Buyer Perceptions for Real Estate Agents 2016 FINAL

2016 CoreLogic Buyer Perceptions of Real Estate Agents | 1

Buyer Perceptions of Real Estate Agents 2016

Consumer Perceptions Series

2 | 2016 CoreLogic Buyer Perceptions of Real Estate Agents

In May 2015, CoreLogic released the Vendor Perceptions of Real Estate Agents report. The report was the first to examine - and challenge - the reality behind the popular stereotypes that real estate agents are untrustworthy smooth-talkers who put their own needs above those of their clients.

The 2015 vendor survey found the urban myth to be largely false in the eyes of vendors with 66% of property sellers claiming to have had an Excellent (31%) or Good (35%) experience when selling their home. It further found that 68% of vendors would recommend their agent to their family or friends.

But the vendor survey also gave some insight into where real estate agents go astray and the behaviours that need to be addressed to remove the stigma of being untrustworthy or selfish.

Prime amongst these was the abhorrence by vendors of the agent practice of ‘managing down’ on price with the survey revealing that while the proportion of vendors who were dubious and disappointed about their agent’s skill level was extremely low at the start of the sale process (4%), this leapt to 17% by the end of the sale.

Feedback about the value of the research from the industry was so strong, we decided to follow up with a second survey examining the perceptions of buyers who are the focus of this new report.

Buyers do not pay for the services of real estate agents when purchasing property (unless they use a buyers’ agent which was not part of this survey) and in most instances – especially in the currently buoyant market – there are many more buyers than there are homes to purchase, so disappointment can be rife.

At CoreLogic, we wanted to understand how large a part the ‘missing out factor’ played in the perception of real estate agents in the eyes of buyers. We also wanted to understand the expectations of buyers and to what degree it is realistic to expect sales agents to fulfil these expectations.

Most importantly, we wanted to overlay the expectations of buyers with the expectations we saw from vendors in the original report. Within the common ground of these two separate pieces of data come the insights of what service excellence truly looks like for real estate agents.

At a time when the industry is being significantly disrupted by technology, understanding new expectations around delivering best practice service levels is the most powerful way to ensure the industry has a viable future.

The 2016 Buyer Perceptions of Real Estate Agents attracted 546 respondents, a proportion of whom were still looking to purchase at the time of the survey.

Respondents were asked to rate their experiences and

rank behaviours and skills that they thought agents had excelled at, or had conducted poorly across their buying process. For those respondents who had successfully bought a new property, they were also asked to rank how the agent they finally purchased from performed across the same criteria as the agents they experienced generally. The results are telling.

At CoreLogic, it is our belief the industry needs to embrace transparency and rigorous examination to demonstrate where professional services are meeting and exceeding or failing to deliver to consumer expectations. In such a way, we will be able to identify and stamp out both the practices and reputation of the unreliable salesman once and for all.

The report helps us understand what excellence in real estate service looks like through the eyes of buyers and how to lift standards more broadly across the industry. The report delivers insights into agent market knowledge, professionalism, and agent training standards and helps provide a roadmap for improvement.

Lisa Claes

Managing DirectorAustralia and New ZealandCoreLogic

Welcome01


Contents01 09WelcomePage 2

Specific vs General Agent BehaviourPage 18

How my agent performedPage 19

What buyers wantPage 20

Hallmarks of service excellencePage 21

02Executive SummaryPage 4

Key Findings Page 6

Key Statistics Page 7

03 10MethodologyPage 8

Cynicism Of Those Still SearchingPage 22

04Buyer InsightsPage 9

05 11Buyer ResearchPage 10

Buyer Recommendations & Repeat BusinessPage 24

Behaviours that alienate buyersPage 25

The power of follow upPage 26

06Buyer SatisfactionPage 11

Are buyers harder to please than sellers?Page 12

07 12Agent Skill Levels Page 14

Buyer comments on price guides Page 15

How Buyer & Vendor Perceptions ComparePage 28

08 13Agent BehaviourPage 16

Buyer comments on honestyPage 17

ConclusionPage 29


There is an old saying that when a service is free, it’s probably worth the amount you’re paying - nothing.

Certainly many property buyers feel this way when dealing with real estate agents. The Buyer Perceptions of Real Estate survey identifies that the stereotype of the white-shoe clad, untrustworthy smooth talkers is strongest amongst buyers (rather than sellers), and especially amongst those who are yet to find their dream property.

The Buyer Perceptions of Real Estate is the second survey CoreLogic has conducted. Its aim is to better understand the customer experience consumers have with real estate agents with a view that what is measured can be improved and be part of a dialogue that works to lift industry standards.

Last year, we produced the Vendor Perception of Real Estate Agents and in this report we contrast and compare the results of both to capture a fuller picture of how key behaviours and skills affect the ability of agents to list and sell properties and develop valuable repeat business in the process.

This new Buyers Perceptions report identifies that while the proportion of negative experiences are fairly even for both vendors and buyers, buyers are more likely to

have an Average experience with real estate agents. The report shows that while 33% of vendors rated their real estate experience as Excellent, only 14% of buyers felt it deserved such a ranking.

Buyers understand that agents are there to serve the vendor and as they do not pay an agent, they have limited power to demand better treatment. But equally, they are genuinely confused why so many agents – always on the hunt for their next listing – just don’t seem to comprehend that good service creates referrals and new business.

The survey delivers some extraordinary insight into the depth of feelings that buyers have around the legacy method of selling property, based as it is in opaque processes, complicated negotiations and political one-upmanship. Comments in the survey identify the frustration so many feel and how they are no longer prepared to be silently mystified – especially when they are the ones spending many hundreds of thousands of dollars.

But equally, the survey reveals the extraordinary opportunity agents have every time they hold an open for inspection. When an agent delivers a quality service to a buyer, three things happen – they are extraordinarily grateful, they become a client for life and they tell all their friends. This makes buyer-care one of the most powerful and affordable – yet undervalued assets any real estate agent can own.

