ inch floppy,
you hoped nobody found out!
60% of Buyers View
Property on WEB
Are they looking for your listings, the
company listings, or the MLS listings?
Prepare for IDX and VOW
2002 Top Websites
1)
2)
3)
4)
5)
6)
7)
8)
9)
82% - Company Website
73% - REALTOR.com
67% - Agent’s Website
52% - Websites w/ homes of interest
49% HomeAdvisor.com
34% - HomeGain.com
29% - California Living Network
28% - Homebuilder Websites
11% - REALTOR Association Websites
CAR Internet Versus Traditional Buyers Study 2002-1
Real Estate is Local
65% of buyers come from the county and 87%
come from the state in which they live!
Enhanced Web Pages
Average number of homes
visited with the agent
7.5 Internet Buyers, 15.2 Traditional
Most Important
Web Features
1)
2)
3)
4)
5)
6)
7)
46% - Preview homes to narrow search
21% - Identify specific homes for agent to show
18% - Info on financing and down payments
9% - Find an agent
3% - Learn about neighborhoods
2% - Originate a mortgage
1% - Pre-qualify for a mortgage
CAR Internet Versus Traditional Buyers Study 2002-1
Most Frequently Used Features
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
88% - Identify specific homes for agent to show
87% - Preview homes to narrow search
73% - Find a specific agent
38% - Info on home financing & down payments
32% - Find a real estate firm
23% - Pre-qualify for mortgage
21% - Info about mortgages and rates
16% - Learn about neighborhoods
10% - Originate mortgage on line
6% - School Districts
CAR Internet Versus Traditional Buyers Study 2002-1
MLS to MIS
or Lose the Transaction
It is about cooperation AND reducing cost!
Tax, appraisal, virtual assistant for CRM,
and web marketing.
Brokerage Mgmt
There is NO cost effective front to back office
seamless web based software for brokers.
MIS via Handheld
Tech firms are focusing on applications for
PDAs giving access to information in the
field without a laptop.
PDAs Evolving
75% of AOL emails are instant messaging. By the
end of 2002 half of the top 1000 corporations
will use instant messaging. In Europe SMS
messages most popular use of cellular.
We Are Broadcasting
Previously by paper, computers now move
billions of messages in the realm of bits
which are low hanging fruit for the picking!
Pirates are Stealing!
NAR is reporting numerous lawsuits against
companies stealing data from the local MLS and
from the local brokers.
Wipeout Your Business?
In 1988 there were 6 viruses.
Last year there were over 21,000!
Client Service is Changing…
“Give a man a fish, feed
him for a day; teach him
to use the Internet and he
won’t bother you for
weeks.
With IDX, a broker may only display
properties listed by that broker OR
properties the broker has received
permission to display.
The rationale for listing broker to “opt out” of IDX, is
the broker’s ability to participate in the MLS’s
proprietary system should not be conditioned on
willingness to allow competitors to advertise his
listings on their public websites.
The primary features of a VOW today are that
visitors register by entering an email address and
receive a password prior to accessing MLS data.
The rationale for a VOW is analogous to
a consumer’s visit to a broker’s
“bricks and mortar” office.
Therefore the VOW broker believes he
is entitled to provide visitors with the
same information provided to a
consumer physically present in a
broker’s place of business.
Brokers operating VOWs maintain that the
registration process, sometimes involving
passwords, and the requirement that
visitors indicate by mouse-click agreement
with the broker’s terms of use, takes such
websites outside the MLS rules governing
IDX.
Some VOW operators are displaying ALL of
the data fields available in the MLS, including
showing instructions, broker-to-broker offers
of compensation, and other confidential
information.
IDX
VOW
1. No Registration
1. Must Register
2. Can Opt Out
2. NO Opt Out
3. MLS determines
information to be
displayed
3. Broker determines
information to be
displayed
NAR considering for VOWS
1.
Verify the validity of the
registrant.
2.
Comply with all legal
requirements to establish a valid
and lawful relationship
3.
Supply a unique user name and
password
NAR considering for VOWS
4.
Registrant must affirmatively
express:
•
Use is non commercial
•
Bona fide interest in purchase,
sale, or lease.
•
Will not copy or redistribute data.
•
MLS ownership and copyright of
the data
NAR considering for VOWS
5.
VOW must protect the MLS data
from misappropriation by
employing reasonable efforts to
monitor for and prevent “scraping”
or other unauthorized accessing,
reproduction or use of the MLS
database.
