Leslie Appleton-Young, Chief Economist/California Association of Realtors presents his annual report to the California Desert Association of Realtors. The Palm Springs desert area (Coachella Valley) housing market is on the upswing once again.

1. Real Estate Market Update/
2012 FORECAST
California Desert AOR
January 26, 2012
Leslie Appleton-Young, Chief Economist

2. Overview
US and California Economies
California Housing Market
Regional & Local Markets
2011 Annual Market Survey
2012 Housing Market Forecast
CA Buyers & Sellers in Today’s Housing Market

3. U.S. Economic Outlook

4. Economy Slowly Gaining
Post-Stimulus Momentum
GDP 2010: 2.8% 2011:1.8% 2012: 2.6%
8%
7%
6%
ANNUAL QTRLY
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
2009 Largest Annual Drop since 1938 (-3.4%)
-4%
-5%
-6%
-7%
-8%
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
Q3-10
Q1-11
Q3-11

5. Performance Targets for National Economy
Current This Year -
Target Projected
Unemployment 6% 9.0%
US GDP 3% or higher 1.8%
Nonfarm Job 3%+ or
1.0%
Growth 400K+/mo
CPI 2.5% 3.2%
SOURCE: California Association of REALTORS®

6. Consumer Spending Rebounding
Holiday and Auto Sales
Consumer Spending 2011 Q3: 2.4%
8%
QUARTERLY PERCENT CHANGE
6%
4%
2%
0%
-2%
-4%
1Q-2000
1Q-2001
1Q-2002
1Q-2003
1Q-2004
1Q-2005
1Q-2006
1Q-2007
1Q-2008
1Q-2009
1Q-2010
1Q-2011
SOURCE: US Dept of Commerce, Bureau of Economic Analysis

7. 20
40
60
80
100
120
140
160
Jan-00
Jul-00
Jan-01
Jul-01
Jan-02
Jul-02
INDEX, 100=1985
Jan-03
Jul-03
Jan-04
Jul-04
Jan-05
Jul-05
Jan-06
Jul-06
Jan-07
Jul-07
Jan-08
December 2011: 64.5
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
Consumer Confidence: Nov/Dec Rebound
Holiday Shoppers & Improved Jobs Reports

8. CA Underwater Mortgages:
Reverse Wealth Effect
Negative Equity Share in CA Near Negative Equity Share in CA
40%
35%
30.2%
30%
25%
20%
15%
10%
4.6%
5%
0%
Q4‐2009
Q1‐2010
Q2‐2010
Q3‐2010
Q4‐2010
Q1‐2011
Q2‐2011
SOURCE: CoreLogic

9. Unemployment: Heading Lower
U.S. at 3 year low
December 2011
California (11.1%) vs. United States (8.5%)
14%
CA US
12%
10%
8%
6%
4%
2%
0%
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
SOURCE: CA Employment Development Division

10. U.S. Non-farm Job Growth: Gaining!
Month-to-Month Changes
Recession Job Losses: 8.8 million
Since Jan’10: +2.4 million
600,000
400,000
200,000
0
-200,000
-400,000
-600,000
-800,000
-1,000,000
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
Jul-09
Oct-09
Jan-10
Apr-10
Jul-10
Oct-10
Jan-11
Apr-11
Jul-11
Oct-11
SOURCE: US Dept of Labor, Bureau of Labor Statistics

11. California Non-farm Job Growth
Month-to-Month Changes
Recession Job Losses: 1.3 million
Since Jan’10: +282,000
100000
80000
60000
40000
20000
0
-20000
-40000
-60000
-80000
-100000
-120000
-140000
-160000
Nov-08
Nov-09
Nov-10
Nov-11
Jul-08
Sep-08
Jul-09
Sep-09
Jul-10
Sep-10
Jul-11
Sep-11
Jan-08
Jan-09
Jan-10
Jan-11
May-08
May-09
May-10
May-11
Mar-08
Mar-09
Mar-10
Mar-11
SOURCE: CA Employment Development Division

