New home buyers start their research much earlier and take far longer to sign a contract than builders tend to think, according to new research.
In a study of buyer behavior that also could have strong implications for real estate brokers and mortgage lenders, the research found that on average, buyers of brand new homes take an average of nearly six months to ink a sales contract -- 84 days to do their research and then 80 more days to make up their minds.
When asked about the habits of their clients, however, the nearly 200 builders surveyed estimated that buyers did their homework over a far shorter 35-day period, and signed their names on the dotted line an average of 44 days later.
The fact the purchasers start the home buying process "much sooner than we think they do" means builders are "missing a big chance to get in their (customers') faces," said marketing specialist Dan Levitan of Ft. Lauderdale-based Levitan & Associates.
The study of some 1,000 buyers by Harris Interactive also found other areas of disconnect between them and their builders.
For example, while 52 percent use realty brokers, many builders still refuse to deal with real estate professionals or have no formal program for compensating them.
Also, whereas the two largest media buys on the part of builders are newspapers and "other" print publications – and 46 percent plan to boost their spending on print ads this year in the face of slower sales – web sites, signage and the Internet, in that order, were rated as a better source for finding out information by buyers.
Similarly, the Internet, radio and search engines all were rated by buyers as more useful than newspapers.
"The Internet does what we need to get in front of eyes for longer periods," commented Levitan, who presented the survey's findings at the National Association of Home Builders' annual convention in Orlando earlier this month. "It is more credible and valuable, and they say they would use it again."
But the research also confirmed similar findings of other studies that the Internet loses its luster if inquiries are not answered in a timely manner.
Nearly three out of four respondents said that the timeliness of a builder's response influenced their decision about from whom they bought a house, and 62 percent said they consider one day or less as an appropriate response time.