2012 Survey of California Home Sellers

Methodology

Telephone surveys conducted in August/September of 600 randomly selected home sellers who sold in the past 6 months. (2011 study surveyed sellers who sold in the last 3 months.)

Maximum sampling error: ±4.1 percent at two standard deviations (a 95% confidence level). (Subsets of the total sample will have a higher sampling error.)

ABOUT THE SELLER

The Typical Seller

58% female

37 years old

35% white

47% married

93% household income >

$75k

57% 1st-time seller

Majority of Sellers are Females

Male 42%

Female 58%

Females Hold Majority

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

43% 38% 35% 36% 37%48%

40% 40% 42% 43% 42%

57% 62% 64% 64% 63%52%

60% 60% 58% 57% 58%

Male Female

Q: Your Gender

Median Age: 37

35%

39%

12%

4%

11%

25-3435-4445-5455-6465+

Q: What is your age?

Sellers Are Getting Younger

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

5

10

15

20

25

30

35

40

45

50

Median AgeAverage Age

Q: What is your age?

Gen X and Y Dominate Seller Population

2006 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Gen Y (1980-1999) Gen X (1965-1979) Boomers (1946-1964) Seniors (before 1946)

Q: What is your age?

Minorities are the Majority

35%

26%

27%

12%

WhiteHispanicAsianAfrican American

Q: How would you describe your ethnic background?

Ethnic Background

20022003

20042005

20062007

20082009

20102011

20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

OtherBlackAsianHispanicWhite

Most Sellers are Married

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

24%13%

39% 37% 36% 30% 34% 37% 35% 32% 33%

76%87%

61% 63% 64%

53% 50% 48% 50%46% 47%

17% 17% 16% 16% 22% 20%

Single Married Other

Q:What was the marital status the head of your household at the time of the sale?

Household Income

2% 5%

31%

33%

17%

13%

< $50,000$50,000-$74,999$75,000-$99,999$100,000-$149,999$150,000-$199,999$200,000+

Q: Which of the following categories best describes your total annual household income from all sources?

Annual Household Income

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%

10%20%30%40%50%60%70%80%90%

100%

< $50,000 $50,000-$74,999 $75,000-$99,999$100,000-$149,999 $150,000-$199,999 $200,000+

First-time Sellers on the Rise

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

Q: Was this your first experience in selling a house?

Affordability Problems is #1 Reason for Selling

Q: Why did you sell your home?

Price decline concern

Desired smaller home

Moved out of state

Job loss

Low prices allowed upward move

Job change/relocation

Possibility of interest rate rise

Under water

Job/income uncertainty

Affordability problems

0% 10% 20% 30% 40% 50% 60%

1%

2%

3%

3%

4%

4%

4%

7%

17%

58%

*Affordability problems include: couldn’t afford mortgage, moved to less expensive market, loss of household income, income not keeping up with expenses, monthly payment went up, new job paid less, needed to move to less expensive residence.

Most Sellers Currently Rent

Own 47%Rent 53%

Q: Do you own or rent your current home?

Fewer Sellers Renting

2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

55%42%

12%

47%

45%58%

88%

53%

Own Rent

Majority of Sellers Moved Out of State

Q. County in which home was located. In which county is your current residence located?

From To

52%33%

28%

15%

19%

9%

44%

SoCal NorCalOther CA Another State

More Sellers Moving out of State

2004 2005 2006 2007 2008 2009 2010 2011 20120%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Sellers Not Optimistic About Future Home Prices

1 Year 5 Years 10 Years0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

69%57%

31%

23%32%

32%

9% 12%20%

0.17

Down Flat Unsure Up

Q: Do you think home prices in your neighborhood will go up, down, or stay flat?

Sellers Optimism About Future Home Prices Over the Years

In 1 Year In 5 Years In 10 Years

9%12%

20%

13% 14%

26%

16%

20%

35%2012 2011 2010

Q: Do you think home prices in your neighborhood will go up?

ABOUT THE HOME

Average Home is 21 Years Old & 2,600+ Square Feet

Single-family detached47%

Condo/Townhome54%

Q: What type of home was it?

Average Type of Home over the years

20022003

20042005

20062007

20082009

20102011

20120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Condo/TownhomeSingle-family Detached

Average Sale Price is 6% Lower than the List Price

Average$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$378,855$356,727

ListSale

Q: What was the initial listing price of your home? Selling price?