33% of Vendors rated their real estate experience as Excellent, but only 14% of Buyers felt it deserved such a ranking.

Executive Summary02



1. A transparent process from end to end – both buyers and sellers want to understand the process in advance, be advised where issues are likely to occur and understand how these issues will be dealt with. They also want agents to recognise that the process finishes at settlement once they have all happily moved in to their new property.

2. Honesty – buyers and sellers want an agent who is upfront with them and straightforward in their dealings. Customers smell bull$&*7 a mile off. It is the fastest way to guarantee disengagement from buyers and fury in vendors.

3. Empathy and care – listen and understand the needs of your clients. Take their personal circumstances into account when recommending properties or sales methods. Don’t try to force fit them into listed stock or sales methods that put the agents’ business ahead of the client’s circumstances.

4. Be proactive – Look at ways to delight clients by pre-empting their needs. Avoid the stress of common mistakes by identifying them in advance. Have a process that explains how issues will be rectified. Be proactive about picking up the phone.

5. Transparent pricing – both buyers and vendors want agents to demonstrate pricing expectations with data proof points. Provide recent sales and data to support asking prices. Direct clients to tools and reports so they can sanity check their thinking.

6. Communication and accountability – Clients want agents to do everything they say they will do. Regular contact and follow up at every stage is essential. Always give buyers the option to make one final offer in a negotiation.

7. Be friendly and approachable – clients appreciate agents who are easy to talk to and with whom they felt safe to ask questions at any time, or who could coach and mentor them.

8. A relationship, not a transaction – buyers and vendors are impressed by agents who demonstrate they are interested in the relationship with them as a long term client, not just a lead or a transaction.

Key FindingsA compilation of the findings from the Vendor and Buyers reports, identifies the following standards to delight both buyers and sellers.

The New Standard

The power of delivering excellent service to buyers. When agents deliver excellent service to buyers, three things happen:

1. The agent stands out from their competitors and the buyer is extremely grateful.

2. Buyers become clients for life and choose agent to sell through.

3. Buyers refer the agent to friends and family who are selling.


58%of buyers rated their experience of buying a home as positive but only 14% said it was Excellent

33%of buyers said the post purchase follow through of the agents they dealt with was negative.

68%of buyers stated agents had little to no interest in helping them find a suitable property to buy.

Key Statistics

9%of Buyers claim the honesty and trustworthiness of agents is Excellent. But 28% claim it is negative.

28%of buyers said the price guide offered by agents was negative. Only 9% of buyers said agents were Excellent in this area.

46%of buyers are using property reports to help them understand pricing.

57%of buyers would recommend their agent to family or friends.

25%of buyers expect to stay in touch with their agent and use him or her again.


MethodologyThe 2016 Buyer Perceptions of Real Estate Agents Report is based on the responses of 546 respondents who bought or were looking to buy property in Australia in the 12 months of September 2015 to August 2016.

Respondents were sourced from subscribers to Propertyvalue.com.au, OnTheHouse.com.au and via various call outs on social media. The survey examined attitudes and experiences of buyers who had successfully purchased (84% of those surveyed) as well as those who were still searching (16% of respondents). Respondents were overwhelmingly female (68%).

Each state was represented with the most responses received from buyers in NSW, Queensland and Victoria.

The majority of respondents (57%) had purchased within 12 months of filling in the survey with 22% buying between one to three years from the time of understaking the survey and just 6% purchasing more than three years ago.

Time of purchase/search was collected primarily to check their experiences of Buyers with agents were fresh in their minds at the time they filled in the survey.

Due to the extended collection period of the survey and size of the sample it was not possible to compare the time of searching against market conditions.

Note that in this report all responses are the combined totals of those who had successfully purchased and those who were still searching with the exception of chapter ten which examines those who were searching in greater detail.

Successful buyers represented 84% of responses.

03

15% 57%

22%

6

%

How long ago was your

property search?

Currently looking

Past 12 months

1 - 3 years ago

More than 3 years ago

Where buyers searched

36%

20%

29%

6%4%

1%

2%

2%


Buyer InsightsThe majority of survey respondents came from NSW (37%) followed by Queensland (29%) and Victoria (20%) but despite the differences in the property markets, the proportion of respondents who had successfully purchased versus still looking was similar across all states.

In NSW and Queensland, 83% had successfully purchased, while in Victoria the number was only slightly higher at 85%.

Upgraders represented 27% of respondents, followed closely by First Home Buyers with 26% and Investors with 25% of respondents. The remaining respondents were moving for Lifestyle reasons (10%), Downsizing (7%) or Moving for Work (5%). The overwhelming majority of those who had successfully purchased (91%) bought their property by private treaty with just 9% buying at auction.

Most respondents to the survey who successfully purchased took less than 6 months to find their property with 34% finding something to buy between three and six months, 26% finding a property to purchase in up to three months and 15% finding a suitable property in under a month. It took 14% of respondents about a year to

purchase and 11% took more than a year.

The number of properties inspected before purchase was fairly evenly split with 27% inspecting 10 to 19 properties before purchasing and 28% inspecting between five and 9. Twenty or more properties were inspected by 21% of purchasers, while 18% inspected between two and four and just 6% inspected only one property.

For those who were still searching, 40% have been looking for three months or less with 12% searching for about a month and 28% searching for up to three months. The survey showed 29% had been searching between three to six months, 12% had been hunting for around a year and 13% for more than a year.

04

What was the main reason behind your decision to buy a

property?

Upgrading

First Home

Investment

Lifestyle

Downsizing

Moving for work

27% 26% 25%

1

0%

7

% 5%

How long did you search for a property

to buy?

About a month

Up to 3 months

3 - 6 months

About a year

More than a year

“Our agent went above and beyond in the negotiating process to make both parties happy. It was difficult to please everyone but he got there in the end.” – Survey Respondent.

How many properties did you inspect before

you successfully purchased?