12. Where are California’s Jobs?
Employment Trends:
Construction & Financial Sectors Biggest Losers
Year to
Industry 2005 Jul-11
Date
Mining and Logging 23,600 27,600 4,000
Construction 905,300 567,300 -338,000
Manufacturing 1,502,600 1,257,600 -245,000
Trade, Transportation & Utilities 2,822,100 2,641,500 -180,600
Information 473,600 455,400 -18,200
Financial Activities 920,300 755,800 -164,500
Professional & Business Services 2,160,700 2,136,200 -24,500
Educational & Health Services 1,593,400 1,837,000 243,600
Leisure & Hospitality 1,475,200 1,531,600 56,400
Other Services 505,500 484,500 -21,000
Government 2,420,200 2,380,200 -40,000
TOTAL 14,802,500 14,074,700 -727,800
SOURCE: California Association of REALTORS®

13. CA New Housing Permits
2011: 47,015 units, Up 5.0% from 2010
300,000
Single Family Multi-Family
250,000
Household Growth: 220,000-250,000/yr
200,000
150,000
100,000
50,000
0
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
SOURCE: CBIA

14. Classic Liquidity Trap: Consumers Deleveraging
Low Rates and Tight Credit
Fed easing through 2012
10%
9%
8%
7%
6%
5%
4%
3%
2% FRM
ARM
1%
Federal Funds
0%
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
SOURCE: Federal Home Loan Mortgage Corporation

15. US Deficit Highest in Decades
2010: 11% of GDP (Revenues – Expenses)
4.0%
Deficit as a % of GDP
2.0%
0.0%
‐2.0%
‐4.0%
‐6.0%
‐8.0%
‐10.0%
‐12.0%
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
Source: US Treasury, BEA, compiled by C.A.R.
Note: Positive = Surplus

16. Federal Issues – Critical Concerns
for the REALTOR Party
Future of Fannie and Freddie? FHA?
Tax Reform on the horizon – Mortgage Interest
Deduction?
QRM (Qualified Residential Mortgage)
20% Down requirement -- Is the future of the
30 year mortgage in doubt?

17. U.S. Economic Outlook
2005 2006 2007 2008 2009 2010 2011f 2012f
•
US GDP 3.1% 2.7% 2.0% 0.0% -2.6% 2.9% 1.8% 2.6%
Nonfarm Job
1.7% 1.8% 1.1% -0.6% -4.4% -0.7% 1.0% 0.9%
Growth
Unemployment 5.1% 4.6% 4.6% 5.8% 9.3% 9.6% 9.0% 8.9%
CPI 3.4% 3.2% 2.8% 3.8% -0.4% 1.6% 3.2% 2.3%
Real Disposable
Income, % 1.3% 4.0% 2.2% 0.5% 0.9% 1.4% 1.7% 1.5%
Change
Forecast Date: January 2012
SOURCE: California Association of REALTORS®

18. California Economic Outlook
2005 2006 •
2007 2008 2009 2010 2011f 2012f
Nonfarm Job
1.8% 1.7% 0.8% -1.3% -6.0% -1.4% 1.5% 2.1%
Growth
Unemployment
5.4% 4.9% 5.4% 7.2% 11.4% 12.4% 12.0% 11.2%
Rate
Population
1.2% 1.1% 1.1% 1.2% 1.1% 0.9% 0.9% 0.9%
Growth
Real Disposable
Income, % 1.3% 3.4% 1.5% 0.1% -2.2% 1.6% 1.5% 2.0%
Change
Forecast Date: January 2012
SOURCE: California Association of REALTORS®

19. California Housing Market

20. Sales Hit Bottom 4 Years Ago
Median Price 2011 = 2002
UNITS/MEDIAN PRICE $
“Lost Decade”
Sales of Existing Detached Homes Median Price
700,000
-44%
600,000
500,000
-61% -25%
400,000
300,000
200,000
100,000
0
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
SOURCE: California Association of REALTORS®

21. Sales of Existing Detached Homes and Pacific West Consumer Confidence
• California, December 2011 Sales: 520,940 Units, Up 1.1% YTD, Up 0.1% YTY
UNITS Sales Consumer Confidence INDEX
700,000 160
600,000 140
120
500,000
100
400,000
80
300,000
60
200,000
40
100,000 20
0 0
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
SOURCE: California Association of REALTORS®; The Conference Board
*Sales are seasonally adjusted and annualized

