Research: Home Buyers, Sellers Influenced by Media
11th May 2008
MEDIA RELEASE - EMBARGOED UNTIL MIDNIGHT
New Research Shows Home Buyers & Sellers Greatly Influenced By Media Reports
Media stories on real estate trends and the affect they have on buyer and seller behaviour has been monitored for the first time and the results show the impact is immediate and significant.
“We all know buying a home is the most expensive purchase most of will ever make and one fraught with uncertainty and complexity. So it’s quite incredible decisions around it can be so dramatically influenced by media stories”, said the study’s author Alistair Helm, the CEO of www.realestate.co.nz
The Real Estate Industry turned over $34 billion in the past 12 months, transacted by over 16,000 agents. The NZ real estate asset base is valued at $420 billion*.
For the first time research shows that a series of negative headlines can send interest in property buying into a nose dive.
The study monitored 7 websites (the major portals and real estate company websites in NZ) over a two year period from January 2006 until the end of April 2008.
The most dramatic data showed the steep fall-off of traffic to these websites from the middle of February2008 - significantly off the seasonal trend (see graph).
This date in February correlates exactly with speculative media stories predicting 20%-30% correction in property prices around the release of the real estate industry’s January sales figures.
The website traffic clearly shows the market was spooked by headlines such as PROPERTY MARKET SET TO CRASH SAYS EXPERT and CONFIRM PROPERTY SLUMP BEDDED IN (13 February 2008), HOUSE SALE LOW IS SIGN THE TUMBLE HAS STARTED (14 February 2008), SHADES OF THE 80s IN HOUSING OBSESSION (16 February 2008).
Click to enlarge
Litmus Test: Now that the internet has taken over as the most valuable source of real estate information traffic to websites has become a new industry gauge of consumer behaviour.
The study also revealed a significant drop off in the number of new houses being listed for sale from early March.
The number of homes for sale being listed was close to 1,000 a week in January and February on www.realestate.co.nz but throughout March the total number of listings stayed static at around 109,000.
“The likely factor behind these figures is the combination of property being withdrawn from sale and owners reluctant to enter this very slow market”.
“Given the size of the industry and its importance to the NZ economy as well as each homeowner this study showing the extent of the media’s influence is quite a wake-up call”.
“Perhaps it’s time the industry began to provide its own media and look at directly connecting with customers by way of blog and email alerts and being more open with the major media by providing regular and expert insight into the state of the market”
For the whole story:
Click on UNCONDITIONAL (after 4pm) http://www.realestate.co.nz/blog/
www.realestate.co.nz is the official website of the real estate industry and the largest property website in NZ with 109,000 listings..