Just the one

2 - 4

5 - 9

10 - 19

20 or more

6% 18% 28% 27%

21

%

12% 28%

29%

1

7%

13%


“I researched the market over the 12 months while I looked and when I finally found the perfect property, I did my due diligence in knowing everything I could – previous sale prices and dates, spoke to the neighbours and agents who inspected the property and went as far as talking to the vendor. It took a lot of hard work and effort but it was worth it.” – Survey Respondent

The observation that buyers are doing more research and accessing data to better understand their target markets was borne out by the survey, which showed that 46% of buyers were using property reports with 28% obtaining one for free from a bank or mortgage broker, and 18% independently purchasing a report. Buyers in NSW were most likely to purchase reports with 23% going down this path compared with 16% in Queensland and 15% in Victoria.

The survey identified that buyers are hungry for knowledge with 90% of all respondents claiming they had looked online and in newspapers to see past sales in the area they were looking to purchase, and 68% saying they had read up on local market conditions. (Totals are greater than 100% due to multiple responses being

permitted for this question.) Receiving advice from family and friends is also popular with 48% claiming to have researched their local market in this manner.

The report also reveals the extent to which technology has disrupted traditional searching methods for property with 95% of property hunters using property portals such as realestate.com.au or domain.com.au to find a suitable property and 54% using a real estate agent website.

Newspaper property supplements were used by 33% of respondents while 38% used real estate agent emails and a further 33% saw the signboard or identified a property from an agent window. Social media was used by 14% of respondents to find their dream property. (Totals are greater than 100% due to multiple responses being permitted for this question.)

The degree to which real estate agents are helping buyers research their decisions however gives some insight into the gap between consumer and industry behaviour with one quarter (25%) or buyers saying they were offered no information from agents they dealt with.

Of those who did receive information from agents, 55% were emailed newsletters, 44% were given a flyer or brochure and 22% were directed to a website by the agent. Video was offered by just 7% of agents while 10% of agents invited buyers to connect on social media to find out more information.

Buyer Research05

What types of research have you done during your property search?

What sources have you used to find a property to buy?

90% Looked online/in newspapers to see past sales in my area

95% Property portal such as realestate.com.au or Domain

68% Read up on local market conditions

48% Spoke to friends and family

54% Real estate agent website

37% Real estate agent email

What information have agents you approached offered you to help your property search?

55% Property portal such as realestate.com.au or Domain

45% Brochures/flyers

25% Nothing

Are Buyers Smarter than Sellers?A comparison of the data between the Buyer Perception and earlier Vendor Perception reports, identifies that buyers are more likely to be better prepared than sellers and have done more homework.

The survey comparison shows that 11% of vendors purchased a property report when selling compared with 18% of buyers. Buyers were also more likely to seek out free reports with 28% agreeing that they had received a free report from their broker or financial institution, compared with just 15% of vendors.

Buyers were also more likely to do general homework and ask the opinions of friends and family. The comparison shows that 48% of buyers asked friends and family for advice while just 21% of vendors admitted to doing the same. 68% of buyers read up on local market conditions compared to 55% of vendors.


Buyer SatisfactionThe survey showed a significant difference between the satisfaction levels of buyers compared to the satisfaction levels of vendors from the previous survey with fewer buyers compared to sellers experiencing excellence from agents.

The 2015 Vendor survey showed that 66% of vendors rated their overall experience as positive with 31% claiming their experience with their agent was Excellent and 35% describing it as Good.

The experience of buyers however was not as encouraging with 58% rating it as positive and just a small proportion claiming it was excellent. Just 14% of buyers rated their experience as Excellent and 44% said it was Good.

On the opposite end of the scale, 43% said their experience was Average or worse with 29% claiming it was Average, 11% saying it was Poor and 3% describing it as Disastrous.

This compared to 34% of Vendors who described their experience as Average or worse where 20% of those selling described their experience as Average, 10% described it as Poor and 4% described it as Disastrous.

44%

Good

29%

Average

14%

Excellent

11%Poor

3%Disastrous

How would you rate your overall experience buying your property?

06

33%

Good

22%

Average

31%

Excellent

11%Poor

3%Disastrous

BUYERS

VENDORS

How buyers and vendors compare


Give a vendor a bottle of champagne to congratulate them on the successful sale of their home, and they are likely to see the gesture as the icing on the cake of a positive experience.

But give a buyer a similarly decent vintage at contract exchange, and while they’ll thank you, they’re more likely to take it in their stride. Perhaps it’s because they have just shelled out hundreds of thousands of dollars, rather than receiving a bonanza. Perhaps, it’s because the dollars involved for most represent a life of mortgage servitude. Or perhaps it’s because their participation earned you 2.5% even if they’re not paying you directly. But a bottle of bubbles in most instances is seen as the least you could do.

While buyers do not pay for the services of agents, the Buyer Perceptions of Real Estate Agents identified that buyers are a tougher bunch to please compared to vendors when it comes to delivering excellent service.Just 14% of buyers described their buying experience as Excellent, compared to 31% of Vendors and few buyers nominated gift baskets as the differentiator. In comparison, 44% of buyers described their experience as Good (compared to 36%

of Vendors), and many in this category identified that their agent had given them a gift. Rather, what stood out for buyers to determine excellence was the quality of the service they received from the agents they engaged with, with professionalism, market knowledge and excellent communication skills over and above a big marketing budget.

“The agent we bought from met with us at the properties after hours to accommodate my husband who works long hours, and worked through to late at night to put together our offer paperwork,” wrote one buyer. “She kept us up-to-date and informed with each step, and showed complete transparency. She was the complete opposite to what we experienced with the agent we first made an offer on a home with previously!”

Buyers valued agents who were prompt and responsive to their queries or special needs.

“Arranged open houses and after sale visits and inspections readily and quickly,” wrote one buyer who gave his agent an Excellent rating.

“The service overall impressed me,” wrote another. “He was very prompt at getting back to us and following up.”

“Always got back to me when promised. Very knowledgable and honest,” commented a fourth.

Buyers also rated communication and negotiation skills, identifying that those agents who were skilled in this area made them feel safe.