22. Mortgage Loan Applications for Purchase
January 20, 2012: 184.8
600
INDEX, 100 = 03/16/90
500
400
300
200
100
0
Jan-90
Jan-91
Jan-92
Jan-93
Jan-94
Jan-95
Jan-96
Jan-97
Jan-98
Jan-99
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
Jan-12
Source: Mortgage Bankers Association

23. Mortgage Applications – Total Purchase Loans
(Weekly % Chg.)
60%
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
Aug-11
Nov-11
Apr-11
Sep-11
Oct-11
Jan-11
Dec-11
Jan-12
Feb-11
Jun-11
Jul-11
May-11
Mar-11
Source: Mortgage Bankers Association

24. Median Price of Existing Detached Homes
California, December 2011: $285,920, Down 6.2% YTY
$700,000 P: May-07
$594,530
$600,000
$500,000 T: Feb-09
$245,230
$400,000 -59% from
peak
$300,000
$200,000
$100,000
$0
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
SOURCE: California Association of REALTORS®

25. Trough vs. Current Price – December 2011
Southern California
Trough Trough Dec-11 % Chg From
Region
Month Price Median Trough
San Bernardino County May-09 $120,410 $128,450 6.7%
Ventura Couty Feb-09 $359,630 $391,060 8.7%
Orange County Jan-09 $442,170 $484,630 9.6%
San Diego County Mar-09 $326,830 $359,930 10.1%
Palm Springs/Lower Desert Apr-09 $150,140 $165,960 10.5%
Inland Empire Apr-09 $150,860 $172,430 14.3%
CALIFORNIA Feb-09 $245,230 $285,920 16.6%
Southern California Apr-09 $246,063 $286,950 16.6%
Los Angeles Metro Apr-09 $227,370 $265,830 16.9%
Riverside County Apr-09 $171,480 $203,650 18.8%
Los Angeles County May-09 $248,850 $306,950 23.3%
SOURCE: California Association of REALTORS®

26. 0
2
4
6
8
10
12
14
16
18
20
MONTHS
Jan-88
Jan-89
Jan-90
Jan-91
Jan-92
Jan-93
Jan-94
Jan-95
Jan-96
Jan-97
Jan-98
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
Jan-99
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Unsold Inventory Index
Jan-06
Jan-07
Jan-08
Jan-09
California, December 2011: 4.2 Months
Jan-10
Jan-11

27. Tight Supply of Inventory for REO Sales
2011
Unsold
Inventory Index 8.9
(Months)
9
6.7
8
7
6
5
2.7
4
3
2
1
0
Equity Sales REO Sales Short Sales
SOURCE: California Association of REALTORS®

28. Higher Price = Higher Inventory
Unsold Inventory Index
(Months of Supply)
Price Range (Thousand) Dec-10 Nov-11 Dec-11
$1,000K+ 8.2 9.6 8.3
$750-1000K 5.7 7.0 5.9
$500-750K 4.7 6.0 4.5
$300-500K 4.9 5.3 4.4
$0-300K 4.9 4.7 3.9
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®

29. California’s Million-Dollar Home Sales
Year
1988 2,718
1989 4,271
1990 3,773
1991 3,362
1992 2,890
1993 2,298
1994 2,522
1995 2,017
1996 2,651
1997 3,762
1998 5,366
1999 8,906
2000 13,101
2001 10,658
2002 15,703
2003 20,595
2004 36,990
2005 54,773
2006 50,010
2007 42,506
2008 24,436
2009 18,621
2010 22529
0
10000
20000
30000
40000
50000
60000
Number of Homes
Source: DataQuick Information Systems

30. Market Breakdown:
Equity v. Distressed
Sales

31. Share of Distressed Sales to Total Sales
Dec‐11
REOs, 24.6%
Equity Sales, Short Sales,
52.7% 22.2%
Other Distressed
Sales (Not
Specified), 0.5%
SOURCE: California Association of REALTORS®

