Consumer Sentiment Survey
Monday Jun 07th, 2021
CANADIAN REAL ESTATE INDUSTRY: CONSUMER SENTIMENT SURVEY
May 26th, 2021
CONSUMERS NEED MORE THAN BASIC HOUSING MARKET KNOWLEDGE FOR THEIR PROFESSIONAL REALTOR WHEN NAVIGATING CHALLENGING CANADIAN REAL ESTATE MARKET, NEW STUDY FINDS
New consumer survey by RE/MAX reveals that buying and selling in the Canadian housing market is not a simple “transaction,” but a complex negotiation:
- Almost half (41%) of Canadians claim they aren’t knowledgeable when it comes to buying or selling real estate.
- Ninety One per cent of Canadians say that when looking for a REALTOR® for outside support, the top must-haves are ethics in business, patience, active listening, and empathy.
- Eight in 10 Canadians (81%) say that they would be more likely to work with a REALTOR® if they had a certification in professionalism.
Toronto, ON and Kelowna, BC, May 26, 2021 – Homebuyers and sellers navigating the Canadian real estate market are in uncharted territory. Not only are they confronting another cycle of rising prices across the country, but historically low interest rates may test their long-term thresholds of affordability. As demand continues to far outstrip supply, none of this will be easily rectified in the short or mid-term.
Adding to these complexities is the unexpected rise of Canadians upending their urban lives in favour of new beginnings in suburban and rural settings, creating a dramatic shift in lifestyle expectations. As many as 35% of RE/MAX brokers across Canada recently indicated that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021.
Given these mounting challenges, it’s not entirely surprising that nearly half (41%) of Canadians claim to not be knowledgeable about the buying and selling process, according to a recent Leger survey commissioned by RE/MAX Canada. Yet, 50% still expressed interest in buying or selling a home using a DIY platform for its perceived efficiency, ease and convenience. But nothing about the current Canadian real estate market is easy, and with affordability issues coupled with the current health and safety measures, going it alone could have unintended consequences.
“The stakes have never been higher for buyers and sellers. It’s incumbent on the Canadian real estate industry to help consumers differentiate between full-time, regionally knowledgeable, professional realtors who genuinely have the required expertise to advise clients through these challenges, versus agents who treat their license as a means to ‘make a quick buck,’” says Christopher Alexander, Chief Strategy Officer and Executive Vice-President, RE/MAX of Ontario-Atlantic Canada. “Through this survey, we found that negative sentiments of the profession drastically decline once Canadians have been exposed to the professional realtor experience, as noted by the 86% of Canadians who are likely to use one in the future, after having used one previously. But like many advisory and professional services, some advance their interests before those of their clients. We must do a better job of helping Canadians find the best advisor for their needs.”
Alexander adds, “It’s about educating buyers and sellers on how to vet and source a REALTOR®. Agents with the right local knowledge to help them successfully find properties that are reasonably and transparently priced, and homes that will not leave them financially stretched when interest rates inevitably creep up.”
Of the 41% who aren’t knowledgeable when it comes to buying or selling real estate, nearly half (46%) are millennials, the largest cohort of buyers and sellers across the country. They are also the ones most likely to test alternatives to a REALTOR®-led transaction; as many as 57% state that they are more likely to buy or sell a home using real estate technology, given its increased availability.
“Like so many elements in the last year, the pandemic has shone a glaring light on the value and purpose of professional realtors with well-honed advisory-level skills that help clients through a maze of affordability, liveability and other key considerations,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “And given the critical importance of housing to the larger economy and us individually, it’s time the industry genuinely helped consumers learn to vet real estate agents who embody full-time professionalism.”
CANADIANS' THOUGHTS ON REALTORS®s
To date, most Canadians will choose to lean on a real estate professional to guide them through the buying and selling transaction as many as 77% claim to have previously used a REALTOR® to buy or sell a home. A streamlined process enabled by technology, knowledge of the market, support with legal paperwork, and access to listings are all notable reasons why consumers retain an agent, but technical acumen alone is not the marker of a REALTOR®.