“She was always professional, friendly and not pushy,” wrote another respondent.“We always felt we were in good hands.”

They also highly valued agents who made themselves available and guided them through the process ensuring it all went smoothly. “Our agent was in constant communication and had wonderful negotiating skills,” wrote one buyer.

“He made himself available to answer questions and provided the sufficient detail to satisfy the banks requirements.”

Buyer comments from the survey identified that gifts for their own sake were not enough. But when agents got the communication, follow up and purchasing process right, gifts guaranteed clients for life.

“After purchasing the house, he surprised me with a carton of wine and keeping touch by sending mails and current market situations within the area,” said one buyer.“Negotiated the price well and once purchased he made everything run as quickly as possible to get us into the property. He even gave us champagne, chocolates and a gift bag!” wrote another.

Are Buyers Harder to Please than Sellers?

Just 14% of buyers described their buying experience as Excellent, compared to 31% of vendors and few buyers nominated gift baskets as the differentiator.



Agent Skill LevelsThe survey asked buyers to rate their experience of real estate agents across a variety of professional skills including their professionalism at open for inspections, post purchase follow through and the quality and accuracy of price guides.

The results provide telling indications that there is a significant mismatch between agent skills and buyer expectations and provide some of the strongest insights into where agents can lift their game.

The survey found the skill most likely to be rated as Excellent by buyers was Professionalism at Open for Inspections/Open Houses. Nevertheless, only 20% of buyers rated agents as Excellent at this skill, while 48% said they were Good and 25% rated them as Average. Professionalism however was the ‘least bad’ skill with just 5% executing it to a Poor degree and 2% reporting Disastrous levels.

The skill executed the most poorly by agents was Post Purchase Follow Through with 22% of Buyers describing this service as Poor and a further 11% claiming Disastrous – exactly a third of those surveyed. Only 15% of buyers described Post Purchase Follow Through as Excellent with

most tending to identify it as Good (25%) or Average (28%).

Price guides was also an area of disappointment to buyers with 18% claiming agents did this Poorly, and an additional 10% describing agents skill in this area as Disastrous. The majority of respondents (66%) claimed agents were Good (30%) or Average (33%) but only 9% said the agents they dealt with had Excellent skills in this area. Buyers lamented agents that failed to understand the value of quality price guides, claiming the wasted time and dishonesty amplified the profession’s reputation and created an environment of mistrust.

“Quoting $100,000 less than the purchaser wants for a property is dishonest and does not encourage a purchaser to trust an agent,” one wrote. “Agents need more empathy and honesty,” wrote another.

“They should stop lowering the price guide just to bring in more people as it’s really unfair and just ends up wasting everyone’s time.”

Buyers recognised that agents work for vendors and this was evident in the scores they gave agents in relation to their interest in their property search and the level of help that was offered to help them find a new property.

The majority of buyers (55%) had an Average (33%) or worse (Poor – 18%, Disastrous – 3%) experience with agents in terms of the level of interest that was exhibited in their property search,

while 46% of buyers had a positive experience with 34% describing that level of interest as Good and 12% describing it as Excellent.

Buyers lamented that only a minority of agents were genuinely helpful at finding them a suitable property to buy with just 9% rating the performance of agents in this area as Excellent and 23% describing it as good. The overwhelming majority of agents (68%) delivered Average (34%) or worse experience in this space. (Poor – 29%, Disastrous – 5%).

“Agents could at least return phone calls,” wrote one buyer. “I realise they are working for the seller and their own commission but considering the buyer is the one that is paying for the property, you think they’d at least make an effort to seem interested.”

The much vaunted skill level of agents as negotiators has also suffered a blow from Buyers with 41% describing it as positive (13% - Excellent, 28% - Good). Negotiation skills were described as Average by 29% of respondents and Poor or Disastrous by 24% and 6% respectively.

“We put in an offer and heard nothing,” wrote one buyer. “Then it sat on the market until it was reduced to a price that was lower than our offer – at which point I rang the agent. It would have been nice if they’d kept in touch. They’d have got more money for their vendor!”

07

“Agents should be honest about prices. We’d turn up for inspections of ‘offers over $350,000’ then be told the owner wouldn’t consider anything under $450,000. So many weekends wasted!” – Survey Respondent


Buyer comments on price guides

“Agents should be honest and accurate when talking about prices. Quoting $100,000 less than the purchaser wants for a property is dishonest and does not encourage the buyer to trust the agent.”

“Agents need to advertise price guides so I don’t waste time ringing agents all the time. It is very frustrating. They should also provide recent sales in the area – not just their own sales. I don’t care about what they sold.”

“Agents need to provide more accurate estimates of value because more than anything, this impacts the image of agents.”

Professionalism at Open for Inspections/Open Houses

20% Excellent

48% Good

25% Average

5% Poor

2% Disastrous

9% Excellent

30% Good

33% Average

18% Poor

10% Disastrous

Quality and accuracy of the price guides you

were given

9% Excellent

23% Good

34% Average

29% Poor

5% Disastrous

Helping you find a suitable

property to buy

13% Excellent

28% Good

29% Average

24% Poor

6% Disastrous

Negotiating the purchase

15% Excellent

47% Good

30% Average

6% Poor

3% Disastrous

Post purchase follow through

How would you rate your experiences of real estate agents in general during your property search?


Agent BehaviourThe survey showed that while the majority (61%) of buyers found the Friendliness and Empathy of the agents they dealt with was positive, only a small proportion (14%) rated it as Excellent with 47% rating it as Good. More than a third of the market however found there was room for improvement with 30% claiming it was Average and 6% and 3% respectively claiming it was Poor or Disastrous.

Buyers in general found that agents had very strong local market knowledge with 69% claiming their agent was Good (59%) or Excellent

(18%) in this regard. However, knowledge levels fell off somewhat when it came to individual properties with just 57% of buyers describing their agent as Good (45%) or Excellent (15%) and this was a source of frustration for many buyers. Buyers rated 31% of agents as Average at property knowledge while 6% said it was Poor and 3% Disastrous.

