A first-of-its-kind ranking of customer satisfaction with national real estate brokerages not only gives Keller Williams and Prudential something to crow about, but creates industry benchmarks local brokers can use to distinguish themselves from the competition.
The J.D. Power and Associates 2008 Home Buyer/Seller Study surveyed more than 3,200 people who bought or sold a home between April 2007 and June 2008. Buyers gave Keller Williams the highest overall satisfaction ratings, while Prudential was ranked highest by those who sold a home.
Although the California-based marketing research firm has conducted similar proprietary surveys for brokerages’ internal use, this is the firm’s first "syndicated" study of customer satisfaction in the real estate industry. J.D. Power funds syndicated studies itself, releasing the results publicly and awarding trophies to top-scoring firms.
The highest-ranked company in each category can enter into a licensing agreement and advertise that fact, said Jim Howland, senior director of J.D. Power’s real estate and construction practice. At the local level, brokerages can hire J.D. Power to conduct customer satisfaction research with their clients. If they deliver a high level of satisfaction compared to the benchmarks established in the study, they can earn recognition through J.D. Power’s "Agency of Excellence" program, Howland said.
"Because the scores are so close together, I’d say there’s a lot of opportunity for companies to differentiate themselves" based on the level of service they provide, Howland said. "If you can provide a quality experience, you have a chance to set yourself apart from the competition."
The national study was confined to large brokerages, because a minimum of 100 consumer evaluations was required to do the statistical regressions analyzing the factors driving customer satisfaction, Howland said. The study included 3,670 evaluations from 3,205 respondents, with some who both bought and sold a home during the study period rating both transactions.
The inaugural study found that it took sellers an average of six months to close a deal, and that 23 percent of sellers had listed their home with another agent before having success with the broker evaluated, Howland said.
On a 1,000-point scale, satisfaction averaged 794 when customers sold their homes in five months or less, but declined to an average of 730 when the process took seven months or longer.
Four factors were considered in overall satisfaction of those selling a home — agent (43 percent); marketing (38 percent); office (12 percent); and services (7 percent).
Prudential ranked highest among sellers, with a score of 793, performing particularly well in the marketing and office factors, J.D. Power said. Coldwell Banker and RE/MAX followed Prudential in seller rankings, in a tie. GMAC, Century 21, Keller Williams and ERA received lower satisfaction ratings from sellers.
Home buyer satisfaction was determined by three factors: agent (65 percent); office (21 percent); and services (13 percent). Keller Williams had the highest scores among buyers in all three areas, and the top overall satisfaction score (831), followed by Prudential (820) and Coldwell Banker (816). RE/MAX, Century 21, ERA and GMAC finished lower in buyer rankings.
The study also found:
- Some 46 percent of those surveyed said they relied on recommendations from family or friends to find their real estate agent. Approximately 28 percent used the Internet; 23 percent went to an agent they had used previously; and 11 percent used a printed real estate guide.
- On average, home buyers were shown approximately 13 homes before making a purchase.
- Home sellers said their home was shown approximately 11 times, and approximately five open houses were conducted before the sale occurred.
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