NAR considering for VOWS
6.
Restrict data intended exclusively
for MLS participants such as:
•
Seller(s) name, phone, email
•
Compensation offered and type
of listing agreement.
Showing instructions
•
7.
MLS data fields authorized for
display may not be changed.
THE POINT!
Clearly web power is and will
continue to have an impact
on client service and the real
estate industry!
Client Service is Changing…
More Diversity
Salsa now out sells ketchup in the US.
By
2050 there will be no majority race in the US.
Brokerages that get more diverse will win versus
trying to teach culture to current members.
Business from On-Line
1999
0%
43%
1%-5%
43%
6%-10%
9%
11%-20%
3%
Over 20% 1%
2001
29%
49%
14%
6%
3%
NAR Profile of Home Buyers and Sellers 2002
Education is Rising
1978 - 58% had some college.
2001 - 72% had some college.
Designations and Certifications are up.
Education by Satellite
Web or Wireless
New education is being delivered in multiple
and creative ways to students.
Client Service is Changing…
Senior Power
75% seniors say they never intend to retire.
80% own their own homes.
People age 75, buy more than ages 55 & 65.
Single Women Buyers
In 10 years single women homeownership grew
65%. Business Week shows female managers
are better than men in almost every measure.
More Urban Dwellers
Singles who are buying homes in greater
numbers than ever, like to live close to
work and social life.
Targeted Mortgages
Higher ratios for people who live near
public transportation. Special loans for
police officers and others.
A World Business
Foreign-born households contributed 1/3 of
household growth in USA. 16% of REALTORS
have conducted business in another language.
Client Service is Changing…
Automation Goes
Mainstream
Builders installing hardware and software to
control all home systems - television to
toaster – coffee to communications.
Greener Houses
Buyers opting for recycled materials. Carpeting
from plastic. Bathroom tile from automobile
glass. Insulation from newspaper and straw.
Renting By Choice
Apartment dwellers with incomes more than
$50,000 jumped 11.2% from 2000 to 2001.
Good news for the multifamily Industry.
Housing Affordability
Oakland CA - 24.4%
Portland - 45.8%
Boulder, CO - 59.2%
Austin, TX - 61.9%
Kansas City, MO - 86.1%
In Oakland a family with a median income can
only afford 24.4% of the cost of the median
priced home!
Client Service is Changing…
There were 1000 growth issues on the
ballots in the 2000 USA election and
most were NO GROWTH!
Insurance is loaming as being the very
biggest issue to face the real estate
industry in years
How will one more terrorist attack
impact the US economy? Or no
terrorist insurance for construction?
World War II - 1941-44, Korean Conflict - 50-53
Vietnam - 1953-72, Kuwait/Iraq - 1991
Afghanistan - 2001 to ?
8:46 a.m. Sept. 11, 2001
9:03 a.m. Sept. 11, 2001
9:40 a.m. Sept. 11, 2001
9:43 a.m. Sept. 11, 2001
10:10 a.m. Sept. 11, 2001
10:05 a.m. S. Tower & 10:28 a.m. N. Tower
Sept. 11, 2001
Just 102 minutes!
If you think things will get back to normal..
can you really define what “normal” means?
Wall street stock dropped the
equivalent of two entire Japanese
economies.
192 countries - % of Economies that are Corporations
42 of the Top 100 – 42%
123 of the Top 200 – 62%
A corporation is not a democracy.
People in corporations are being busted,
settling government claims or under
indictment and investigation!
In the middle of all this chaos, where do
REALTORS turn to provide outstanding
client service?
Under all is the land. Upon its wise utilization
and widely allocated ownership depend the
survival and growth of free institutions and
of our civilization.
Such interest impose obligations beyond
those of ordinary commerce.
NO inducement of profit and no instruction
from clients ever can justify departure
from this ideal.
… share with their fellow REALTORS a
common responsibility for
INTEGRITY AND HONOR.
The greatest danger for most of us is
not that our aim is too high and we
miss it, but that it is too low and we
reach it. - Michelangelo
“The strength of a nation lies in
the HOMES of its people”
“I have not yet begun to fight”
John Paul Jones
“No victim’s family will
lose its HOME”
“Confusion has always been a part of
the world and WILL CONTINUE!”
So How Do REALTORS
Respond?
“ …when you get the choice
to sit it our or dance,
I hope you dance…”
Because the answer has
been the same throughout
history
Your
LEADERSHIP
REALTORS
Lighting a flame for the future!

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