“Agents should have a checklist of all the basic questions that they will be asked including land size, recent renovation dates, what structural work has been done – I’m amazed that some agents don’t have this,” wrote one buyer.

“Agents need to have better knowledge about the property they are selling,” wrote another. “Most agents I dealt with had no idea about the building materials that were used on various property and even told me incorrect information.” The survey revealed however that where agents really fell down in the eyes of buyers was in their Response Time,

Follow Up and Honesty and Trustworthiness.

Just 9% of buyers rated Agents level of Honesty and Trustworthiness as Excellent, and 25% rated it as Good, making a total of just 34% claiming that the Honesty and Trustworthiness of agents was positive.

The majority of 66% described the Honesty and Trustworthiness of agents was Average (37%), Poor (17%) or Disastrous (12%).“Agents should be honest,” wrote on respondent.

“Buyers know that agents are working for the seller which will be us one day and then we’ll certainly want an agent who is working hard to achieve the best selling price. But calling a tired, old house “immaculate” and postage stamp gardens “huge” only alienates buyers. We eventually stopped viewing the listings of some agents as we were disappointed at every open home. They may have gotten a lot of people through but those same houses sat on the market

08

How did you rate the behaviours of agents generally that you interacted with during your property search across the following areas:

Positive Average Negative

Marketing materials quality

Agent knowledge

about the local market

Agent knowledge about the property

Friendliness and empathy

“Our agent was as good as his word. I didn’t feel like he tried to manipulate the situation. He was selling for the vendor – that was clear – but when I asked questions, he answered honestly and was always helpful. I felt comfortable with him in all aspects of the purchase. He was so much better than the agent I’d bought through 12 years ago who made me wary of all agents.” – Survey Respondent

61% 3

0%

9% 60%

31%

9% 69%

23%

8% 59%

32%

9%

Positive = Excellent + Good Responses Negative = Poor + Disastrous Responses


Follow up

much longer than those that were advertised honestly.”

Failing to follow up and do what the agent said they would do was a key irritant to buyers with less than half (42%) rating this behaviour as positive amongst the agents they dealt with during their buying journey. Just 11% of buyers ranked the follow up skills of agents as Excellent and 31% ranked them as Good. A much higher proportion (58%) said these skills were mediocre to poor with 36% claiming they were Average, 15% Poor and 7% Disastrous.

Slow response time was another major peeve for buyers with just 46% claiming to have had a positive experience in this regard with the majority of agents that they were exposed to. Just 13% ranked agents as Excellent in this field. The split between Good and Average was equal at 33% while 14% were Poor and 7% Disastrous.

“Agents need to return phone calls faster,” wrote one respondent. “While I realise they are working for the seller and their own commission, the buyer is the one who is paying for the property so they could at least make an

effort to seem interested.”Buyers also pointed out that failing to respond frequently disadvantaged vendors.

“I wish they’d stop with the “how much are you willing to pay – make me an offer,” wrote one. “You make an initial offer and then they never get back to you. Eventually you find out that the property sold for a price that was less than what you would have offered – if only they’d responded. It made me feel like contacting the vendors and telling them.”

Buyer comments on honesty

Agents should just be honest and list the property in the ballpark of what it is expected to go for. Don’t try and be clever. I can smell a manipulator and it really turns me off. I just like honest interactions and I like a person that just helps the process through smoothly. Most people don’t buy and sell that often so just help us understand the process and be honest.

Agents should be honest and genuine and treat it like they’re talking to a friend. While they are acting for the vendor in obtaining the best price, remember that the purchaser will also need the same service down the track and this could be a great partnership for future dealings.

Agents need to be honest and give accurate price guides. I hate how they fluff around and don’t answer questions properly. I wish they would not try to get me in with a lower price when they know that it’s going to go higher.

Honesty and trustworthiness

34% 37%

24

%

42% 36%

22%

Response time

46% 33%

21%


Specific vsGeneral Agent BehavioursOne of the hypotheses we wanted to test during the survey was whether successfully purchasing a property was likely to predispose buyers more favourably towards an agent.

We also wanted to explore what proportion of buyers purchased the property even if agent behaviour was suboptimal and the degree to which that behaviour coloured the buyer’s perceptions of agents. Did it make their perception worse or was it regarded as par for the course?

As such, we asked those who had successfully purchased to rank the key skills and behaviours of “agents in general” with whom they had interacted through their search. We then separately asked them to rank the key skills and behaviour of

the agent that they finally purchased through to compare the difference. The findings were telling.

The research showed that the service levels offered by the agent that they finally purchased from were more likely to be perceived by buyers to be superior to those they experienced in general while searching.

The survey found that on average nearly twice as many buyers ranked the skills and behaviours of the agent they finally purchased from as Excellent compared to agents in general.

09

“The agent we bought from went above and beyond to ensure I was kept in the loop with their processes and to make sure I had a good understanding of everything that was going on.” – Survey Respondent

Next time I will...The following comments are a selection made by survey respondents about what they will do differently the next time they buy a property.

“Go to open for inspections in the area and start assessing agents and how they interact with me.”

“Stick with the agent I now know and trust.”

“I will stand up for myself more. I am more familiar with the process now and I won’t allow a crappy agent not to do their job properly.”

“Network with more agents and try to forge stronger working relationships with them so as to hopefully create better opportunities and get access to properties before others.”

“Do more research.”

“I would call the agent we used to sell our house for his advice. He rang us by chance when we had already exchanged but still gave us a lot of insight and was very helpful despite having nothing to gain out of this purchase.


When it came to the behaviours of the individual agents that helped them purchase, buyers were between two to three times more likely to rate ‘their’ agent’s behaviour as Excellent compared to agents in general.

This supports the hypothesis that one of the most powerful things a selling agent can do to obtain new listings is to develop strong life-long relationships by looking after their current buyers.