32. Share of Equity Sales
Increased Throughout 2011
Equity Sales Short Sale Bank Owned
60%
50%
40%
30%
20%
10%
0%
Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11
SOURCE: ForeclosureRadar.com

33. Distressed Sales: Southern California
(Percent of Total Sales) Dec-11
100%
80%
63% 67%
60% 49%
42%
40%
28%
20%
0%
Los Angeles
Orange
Riverside
SOURCE: California Association of REALTORS® San
Bernardino San Diego

34. REO & Short Sales: Southern California
(Percent of Total Sales)
100% Dec 2011
80% Short Sales
REO Sales
60%
19%
31%
40% 27%
26%
20%
21% 47%
31% 10%
15%
0%
18%
Los Angeles
Orange
Riverside
San
SOURCE: California Association of REALTORS®
Bernardino San Diego

36. Mortgage Foreclosure & Delinquency Rates
California: Q3-2011
Delinquency Rate Foreclosure Rate
12%
10%
7.6%
8% Delinquencies: Long Run Average: 4.4%
6%
4% 3.6%
Foreclosure Rate: Long Run Average: 1.2%
2%
0%
Q1/74
Q2/75
Q3/76
Q4/77
Q1/79
Q2/80
Q3/81
Q4/82
Q1/84
Q2/85
Q3/86
Q4/87
Q1/89
Q2/90
Q3/91
Q4/92
Q1/94
Q2/95
Q3/96
Q4/97
Q1/99
Q2/00
Q3/01
Q4/02
Q1/04
Q2/05
Q3/06
Q4/07
Q1/09
Q2/10
Q3/11
SOURCE: Mortgage Bankers Association

37. California Foreclosure Outcomes, Dec. 2011
REO: -16.4% YTD • 3rd Party: +5.0% YTD • Cancel: -13.1% YTD
REOs Sold to 3rd Party Cancellations
6 Month Average:
30,000
REO: 8,950
25,000
3rd Party: 3,353
Cancelled: 13,243
20,000
15,000
10,000
5,000
0
Jul-07
Jul-08
Jul-09
Jul-10
Jul-11
Jan-07
Apr-07
Oct-07
Jan-08
Apr-08
Oct-08
Jan-09
Apr-09
Oct-09
Jan-10
Apr-10
Oct-10
Jan-11
Apr-11
Oct-11
SOURCE: ForeclosureRadar.com

38. California Foreclosure Inventories, Dec. 2011
Preforeclosure: -19.7% YTD • Schedule for Sale: -21.7% YTD •
Bank Owned: 0.6% YTD
Preforeclosure Scheduled for Sale Bank Owned
6 Month Average:
200,000 Preforeclosure: 109,200
Schedule for Sale: 89,029
Bank Owned: 100,887
150,000
100,000
50,000
0
Jan-07
Apr-07
Jul-07
Jul-08
Jul-09
Oct-07
Jan-08
Apr-08
Oct-08
Jan-09
Apr-09
Oct-09
Jan-10
Apr-10
Jul-10
Oct-10
Jan-11
Apr-11
Jul-11
Oct-11
SOURCE: ForeclosureRadar.com

39. 0
10
20
30
40
50
60
Q1/84
Q1/85 THOUSANDS
Q1/86
Q1/87
Q1/88
Q1/89
Q1/90
SOURCE: Real Estate Research Council
Q1/91
Q1/92
Q1/93
Q1/94
Q1/95
Q1/96
Q1/97
Q1/98
Q1/99
Q1/00
Q1/01
Foreclosures
Q1/02
Southern California
Q1/03
Q1/04
Q1/05
Q1/06
Q1/07
Q1/08
Q1/09
Q1/10
Q1/11

