David Lereah, NAR's chief economist, said ... "In finding a home, most home buyers begin the search process online, but most often learn about the home they buy from a real estate agent. Even though many other buyers are first learning about the home they buy online, they're still purchasing though an agent - they value the skills professionals bring to the table."
Most sellers prefer full-service brokerage, where professionals handle all aspects of the transaction process from listing to closing, including preparation of the home for sale, pricing, marketing, showing the home, contract negotiations and closing.
The median home price for sellers who use an agent is 31.9 percent higher than a home sold directly by an owner; $247,000 vs. $187,200.
Did you get that? 31.9% HIGHER
In the 2005 survey, the price difference was 16.0 percent, but the differences in location, housing type and seller income between homes sold by an agent and those sold directly by an owner were insignificant. This implies the price difference reported in the previous survey is more representative for fairly comparable properties.
The most difficult tasks reported by FSBOs are preparing the home for sale, understanding and performing the paperwork, and selling within the desired time frame.
Resoureces Used by Buyers
Buyers used a wide array of resources in searching for a home: 85 percent used a real estate agent, 80 percent the Internet (up from 77 percent in 2005), 63 percent yard signs, 55 percent print or newspaper ads and 47 percent attended open houses. Smaller categories include a home book or magazine, home builders, television, billboards and relocation companies.
In order of priority, home buyers want agents to help find the right house, negotiate the terms of the sale, determine what comparable homes were selling for, help with price negotiations, help with paperwork, help determine how much they could afford and help with finding and arranging financing. Three-quarters of buyers use only one agent in the search process.
Benefits of Using An Agent
When asked about the benefits provided by an agent, 55 percent of buyers said agents helped them understand the process, 40 percent said their agent pointed out unnoticed features or faults with the property, 37 percent indicated the agent improved their knowledge of the area, 36 percent said agents negotiated better contract terms, 35 percent reported a shortened search process and 29 percent said their agent negotiated a better price. Other benefits mentioned include narrowing or expanding the search area, providing a better list of mortgage lenders and providing a better list of service providers.
Ninety percent of sellers were satisfied with the selling process.
NAR mailed an eight-page questionnaire in August 2006 to a national sample of 129,500 home buyers and sellers who purchased their homes between July 2005 and June 2006, according to county records. It generated 7,548 usable responses; the response rate was 6.3 percent. All information is characteristic of the 12-month period ending in June 2006 with the exception of income data, which are for 2005.
Note from Jared
While this information is not available on a local level, one may apply the national trends to the local market conditions. See "Profile of Local Market Activity" at www.JeffCityMLS.com. Additionally, this is an abbreviated version of the NAR research with some unrelated information (eg. age and income demographics deleted) plus some emphasis added. For additional information and analyis, click the Talk To Me Now Button or Email me at Jared@JaredDollar.com