How my agent performed

23%MY AGENT

13% THE REST

HELPING FIND SOMETHING TO BUY

20%MY AGENT

THE QUALITY & ACCURACY OF THE PRICE GUIDES

10% THE REST

23%MY AGENT

AGENT’S ABILITY TO NEGOTIATE THE PURCHASE

15% THE REST

22%MY AGENT

POST PURCHASE FOLLOW THROUGH

16% THE REST

33%MY AGENT

15% THE REST

FRIENDLINESS AND EMPATHY

35%MY AGENT

AGENT RESPONSE TIME

13% THE REST

24%MY AGENT

HONESTY AND TRUSTWORTHINESS

10% THE REST

30%MY AGENT

KNOWLEDGE ABOUT THE PROPERTY

13% THE REST


What Buyers Want

To be taken seriously – even if they look like

something the cat dragged in at an open

Realistic recommendations

of properties to view that will meet their

needs and are within their budget (even if you’re not the agent

selling them)

A heads up on issues with the property so that they can budget

accordingly for repairs

A transparent process – especially

around making offers and negotiating

Follow up calls to let them know what

else is available if they miss out on

the property they’re interested in

Prompt notification when things change without them having to chase down details

Recognition that they have just made one

of the most expensive purchases of their

lives

A relationship with an agent they trust that they can go to

when they are ready to sell or buy again


Hallmarks of Service Excellence

Always return calls – even after hours and be a proactive

communicator

Know the neighbourhood

and provide useful supporting information that is

emotional as well as transactional

Know the property intimately and

provide prompt and detailed responses to

queries

Have a transparent process and take time with buyers

Make buyers feel they are part of a

community

Pre-empt issues and identify how

you’ll solve them in advance

Demonstrate empathy and

thoughtfulness

Acknowledge the emotional

importance of the purchase


Cynicism Of Those Still SearchingThere is absolutely no doubt that strong markets, high prices and low affordability has now made the property buying game higher stress than ever.

The survey separated buyers who were still searching to understand whether successfully purchasing influenced the perception of agents. Response numbers were too low to identify any definitive observations that could compare length of time of searching to the degree of satisfaction, however the survey did identify that purchasers who were looking were likely to be more dissatisfied with agents than those who had successfully purchased.

Within the survey, 31% of respondents were enduring a long term search of about a year (18%) or longer than a year (13%). The survey found that 29% had been searching for 3-6 months, while 28% had been searching for two to three months and 12% had searched for about a month.

Just over 16% of respondents had looked at more than 20 properties as part of their search, 29% looked at between 10 and 19 and 26% inspected between five and nine properties. The survey identified that 22% had inspected between 2 to 4 while 7% had only just

commenced their search looking at one property.

Respondents who were still looking were significantly more likely to describe their experience of agent skills as Average or negative than those who had successfully purchased, and most of their outrage was directed at agent skills in quoting accurately with price guides which correlated to perceptions about honesty and trustworthiness.

The survey showed that 41% of respondents who were still searching rated the quality and accuracy of price guides given by agents as Average. This compared to a 32% Average rating for those who had successfully purchased. What is interesting about this comparison is that those buyers who had purchased who had not had an Average experience were more likely to rate agents Good or Excellent across the different skills. Those who were still looking who did not rank agents as Average were more likely to rate agents as Poor or Disastrous across the skills.

The survey identified that one of the most important areas that buyers – both successful and those still looking – believe agents need to do better is in quoting prices accurately. The power of poor price guides to irritate potential buyers was hammered home when looking at the Excellent ratings.

The survey showed that while just 10% of buyers who had successfully purchased rated the ability of agents to quote accurately as Excellent, this number slumped to just 2% of

those who were still looking.“Agents need to stop giving buyers false hope by under-estimating the price guides,” wrote one respondent. Requests for agents to be honest about quoting prices and calls for transparency around pricing were persistent across the survey.

There was a correlation between accurate pricing and honesty. The survey showed that 40% of those who were still searching described agents’ honesty and trustworthiness as Average, compared to 37% of those who had purchased.

But those still searching were more likely to describe the honesty of agents as negative (38%) compared to those who had purchased (27% negative). Just 22% of those who were still searching described agents’ honesty and trustworthiness as Excellent (4%) or Good (18%) compared to 37% for those who had already purchased with 10% Excellent and 27% Good.

*Note - all figures quoted in this section represent responses from buyers who were still searching.

10

“There seems to be two types of agents; ones that won’t leave you alone and you feel smothered, then others that hang back and can’t be bothered.” – Survey Respondent


BUYERS WHO HAD PURCHASED BUYERS WHO WERE LOOKING

Professionalism at Open for Inspections 70% 6% 59% 14%

Quality and accuracy of price guides given 42% 26% 21% 38%

Helping you find a suitable property to buy 35% 33% 20% 38%

Negotiating the purchase 45% 27% 18% 42%

Post purchase follow through 43% 32% 14% 39%

Friendliness and empathy 63% 9% 51% 9%

Agent knowledge about the property 57% 11% 59% 13%

Agent knowledge about the local market 70% 7% 62% 10%

Marketing materials 60% 10% 54% 13%

Follow up: doing what they said they would do 44% 19% 32% 36%

Response time: getting back to you quickly 49% 18% 31% 35%

Honesty and trustworthiness 37% 27% 22% 38%

“They were not overly pushy and they returned our calls promptly. He was very honest about issues with the house which helped immensely when we took ownership – there were no surprises and it allowed us to plan for the rectification work.” – Survey Respondent

Positive = Excellent or Good

Negative = Poor or Distastrous


Buyer Recommendations & Repeat BusinessOne of the key findings to come out of the survey is the value that comes from looking after buyers and delivering a quality service to them.

The survey showed that of those buyers who had successfully purchased, listing business was likely to

come from 63% of them - with 25% claiming they would definitely use the agent they had purchased from to sell their home and a further 38% stating that he or she would be on the shortlist of agents they would consider.

