Before & After

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Buyers rate builders' before sale support and after sale service, and the results suggest improvement is possible.

August 01, 2000

In an economy as robust as this one has been for the last decade it’s easy to believe new home buyers will always beat a path to any product built. Fundamentally, that is true. But what data from Professional Builder’s 2000 consumer survey shows is what won’t - can’t - stay the same in the builder/buyer relationship in the new millennium:

  • the way buyers gather information about their new home purchase;

  • the factors influencing buyer choices today, and

  • the quality and service expectation customers have for a new home and for its builder.

    Before getting into the data, it’s important to review a few specifics on this year’s survey. The research was conducted through National Family Opinion. The nine-page questionnaire was mailed to 1200 households, and 997 of them were returned, for an 83.1% response rate.

    Of those responding, 64% had purchased a newly constructed home in the past year and 36% planned to buy a new home within a year. Among the first group, 29.6% were first-time home buyers and the remaining 70.4% had owned a home before, though their most recent purchase was a newly built home.

    Information Gathering


    Consumers have more access to more information about new homes and new home builders than ever before, and they’re using it. For the first time in PB’s consumer survey history, we measured the effect of the Internet on the new home buying process. While only one in 10 consumers found their new home via the Web, 44.3% reported going to the Internet at least once a week to research their housing options. Slightly less than a quarter of new home buyers surveyed never visited the Internet.

    Internet Information Buyers Want
    Of those new home buyres that used the Internet to research their housing choices, consumers said this is the information they needed but couldn''''t find on the websites they visited.
    Missing Info
    Percent

  • Floor plans for all locations/pictures

  • 18.6

  • Pricing/pricing other than base

  • 16.8

  • Neighborhood Details (school districts, crime statistics)

  • 15.3

  • Available lots

  • 10.2

  • True to life floor, carpet, wall samples and colors

  • 6.8

    The most trafficked websites by consumers - as well as those rated most useful - were those that offered house plans. A close second and third in the usefulness rating were websites that included photographs of the homes and complete pricing information. In general, the largest segment of new home buyers, 36%, rated builder websites as influential in helping them decide which communities and models to go out and visit in person.

    In addition, new home buyers are also using the Internet to research the products that might go into their new homes. Slightly more than half of all new home buyers used websites to collect product information. The respondents’ top five most trafficked product websites in descending order are appliances, plumbing fixtures and faucets, windows, floors and floor coverings and lighting.

    Buying Influences



    After Sales Warranty Service Requests by Product Category
    Product
    Percent

    Windows
    19.9

    Doors
    18.0

    Appliances
    21.1

    Roofing
    13.5

    Siding
    10.7

    Heating
    17.5

    Air Conditioning
    19.9

    Other
    27.6

    None
    29.8

    While consumers regularly turn to the Internet as a research aid in the new home buying process, the Web isn’t influencing model foot traffic yet, according to survey respondents. The average new home buyer visited 9.1 model homes before making a purchasing decision, and considered 3.3 different builders.

    In this most recent edition of the consumer survey, we again asked buyers to define the most important reasons for selecting their newly constructed home.

    Among the 20-plus possibilities, the top 10 for non-first time buyers were:

      1. Floor plan/layout of the interior...........80.1%

      2. Good design of the home...................72.9%

      3. Size (number of rooms)...................... 70.9%

      4. Style and appearance........................65.2%

      5. Quality home......................................63.4%

      6. Price/affordability...............................55.8%

      7. Number of bathrooms.........................49.4%

      8. Size of yard/lot...................................47.0%

      9. Good Investment...............................43.3%

      10. More modern amenities/features.....40.0%

    Among first-time home buyers, the same top 10 list is as follows:

      1&2. Floor plan/layout of the interior and Price/ affordability...........70.4%

      3. Size (number of rooms)...............................................................62.9%

      4. Style and appearance................................................................58.6%

      5. Good design of the home...........................................................57.0%

      6. Quality home..............................................................................52.2%

      7. Good Investment.......................................................................50.0%

      8. Number of bathrooms................................................................47.3%

      9. Mortgage interest rates..............................................................45.2%

      10. Size of yard/lot........................................................................37.1%

    Important to both buying groups was the opportunity to customize their new home. Roughly 60% of those surveyed had input into the brand selections of various products and features in their new home. Nine out of 10 reported they were able to substitute their preferred brand instead of using the builder’s standard brand. However, 68.1% of new home buyers said the builder offered these alternative brands as options and upgrades.