Average Listing Price vs. Average Sale Price

2009 2010 2011 2012 $300,000.00

$310,000.00

$320,000.00

$330,000.00

$340,000.00

$350,000.00

$360,000.00

$370,000.00

$380,000.00

$390,000.00

$400,000.00

Listing Price Sale Price

Percentage Difference of Average Sale Price vs. Listing Price Over the Years

2009 2010 2011 20120%

2%

4%

6%

8%

10%

12%

14%

THE SELLING PROCESS

Average Home Owner Considered Selling More than a Year Before Actually Doing So

Q: How long did you consider selling before actually doing so?

2 3 4 5 6 8 10 12 16 24 360%2%4%6%8%

10%12%14%16%18%20%

2% 2%

7%

2%

8%

19%

12%

19%

3%

11%

16%

Months

Average Months Owner Considered Selling Home in the Past

2011 201213.5

14.0

14.5

15.0

15.5

16.0

16.5

17.0

Most Important Websites for Sellers

Q: What was the single most important web site you used in your home selling process?

Most Important Websites for Sellers (Top 3)

2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

Realtor.comZillow.comYahoo! Real Estate

Nearly All Homes Were Listed on MLS

Listed97%

Never went on mkt2%

Private sale1%

Sold to relative0.2%

Q: Was your home listed on a multiple listing service? If no, why not?

Most Escrows Don’t Close on Time

2004 2005 2006 2007 2008 2009 2010 2011 20120%

10%20%30%40%50%60%70%80%90%

100%

Yes No

Q: Did your escrow close on time?

Most Escrows Don’t Close on Time Due to Loan Problems

29%

• Trouble with buyer loan approval

23%

• Loan didn’t fund on time

23%

• Last minute lender requirements

16%

• Lender didn’t approval terms

12%

• Paperwork not completed on time

Q: Why did your escrow not close on time?

More than Half of Homes Fell Out of Escrow at Least 3 Times

1 2 3 4 5 60%

5%

10%

15%

20%

25%

30%

35%

23%

16%

34%

13%9%

5%

# of Times Home Fell Out of Escrow

Q: How many times did your home fall out of escrow?

83% of Sellers Received at Least 2 Offers

1 2 3 4 5 6 7 8 9 100%

5%

10%

15%

20%

25%

30%

35%

40%

45%

17%

40%

23%

4%2% 2% 2% 1%

4% 5%

Q: How many offers did you receive from buyers?

What Sellers Would Change About the Sale

Q: If there was one thing you could change about your recent home sale, what would it be?

Sell for higher price (37%)

Sell faster (34%)

Market property more aggressively (10%)

Improve agent communication (9%)

Have agent negotiate harder (6%)

SELLERS WORKING WITH AGENTS

¾ of Sellers Found Agent Online

Q. How did you find your real estate agent?

Previous client

Farming material

"For Sale" sign

Referral

Internet

0% 10% 20% 30% 40% 50% 60% 70% 80%

3%

4%

8%

10%

75%

¾ of Sellers Interview at Least 3 Agents

1 2 3 4 5 60%

5%

10%

15%

20%

25%

12%13%

21%

24%

17%

12%

Q: How many agents did you interview prior to selecting the agent you used in your recent home selling process?

Sellers Interview More Agents

2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

1

2

3

4

5

6

7

2 2

3

4 4

5

6

5

3

4

Median Average

Q: How many agents did you interview prior to selecting the agent you used in your recent home selling process?

Reason Seller Selected Agent

Q: What was the single most important reason for selecting the agent you used in your recent home sale?

1st to respond (26%)

Appeared most responsive (25%)

Appeared most aggressive (19%)

Most qualified (6%)

Negotiation skills (5%)

More than Half of Sellers Google their Agents

2012

0%

10%

20%

30%

40%

50%

60% 52%

Q: Did you Google your agent?

More than ¾ of Seller Agents are REALTORS®

REALTOR®77%

Non-REALTOR®16%

Unsure7%

Q: Was your agent a REALTOR®?

7 out of 10 Gen Y Sellers Initially Listed their Home With Another Agent

0%

10%

20%

30%

40%

50%

60%

70%

0.440.51

0.360.32

0.390.33

0.7

Q: Did you initially list your home with an agent other than the one with whom you sold it?

More Sellers Initially Listed Home With Another Agent

2009 2011 20120%

10%

20%

30%

40%

50%

60%

70% 64%

22%

44%

Q: Did you initially list your home with an agent other than the one with whom you sold it?

1/3 of Sellers Changed Agents Due to Home Taking Too Long to Sell

Q: Why did you start with one real estate agent and change to another?

