Over the past two years, Builders Digital Experience has conducted extensive home shopper research in conjunction with our Start Fresh. Buy New. initiative to help builders understand what motivates, inspires and leads shoppers to take action. This year, we expanded our study to not only include shoppers, but also consumers who bought a home in 2013, to learn about their buying and/or shopping process and what they think about new construction vs. resale.
Prospective Home Shoppers
53% of shoppers are considering new construction over resale as they begin their home search. This number has increased by 3% over the past year. To put this into perspective, if just 3% of these people bought a new truly home, it would mean 126,277 new homes across the country and $30 billion worth of business for builders. What a tremendous opportunity for the home building industry!
Increases in income, favorable home prices and simply being tired of their current home all play large roles in triggering the home shopping process. But don’t think that the process will be a short one. We’ve found again that the buying cycle is getting longer. More than two-thirds of shoppers plan to take 9 months or more before making a purchase decision. This makes lead nurturing critical to your marketing efforts so be sure to consider a steady stream of communications to send to your prospects.
What are these shoppers looking for in a home? Quality construction, safer neighborhoods, better floor plans and lower maintenance costs are top purchase considerations so be sure to emphasize these features in your marketing materials. Consider removing rooms people don’t use from your floor plans and add that space into places where they spend the most time, such as a separate media room or into a larger master suite or closet.
Real Estate Agents
You may be surprised that 48% of agents across the country prefer selling “New” homes but often feel it is hard to learn about new properties, inventories and promotions. Agents crave information, and before they bring a buyer to your community, they want to understand your commission policy. Publish your policy on both your website and your listings, and when possible, make sure you include buyer registration guidelines and standard commission percentages.
By keeping your listings up to date with this information, an agent is more informed and knows what to expect when working with you. This transparency will both endear you to agents in your market and get their buyers into your sales office.
Recent Home Buyers
We are losing 34% of shoppers who actually prefer new construction to resale. We call this group the “lost shoppers”. Why is this happening? We all know all of the benefits a new home provides versus a resale. But some consumers have concerns and doubts about quality of construction, neighborhood safety and the price tag of the home. A house is the biggest purchase a person will ever make and they want to be confident in the decision they have made for years to come. Alleviate their doubts by highlighting building certifications and standards you build to (i.e. LEED, Energy Star, local building requirements) as well as nationally recognized professional designations you have and professional associations your belong to.
Include a Quality Built section on your website that explains your company’s beliefs in building a quality product, warranties you provide, safety features and product lines that are used in your homes. A Frequently Asked Questions document explaining the building process, what to expect and local statutory requirements will help educate shoppers and build trust with you and your company. Also, reiterate the low costs of living and hassle free lifestyle that comes with a new home.
Over two-thirds of these “lost shoppers” say that the national real estate sites were their most trusted resources for finding a home but local sites also play a huge role. So if you want to convince this group of shoppers to buy new, advertise where they spend time…on real estate sites such as New Home Source, Move New Homes and realtor.com®, to name a few!
We found that buyers also relied heavily on real estate agents with 86% of ALL recent buyers using one. One thing “lost shoppers” have in common is that 91% of them used an agent. Knowing this, it is important to build strong relationships with your local agents as it will help you convert “new preferers” to “new buyers”.
These insights are just the tip of the iceberg. We have a full suite of research resources and tools that are available for our clients and are happy to talk with any builder about how this information can shape your business. For more information, contact BDX at Info@theBDX.com.