However, the survey also showed the high levels of churn that agents experience, predominantly as a result of their own behaviour with 20% of buyers saying they probably would not use the agent they had purchased from and 17% claiming they would definitely not use him or her again.

The survey also identified that buyers have the opportunity to become a formidable force of referrals for agents who are smart

about how they cultivate their networks. The survey showed that 57% of buyers would recommend the agent they finally bought from to family and friends. On the flip side, 43% of buyers would not recommend their agent.

Staying in touch in a meaningful way with buyers is key to retaining long term relationships and winning listings from them in the future. The survey showed that 25% of buyers expected to stay in touch with the agent they had purchased through with an additional 32% stating that they might (if the agent made the effort). However 43% of respondents said they did not expect to stay in touch with their agent.

11

Would you use the agent you

purchased your property from to sell your property

in the future?

Yes, absolutely

Possibly

Probably not

Absolutely not

Do you expect to stay in touch with

the agent you bought fromor use him or her again?

Yes

Maybe

No

“Our agent followed through with everything he said. He left the keys tied to a lovely box with a beautiful set of Sheridan towels. He lives around the corner, so he popped in a few weeks later to check in on us. We still see him and his family around and have a chat. He’s since sold three houses in our street for record prices.” – Survey Respondent.

25% 38%

20

%

17

% 25% 32%

43%


The following behaviours experienced by buyers were virtual guarantees the relationship would be ranked Average to Disastrous and were roadblocks to a future relationship.

Behaviours that Alienate Buyers Failing to advertise

prices or provide any realistic price guidance leading to buyers attending unsuitable open for inspections

Wasting buyers time by sending them to properties that were blatantly unsuitable

Advertising open home inspections when the property is under offer

Failing to return phone calls during a negotiation

Buyer beware behaviour by hiding faults and failing to respond to defects

Poor post sale experience by making buyers collect their own keys or ignoring issues where properties were left in a poor condition by the vendor


Will your buyer want to stay in touch? One of the sentiments the survey revealed was that when the post negotiation period through to settlement is managed well, buyers welcome the idea of staying in touch with their agent.

This in turn correlates with buyers calling the agent-they-bought-from first when it comes time to sell their property. It also makes them more likely to recommend ‘their’ agent to friends and family. This can be a powerful source of business for agents with the Vendor perceptions research identifying that 36% of vendors chose their agent because he or she was recommended by a friend or family member.

But equally those agents who botch the post negotiation period are unlikely to ever get another look in and commentary from survey respondents identified that poor follow up service is prevalent in the industry.Many buyers complained that they felt dumped by

their agent the minute the offer was accepted. Many complained about needing to chase agents for information about settlement which added to stress when mortgage and financial institutions were involved.

“There needs to be quality after purchase service,” wrote one buyer. “We purchased a $900,000 house and had to chase the agent for details about settlement the entire way. We then got the key to our house on a plastic key-ring. It was not okay.”

“Our agent ignored phone calls and emails because he didn’t want to answer questions, which we felt put him into the dishonest category,” wrote another. “We had a very long settlement and it got put back twice but we received no notice – not even a phone call!”

Other complaints included agents continuing to advertise the property post offer acceptance or failing to remove signboards promptly.

But agents who handled the post purchase period professionally were more likely to receive Excellent ratings from their buyers.

“Our agent went to extra lengths to make sure that the settlement and exchange went through smoothly,” wrote one buyer when asked to identify what impressed

about their agent’s service.

While many buyers remarked that they had received a gift from their agent, most commented that they appreciated these because it showed their agent recognised the importance of their new purchase, more than the dollar value of the gift.

Even things as simple as phone calls of congratulation upon settlement or framed photos of families on purchase days were valued by buyers because they showed the agent was genuinely interested in a connection.

The Power of Follow Up

“Our agent organised a pre-inspection before we moved in.” “He arranged for the vendors to be there and they ran us through all the gadgets in the house so we’d know how they worked.”



There were differences in the Buyer Perception survey and some of its questions when compared with the Vendor Perceptions survey. This was necessitated by the need to recognise the different ‘journeys’ of vendors and buyers and survey refinements to improve clarity and response capture.

Nevertheless, there were more than enough data points on key topics to allow direct comparisons on key behaviours, experiences and the skill levels of agents, which in turn has allowed us to identify the similar expectations of Buyers and Vendors.

The survey found that while similar proportions of Buyers and Vendors were likely to have negative experiences across key behaviours, Vendors were more likely to have had Excellent experiences compared to Buyers who were more likely to have had Average or just Good experiences.

This was marked in that while approximately one third (33%) of Vendors experienced Excellence across most of their agent behaviours and skills, an average of only 14% of Buyers experienced Excellence.

The area where Buyers and Vendors were most closely aligned was on the issue of Professionalism at Open for Inspections with 68% of Buyers and 67% of Vendors stating that their overall experience was positive.

A comparison of the two surveys shows that while 36% of Vendors expect to stay in touch with their agent, this feeling is reciprocated by just 25% of Buyers.

Equally, while 68% of Vendors would recommend their agent, just 57% of Buyers would do the same.

How Buyer & Vendor Perceptions Compare

Excellent experience comparison

18%BUYERS

40% VENDORS

MARKET KNOWLEDGE

11%BUYERS

FOLLOW UP

33% VENDORS

13%BUYERS

NEGOTIATION SKILLS

28% VENDORS

12%BUYERS

RESPONSE TIMES

35% VENDORS

30%BUYERS

MARKETING QUALITY

12% VENDORS

Stay In Touch

36% YES

VENDORS

32% NO

25% YES

BUYERS

43% NO

Recommend Agent

68% YES

32% NO

57% YES

43% NO

VENDORS

BUYERS

12

The proportion of buyers and vendors who rated agents as excellent


The true surprise of the Buyer Perceptions survey was just how similar the concerns of buyers are to the concerns of vendors - and how simple it is for agents to address these.