Took too long to sell (34%)

Not skilled in short sale negotiation

(32%)

Poor communication

(24%)

Response Time is Most Important in Agent Selection

Category 2011 2012

First agent to respond to my inquiry/quickest response time 4.2 4.3

Agent offered the best deal, lowest commission rate 4.1 4.3

Agent offered best marketing proposal 4.1 3.9

Agent was a REALTOR® N/A 3.8Agent was the most knowledgeable in the market area where the property was located 3.8 3.8Agent's knowledge of handling foreclosures, short sales, other distressed properties 2.9 3.0

Agent was referred by relative/friends/co-workers 3.1 2.9

Q: Please rate the following factors by their importance in your decision on selecting the agent you used for your home selling process on a scale from 1 to 5, where 5 is “Extremely important” and 1 is “Not at all important”.

Agent Satisfaction Ratings Relatively Unchanged

Category 2011 2012

Marketing the home 3.6 3.4

Setting the price 3.4 3.3

Preparing the home for sale 3.1 3.2

Assuring the buyer is qualified 3.1 3.0Value received for what you paid your real estate agent 3.1 3.0

Negotiating the transaction 3.0 3.0Overall satisfaction with the real estate agent 2.8 2.8Overall satisfaction with the home selling process 2.6 2.5

Q: Please rate your degree of satisfaction with your agent for each of the following aspects on a scale of 1 to 5, where 1 is least satisfied and 5 is most satisfied.

Seller Satisfaction Declining

2004 2005 2006 2007 2008 2009 2010 2011 20120.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Agent Selling process

Seller Satisfaction with Agent is Correlated to Sale Price

Q: Please explain why you had that level of satisfaction with your agent.

1. Negotiated good deal (74%)2. Got best price (50%)3. Listened to needs (35%)

1. Didn’t get desired price (91%)2. House took too long to sell (64%)3. Ineffective communication (20%)

Communication

Most Sellers Used Social Media

2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

80%

24%

77% 74%

Q: Did you use social media in the home selling process?

Agent / Seller Communication Gap in Telephone & Text Message

E-mailIn-perso

nText m

essageTelephone

47%

7%

33%

13%

51%

5%

1%

43%

Preferred Actual

Q: What was the actual method of communication used most frequently with your agent?

Q: What was your preferred method of communication with your agent?

The Communication Gap Widens With the Generations

PreferText Msg

ActualText Msg

Prefer phone

Actual phone

Prefer in

per-son

Actual in

per-son

Prefer email

Actual email

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

Gen YGen XBoomersSeniors

Q: What was the actual method of communication used most frequently with your agent?

Q: What was your preferred method of communication with your agent?

97% of Sellers Expect Response Within 1 Hour

Instantly

With

in 30 Minutes

With

in 1 Hour

With

in 2 Hours

With

in 4 Hours

Same day

1 business

day

> 1 business

day0%5%

10%15%20%25%30%35%40%45%

11% 13%

4%

25%28%

12%5%

2%

45%

32%

20%

2% 1%

Actual Expected

Q: On average, what was the ACTUAL time of your agent to return any form of communication to you?

Q: What was the typical response time you EXPECTED from your agent to return any form of communication with you?

2003 2004 2005 2006 2007 2008 2009 2010 2011 20120%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%45%

Q. What was the typical response time you expected from your agent to return any form of communication to you?

More Sellers Expect Instant Response from Agent

Seller Advice to Agents

71%

• Sell home faster

55%

• Improve communication speed

43%

• Negotiate more aggressively

34%

• Improve communication quality

23%

• Price home to sell from start

Q: What advice would you give to real estate agents to improve the process or level of service?

FINANCING

Most Sellers had Non-traditional Loans

FRM 29%

ALTA stated income 28%

ARM 18%

Interest-only 11%

No financing 8%

Negative amortization ARM 6%

Q: What type of mortgage did you have?

Fewer Sellers Had Adjustable Loans

20082009

20102011

2012

0%10%20%30%40%50%60%70%80%90%

100%

ALTA Stated Income ARM Interest Only FRM No Financing Negative amortization ARM

Q: What type of mortgage did you have?

More Sellers Tap Into their Home Equity

2009 2010 2011 20120%

10%20%30%40%50%60%70%80%

27%32% 31%

79%

Cash-out Refinance

Q: At the time of your home sale, was any portion of your outstanding mortgage balance due to a cash-out refinance?

More Sellers Considered Strategic Default

2011 20120%

10%20%30%40%50%60%70%80%

35%

74%

Considered Strategic Default

Q: As you may be aware, some home owners decided to stop paying their mortgages because their home value was lower than the balance on their loan. This is known as strategic default. Did you consider a strategic default?