40. Palm Desert
Preforeclosure: 199 • Auction: 123 • Bank Owned: 88
Source: ForeclosureRadar.com as of 01/19/2012.

41. La Quinta
Preforeclosure: 159 • Auction: 138 • Bank Owned: 100
Source: ForeclosureRadar.com as of 01/19/2012.

42. Indio
Preforeclosure: 315 • Auction: 205 • Bank Owned: 157
Source: ForeclosureRadar.com as of 01/19/2012.

43. Sacramento
Preforeclosure: 2,216 • Auction: 1,905 • Bank Owned: 1,560
Source: ForeclosureRadar.com as of 08/19/11

44. Sacramento
Preforeclosure: 2,216 • Auction: 1,905 • Bank Owned: 1,560
Source: ForeclosureRadar.com as of 08/19/11

45. Sacramento
Preforeclosure: 2,216 • Auction: 1,905 • Bank Owned: 1,560
Source: ForeclosureRadar.com as of 08/19/11

46. Sacramento
Preforeclosure: 2,216 • Auction: 1,905 • Bank Owned: 1,560
Source: ForeclosureRadar.com as of 08/19/11

47. Local Market
Conditions

48. Sales of Residential Properties
Palm Desert, 2011: 1,514 Units, Up 7.4% YTY
180
160
140
120
100
80
60 2010
40
2011
20
0
O ct
Apr
S ep t
Ju l
Nov
D ec
M ar
F eb
Ju n
Aug
Jan
M ay
SOURCE: Clarus Market Metrics

49. Sales of Residential Homes
Palm Desert, December 2011: 121 Unit
, Up 17.5% MTM, Down 2.4% YTY
SOURCE: Clarus Market Metrics

50. Median Price of Residential Homes
Palm Desert, December 2011: $265,000
Up 6.0% MTM, Down 8.5% YTY
SOURCE: Clarus Market Metrics

51. Sales of Residential Properties
La Quinta, 2011: 1,353 Units, Up 5.5% YTY
160
140
120
100
80
60
2010
40
20 2011
0
Oct
Nov
Dec
Apr
Sept
Jul
Jan
Feb
Jun
Aug
May
Mar
SOURCE: Clarus Market Metrics

52. Sales of Residential Homes
La Quinta, December 2011: 129 Units
Up 51.8% MTM, Up 18.3% YTY
SOURCE: Clarus Market Metrics

53. Median Price of Residential Homes
La Quinta, December 2011: $285,000
Down 9.8% MTM, Up 0.4% YTY
SOURCE: Clarus Market Metrics

54. Sales of Residential Properties
Indio, 2011: 1,461 Units, Down 2.1% YTY
200
180
160
140
120
100
80
60 2010
40
2011
20
0
O ct
Apr
S ep t
Ju l
Nov
D ec
M ar
F eb
Ju n
Aug
Jan
M ay
SOURCE: Clarus Market Metrics

55. Sales of Residential Homes
Indio, December 2011: 125 Units
Up 26.3% MTM, Down 4.6% YTY
SOURCE: Clarus Market Metrics

56. Median Price of Residential Homes
Indio, December 2011: $159,900
Up 6.6% MTM, Down 8.6% YTY
SOURCE: Clarus Market Metrics

57. 2011 Annual Housing
Market Survey

58. Equity vs. REO vs. Short Sales
Equity Sales REO Sales Short Sales
Share of Total Sales 58.7% 19.7% 20.2%
Median Home Price $431,000 $240,000 $287,000
Square Footage 1,783 1,500 1,600
Price / SF $250 $112 $175
Sales‐to‐List Price Ratio 95.9% 98.0% 95.9%
% of Sales With Multiple Offers 35.2% 58.3% 57.5%
Avg. Number of Offers 3.0 3.0 3.6
% of All Cash Sales 25.5% 34.0% 23.3%
Days on MLS 67 50 141
Days in Escrow 35 35 45

59. Proportion of Sellers Planning to
Repurchase
80%
70%
60%
50%
40%
30%
20%
10%
0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Q. Is the seller planning on purchasing another home?

60. Reasons Sellers Not Planning to
Buy Another Home
Seller is a lender/bank 19.8%
Seller prefers to have less financial obligation 11.4%
Poor credit background 10.9%
Lack of cash for down payment 5.7%
Out of work/unemployment 4.9%
Decide to live with family/friends 4.7%
Waiting for market to bottom 2.7%
0% 10% 20% 30% 40% 50%
Q. Why is the seller not planning to purchase another home?