The research identifies that the behaviours and skills that buyers see as being hallmarks of Excellent service are the same as those identified by vendors. Both vendors and buyers want good communication, help, empathy, fast response times and a transparent process from end to end that recognises both the emotional and financial enormity of buying and selling property.

The only difference is the degree to which buyers are likely to experience Excellence – which the survey identified was less than half as likely as vendors. Indeed, an average 14% of Buyers experience Excellence across the key skills and behaviours of agents with most relegated to average experiences.

The survey shows that buyers understand agents are there to serve the vendor and as they do not pay an agent, they have limited power to demand better treatment. But it also reveals how genuinely confused they are as to why so many agents –

always on the hunt for their next listing – just don’t seem to comprehend that good service creates referrals and new business.

The survey delivers some extraordinary insight into the depth of feelings that buyers have around the legacy method of selling property, based as it is in opaque processes and complicated negotiations. Comments in the survey identify the frustration so many feel and how they are no longer prepared to be silently mystified – especially when they are the ones spending many hundreds of thousands of dollars. Agents who seek to defend or propagate these methods are most likely to be labelled Poor or Disastrous by buyers.

Inevitably, it is agents who are the losers in this scenario. Only 25% of Buyers expect to stay in touch with the agent they bought from, and only 57% would recommend their agent to friends of family. These figures start to identify the extraordinary client ‘churn’ rate that so many agents tolerate by turning their back on buyers while simultaneously chasing their next listing elsewhere.

The survey confirmed the insight extracted from the

Vendor report that buyers are assessing and ‘auditioning’ agents from the minute they meet the agent – usually at the first open for inspection. As such, it is the way agents treat buyers is a critical decider in whether the agent will ever get an interview and opportunity to pitch for the client’s business when they make the decision to sell.

But equally, the survey reveals the extraordinary opportunity agents have every time they hold an open for inspection. When an agent delivers a quality service to a buyer, three things happen – they are extraordinarily grateful, they become a client for life and they tell all their friends. This makes buyer-care one of the most powerful and affordable – yet undervalued assets - any real estate agent can own.

To this end, the survey confirms the view that the sales funnel for real estate agents is significantly larger than the majority of agents realise. It confirms that those who expend their energy and training on improving conversion rates of vendors, are focusing on the wrong end.

Providing an excellent experience for buyers can add significant numbers of genuine future sales opportunities when managed correctly. While the immediate financial pay off for agents comes from vendors, having a process for supporting and helping buyers can become a highly valuable asset that sustains the economic growth of a successful real estate business.

Conclusions13

“At the end of the day, the agent works for the seller – but treating the buyer as a client as well can only help grow their business.” – Survey Respondent

General Advertising & Sponsorships

Listings Advertising

Open for Inspections/Potential Buyers

Agent Website

Client Referral

Vendor Pitch

Service Delivery

AWARENESS

NEED FULFILMENT

DECISION CONFIRMATION

VALIDATIONPO

INT

AT

WH

ICH

CLI

EN

TS IS

IN A

GE

NT

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ATA

BA

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New Model: Role of buyers inlead generation funnel


What Agents Did WellQuotes from buyers

“He had a good knowledge of the neighbours, their names and jobs and made us feel comfortable about the neighbourhood.”

“She knew the ages and the schools the kids in the street went to which was personal and allowed us to know it was a good fit for our family.”

“Our agent was very knowledgable and honest and always got back to me when promised.”

“Constant communication and wonderful negotiating skills.”

“Our agent provided information about the local council, businesses, local schools and public transport.”

“Our agent was patient with my lack of knowledge and they educated me about the process.”

“She kept me up to date throughout the negotiation stage and answered any questions before and after settlement.”

“To be totally honest I was just impressed with the service they provided and the fact they got back to me when I made initial contact as so many agents didn’t.”

“Our agent gave us multiple access times to review the property and detailed responses to questions.”

“Our agent was very supportive to both us as buyers and the seller. He took a photo of us all together and sent us a professional document with photos and congratulations. It was a good experience for both parties.”

“Constant communication and wonderful negotiating skills.”

How agents can be honest with buyers – without undermining their loyalty to the vendor

Listen to what the buyer is looking for and make viewing recommendations based on what you know is on the market, not just on your books

Provide lists of comparable sales rather than price guides so that buyers can make informed judgments about what to offer

Be flexible on viewing times to accommodate genuine but time challenged buyers

Provide vendor approved quotes for repairs or remediation work on properties with issues so that buyers go in with their eyes open

Respond quickly to inquiries and requests for further detail

Know the property inside out including building materials, block size, renovation dates, rates, strata fees (if applicable) and running costs and have these available at opens.


Kylie Davis

The Author

Follow her on:

kyliecdavis

@KDavisCoreLogic

[email protected]

Kylie Davis is Head of Property Solutions Marketing at CoreLogic, responsible for content, social, and go-to-market strategies. She has a 25-year career as a content marketer, editor and entrepreneur and has held executive editor roles at both Fairfax Media and News Corp.

Prior to joining CoreLogic, Kylie was National Network Editor of Real Estate at News Corp responsible for the data-enabled editorial strategy that played a critical role in turning around the print publication losses in real estate. At 25, Kylie was founder of hyper-local newspaper The Village Voice, growing it to 3 newspapers over 10 years before selling. Kylie has an MBA (UNSW).

About CoreLogicCoreLogic is the largest and most comprehensive provider of property information, analytics and property-related risk management services in Australia and New Zealand.

We have more than 17,000 customers and 150,000 end users including, finance and real estate professionals, mortgage brokers, banking, valuers and corporate and government bodies, including some of the country’s biggest policy and decision makers.

Previously known as RP Data, our combined databases cover the entire property lifecycle – from zoning to planning, design and construction, sale, lease, re-sale and demolition – across both residential and commercial properties. We have more than 660 sources of data which are received from a combination of public, contributory and proprietary data sources suppliers. CoreLogic is the only independent data company in Australia not owned by any real estate, media or banking interests.

www.corelogic.com.au

Documents

Buyer Perceptions for Real Estate Agents 2016 FINAL