According to the report, much of the satisfaction Canadians derive from the working relationship with a REALTOR® comes down to skills and qualities such as honesty/transparency (52%), trust (39%), and effective communicating (31%). Good business ethics, patience, active listening, and empathy were all tied for the top REALTOR® must-haves by Canadians (91%).
Yet, less flattering perceptions of the profession persist as a result of the industry not putting enough emphasis on the importance of using an agent who embodies the qualities of a professional realtor. As many as 51% of Canadians feel that REALTOR®’s commissions are their only priority, with a third (32%) believing that REALTOR®s do not accurately represent their experience or credentials, conflicting with the importance of honesty and trust.
Certain industry practices, such as blind bidding or under-market-listing, also add fuel to the fire, particularly for buyers. The lack of transparency around the transaction process has become a prominent point of conversation among industry professionals and consumers alike. The ongoing discussion of ethics as it relates to these practices presents an opportunity for those within real estate to realign on the best way to move forward for Canadian home buyers and sellers.
GUIDING CANADIANS TOWARD TRUE INDUSTRY PROFESSIONALS
The key to ensuring that Canadian home buyers and sellers are adequately supported through this challenging market, as well as breaking down any negative stigmas, starts by informing and educating Canadians on the attributes of a true professional realtor. With increasing technology providing more options for virtual, DIY listing and selling, it’s more important than ever that REALTOR®s promote and advocate the professionals who represent the vast majority of the industry.
“When 86% of consumers who have retained a REALTOR® in the past say that they’ll retain once again, it suggests that we’re doing a lot of things right. But given the tragic and disruptive effects that the last year of living in the pandemic has shown, we cannot take anything for granted and we must advocate for the interests of our clients by helping them source the best, most ethical, most proven REALTOR®s in their communities,” says Ash. “We can start by advocating for more transactional transparency, helping consumers know the questions to ask when vetting agents and assessing their quality of professionalism, and educate them on the credentials and referrals to expect from their REALTOR®.”
WHAT WILL DRIVE CANADIANS TO WORK WITH REALTOS®s?
In addition to the foundational legal licenses required of a REALTOR®, eight-in-ten Canadians (81%) say that they would be more likely to work with a REALTOR® if they had a certification of professionalism or a standard, they need to formally abide by to operate. Governing bodies such as the Canadian Real Estate Association have a professional code of conduct, known as CREA’s REALTOR® Code. Many provincial regulators have their own sets of regulations that also exist. Unfortunately, home buyers and sellers are often unaware that these standards are in place, not understanding the rules that govern industry practices, and may make assumptions that all REALTOR®s are free to professionally engage as they wish.
With nearly half of Canadians needing additional support and guidance when buying or selling real estate, certifying, and making Canadians more aware of the proven markers of professionalism must be encouraged. It can serve as an optimal way to support home buyers and sellers through one of the most complex real estate landscapes experienced, while simultaneously improving public sentiment of the profession.
ADDITIONAL SURVEY HIGHLIGHTS
Fifty-six per cent are confident in buying/selling residential real estate; 48% cent are not confident – and almost half (49%) of those who state they’re confident are millennial homebuyers.
Those who have worked with a REALTOR®, which accounts for 77% of Canadians, are satisfied were very satisfied with their experience (51%)
The factors conducive to real estate professionalism, as determined within the RE/MAX’s home buyer and seller survey include:
- Honest/transparent = 52%
- Trustworthy = 39%
- Effective communication skills = 31%
- Neighbourhood knowledge and expertise = 27%
- Effective negotiating skills = 24%
- Ethical = 24%
- Dedicated = 17%
- Personable = 11%
- Punctual = 9%
- Good use of technology and online tools = 9%
- Good email/phone etiquette = 8%
- Empathetic = 7%
- Poised/can maintain composure = 5%
ABOUT THE SURVEY
Leger is the largest Canadian-owned full-service market research firm. An online survey of 1,500 Canadians was completed between January 28 – February 2, 2021, using Leger’s online panel. Leger’s online panel has approximately 400,000 members nationally and has a retention rate of 90%. A probability sample of the same size would yield a margin of error of +/- 2.5%, 19 times out of 20.
PR & Content Manager