61. Reasons For Selling
All Home Sellers
Foreclosure/Short
Sale/Default
Change in Family Status
Retirement/Move to
Retirement Community
Investment/ Tax
Consderations
Desired Better Location
Desired Smaller Home
Changed Jobs
Desired Larger Home
Other
0% 5% 10% 15% 20% 25% 30% 35%
Q. What was the single most important reason for selling/buying the property?

62. Investments & Second/
Vacation Homes
Investment/Rental Property Vacation/Second Home
25%
20% 7%
15%
10%
17%
5%
0%

63. Foreign Buyers
10%
% of Foreign Buyers
8%
8%
6% 6%
6% 5%
4%
2%
0%
2008 2009 2010 2011
Q. Was the buyer a foreign buyer?

64. California Housing
Market Forecast

65. Forecast Progress Report
2010 2011
Projected Forecast 2011
2010 Actual
October October Projected
2010 2010
SFH Resales
492.0 491.5 502.0 491.1
(000s)
% Change ‐10.0% ‐10.1% 2.0% ‐0.1%
Median Price
$306.5 $303.1 $312.5 $291.0
($000s)
% Change 11.5% 10.2% 2.0% ‐4.0%
Forecast Date: September 2011 vs October 2010
Source: CALIFORNIA ASSOCIATION OF REALTORS®

66. California Housing Market Outlook
2005 2006 2007 2008 2009 2010 2011f 2012f
SFH Resales
625.0 477.5 346.9 441.8 546.9 491.5 491.1 496.2
(000s)
% Change 0.03% -23.6% -27.3% 27.3% 23.8% -10.1% -0.1% 1.0%
Median
Price $522.7 $556.4 $560.3 $348.5 $275.0 $303.1 $291.0 $296.0
($000s)
% Change 16.0% 6.5% 0.7% -37.8% -21.1% 10.2% -4.0% 1.7%
30-Yr FRM 5.9% 6.4% 6.3% 6.0% 5.1% 4.7% 4.5% 4.7%
1-Yr ARM 4.5% 5.5% 5.6% 5.2% 4.7% 3.5% 3.0% 3.1%
Forecast Date: September 2011
Source: CALIFORNIA ASSOCIATION OF REALTORS®

67. Real Estate Buyers &
Sellers in Today’s
Market

68. How Buyers Found Home
- 2011 -
Q. How did you find the home your purcahsed?

69. The Buying Experience
Considered buying for over 4 months
Shopped 2.5 months before contacting agent
Viewed 12 homes in 8 weeks with agent
76% of buyers didn’t close escrow on time
49% owned previous home
Motivated by price decreases, low mortgage
rates and tax deductions
80% found home through agent

70. The Selling Experience
Home was listed more than 2 months
before opening escrow
Median escrow length was 1.5 months
Only 40% of sellers said their escrow
closed on time
20% of sellers used electronic signature

71. Why Buyers Chose their Agent
1. Most responsive (28%)
2. Worked with agent before (18%)
3. First to respond (17%)
4. Most aggressive (16%)
5. Most knowledgeable (6%)
Q. What was the single most important reason for selecting the agent that you
used in your recent home purchase?

72. Why Sellers Chose their Agent
1. First to Respond (21%)
2. Seemed most responsive (21%)
3. Seemed most aggressive (19%)
4. Worked with agent before (16%)
5. Understanding of distressed properties (6%)
Q. What was the single most important reason for selecting the agent that you
used in your recent home purchase?

73. Buyer Method of Communicating With Agent
Preferred Actual
E-mail 73% 70%
Telephone 37% 50%
Text message 32% 1%
Twitter 21% 0%
Facebook 14% 0%
In-person 6% 3%
Q. What was your preferred method of communicating with your agent? How did
your agent actually communicate with you?

74. Preferred Actual
73%
69%
64%
47%
26%
18%
3% 5% 6%
1%
Q: What was your preferred method of communication with your agent?
Q: What was the actual method of communication used most frequently with your agent?
Agent / Seller Communication Gap

75. Buyer Expected vs Actual Agent Response Time
Expected Actual
100%
90%
80%
70%
60%
50%
37% 37%
40%
28%
30%
18% 16%
20% 15% 13%
7% 11% 8%
6%
10% 2% 4%
0%
0%
Instantly Within Within 1 Within 2 Within 4 Same day 1
30mins. hr. hrs. hrs. business
Q. What was the typical response time you expected from day
your agent to return any form of communication to you?
Q. On average, what was the actual response time of your
agent to return any form of communication to you?