    Quality Expectations



    Builder Selection
    On a scale of one to five, new home buyers rated the importance of the following factors in their decision to select a builder.
     
    First-time Buyers


    Non First-time Buyers

    Floor Plans
    4.13


    4.12

    Reputation
    3.89


    4.09

    Word of Mouth
    3.61


    3.64

    Number of Homes Built
    3.51


    3.61

    Length of Time in Business
    3.50


    3.57

    Some of the most enlightening data gleaned from new home buyers is in the area of the construction process from contract signing, through construction communication, to closing and warranty service. For example:

  • At the time the contract was signed, 45.9% of buyers did not receive a closing date from the builder. Of the 54.1% that did, 65.6% were able to close on time, and 34.4% did not. "Other" was the reason cited most for not closing on time and the specific problems run the gamut from construction-related problems to missing doors and the wrong countertops. In second place at 36.5% were incomplete inspections. A close third at 34.1%, was "promised items not completed to my satisfaction."

  • Among those surveyed, the net number of days after the agreed upon closing date for actual move in was 63.

  • In every instance, the majority of new home buyers were able to meet with the builder during construction. Before construction, 61.8% met with the builder to review the process, 56.6% walked the home before drywall was installed and 78.7% did the same a few days before closing.

  • At final walk-through, 52.7% of buyers reported that cosmetic corrections were needed in their home; at closing 44.2% said the same. Only 31.8% and 33% of buyers reported that everything was completed at final walk-through and at closing, respectively. In addition to cosmetic corrections, home buyers cited several other reasons for callbacks. In ranked order those callbacks were for the following: cracks in drywall, cabinet doors that do not close correctly, countertop scratches, improperly sealed windows and doors, unpainted walls and glitches with heating and cooling systems.

  • Better than three out of four consumers said they had to call the builder back for repairs after moving into their home. On average, it took builders 2.3 days to return the customer’s call and 21.2 days from the date the call was returned for the requested repairs to be completed.

  • Overall customer satisfaction among buyers of newly constructed homes, however, was generally very high. More than 80% were at a minimum "satisfied" with their new home. More than a third were "extremely satisfied."

    On the business-building side of satisfied customers - the likelihood the homeowner would refer other buyers to the builder - the news was equally positive. Almost 40% of the survey respondents agreed with the statement that they were "very likely" to refer the builder to other buyers. Another 41% of buyers agreed, responding that they would be "somewhat likely" and "likely" to refer.

    Going one step further, the survey asked a question that gauged the importance of those referrals. When new home buyers registered the relative importance of a builder’s reputation in selecting who would build their new home, 96% said it was "very" to "somewhat" important.

    Average Number of Builders Considered
    Percentage-wise, new home buyers rated the importance of the following factors in their decision to select a builder.
     
    First-time Buyers


    Non First-time Buyers

    One or Two
    50.9


    46.9

    Three or Four
    32.25


    35.4

    Five to Seven
    13.5


    9.6

    Eight to Ten
    2.3


    4.9

    More than Ten
    1.2


    3.1

    When it comes right down to it, buyers today have a wealth of information at their fingertips and they know exactly what they want in a new home. And for the most par - at least right now - they have the money to pay for it. But that, as we all know, will not always be the case.

    These consumer preferences indicate a trend toward increased expectations from buyers - in features, in information availability, in quality, in satisfaction. And those expectations will go even higher when and if the economic climate retreats for awhile.

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