12 Stats Realtors & Lenders Better Understand About How Customers Buy & Finance Homes Now
I’m doing some work this week on the changing nature of lender and realtor relationships, and of course this is happening because consumer habits are changing.
REALTOR VOLUME (NAR):
-6.12m homes sold in 2017 (5.51m existing & 612k)
-2 sides per sale (buy side and sell side) is 12.24m sides
-2m active RE licenses means realtor averages 6 closings a year
Lenders trying to build technology to support realtor relationships should understand that, with average volume this low, you can’t expect realtors to come to the technology. The technology must come to them.
DIGITAL/LOCAL SERVICE:
-72%/70% customers prefer digital app/doc upload (Fannie Mae)
-BUT ALSO 65% prefer a human to explain everything (Fannie Mae)
-Buyers rely on online tools (79%) and agents (74%) to find homes (Zillow)
If technology doesn’t facilitate a seamless relationship between customer and all service providers—not just lender or realtor in isolation—it won’t meet customer expectations and today’s fractured process will remain.
CUSTOMER FUNNEL
-85% of sellers use an agent (Zillow)
Today listing agents have a lot of power in acquiring customers, but instant buyer model (iBuyer)—where a company like Opendoor just buys your home outright in a couple days instead of you listing it and taking months to sell—is changing this.
-51% of buyers found the home they bought on internet & 30% found via realtor (NAR)
-And this will grow 73% of renters use online resources to find a home (Zillow)
These stats are everything because they identify a trend that realtors aren’t the primary source of customer acquisition anymore. If all customers are starting online, it’s anyone’s game now in terms of getting to the customer first.
-Market is 75% purchase loans (MBA)
-15% of purchase loan apps close (The Basis Point poll)
-50-80% of pre-approvals close. Used to be 90% (The Basis Point poll)
-Buyers take 4.5 months to find a home (Zillow)
Because of customer’s online mindset, the concept of “acquisition” isn’t just getting them at top of funnel and you’re done. They drop out throughout the process, because they keep shopping for realtors and lenders during a very long and complicated process, so without personalized engagement methodology throughout the journey, this attrition will grow.