76. Actual Expected
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Instantly Within 30 Within 1 Within 2 Within 4 Same day 1
Minutes Hour Hours Hours business
day
Q: What was the typical response time you EXPECTED from your agent to return any form of communication with you?
Q: On average, what was the ACTUAL time of your agent to return any form of communication to you?
Seller Response Time is of the Essence

77. Buyer Reasons for Satisfaction With Agent
1. Worked hard on my behalf (55%)
2. Helped find the best home for me (55%)
3. Always quick to respond (31%)
4. Negotiated good deal on my behalf (29%)
5. Listened to what we needed (20%)
Q. Why do you have that level of satisfaction with your agent?

78. Buyer Reasons for Dissatisfaction With Agent
1. Slow to respond (51%)
2. Communication problems (19%)
3. Didn’t communicate effectively during
transaction (14%)
4. Didn’t negotiate aggressively on my behalf
(12%)
5. Wasted time with homes I’m not likely to buy
(3%)
Q. Why do you have that level of satisfaction with your agent?

79. What Buyers Would Like to Change About their
Home Buying Experience
1. Faster response from agent (30%)
2. Better agent negotiation (27%)
3. Better agent communication (25%)
4. Better market direction understanding (19%)
5. Escrow close on time (9%)
Q. If there is one thing you would like to change about your home buying
experience, what would that be?

80. Quick Facts About Buyers
• 59% found their agent online
• 51% Googled their agent
• 52% used social media in the buying process
• 93% are receptive to receiving information via
social media

81. How Internet Was Used
Activity Percentage of Buyers
Preview homes to narrow search 75%
Find an agent 68%
Identify homes for agent to show 47%
Find a real estate firm 40%
Learn about neighborhoods 33%
Get information about financing & downpayments 33%
Q. For which of the following did you use the internet as a part of your home
buying process?

82. Buyer Importance of Online
Features in Home Viewing
Q. Please rate the following online features by the level of importance in your home viewing
on a scale of one to five, with five being extremely important and one being not at all
important.

83. Top 10 Websites Used
Real estate agent website
Q. Which websites did you use as part of your home buying process?

84. 52% of Buyers Used Social Media
Activity Percent of Buyers Who Engaged in Activity
Agent referrals 33%
Video home tours 26%
Agent Facebook page 24%
Home buying tips 23%
Comments on neighborhoods 21%
Neighborhood lifestyle 20%
Q. How did you use social media (such as Facebook, Twitter, LinkedIn, etc.) in
your home buying process?

85. 77% of Sellers Used Social Media
Q: Which social media websites did you use to learn more about and communicate with
real estate agents and companies?

86. Closing Thoughts

87. Direction of Home Prices: Sellers
Skeptical; Buyers Hopeful
Down Flat Unsure Up
100%
80%
60%
40%
20%
0%
Sellers Buyers
Q: Do you think home prices in your neighborhood will go up, down or stay flat in one year, five years and 10 years?

88. Real Estate: It’s Time To Buy Again
“Forget stocks. Don't bet on gold.
After four years of plunging home
prices, the most attractive asset
class in America is housing.”
SOURCE: “Real estate: It’s time to buy again” Fortune Magazine’s 3/28/11 article written by Shawn Tully

89. 8 in 10 Americans Agree Buying a Home is
the Best Investment One Can Make
SOURCE: Pew Research Center’s “Home Sweet Home. Still. Five Years After the Bubble Burst”

90. 8 in 10 Renters Would Like to
Buy in the Future
“…renters are hardly
immune to the allure of
homeownership, even in
the face of the five-year
decline in prices. Asked if
they rent out of choice or
because they cannot
afford to buy a home, just
24% say they
rent out of
choice.”
SOURCE: Pew Research Center’s “Home Sweet Home. Still. Five Years After the Bubble Burst”

91. C.A.R. Strategic Planning Books

93. Thank You
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