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SAN FRANCISCO, Calif. -- September 9, 2021 -- Qualia, the leading digital real estate closing platform, today announced the release of its Homebuyer Sentiment Index, which shined a light on the risks consumers may be taking when they act too quickly without understanding the home purchase process or transaction costs involved. The survey, conducted by an independent third-party research firm, Savanta Research, polled more than 1,000 consumers and found that only one in five homebuyers said they understood all of the documents they signed at closing. Meanwhile, homebuyers are acting quickly in a competitive market with nearly a quarter of homebuyers purchasing their home sight unseen.
"This survey emphasizes the need for increased education and transparency during the home buying and selling process," says Nate Baker, CEO of Qualia. "Our core belief is that technology that powers the transaction is the key to providing that assurance. It can simplify a very complex process to allow real estate professionals to focus on client education and a seamless home buying experience."
Insights from the survey revealed:
Low interest rates and limited housing inventory sparked a competitive housing market. The survey highlighted how far buyers were willing to go to get the house of their dreams. Nearly a third (30%) of buyers paid more than anticipated for their home, and of those who paid more than anticipated, 32% paid $50,000 or more over the asking price. Buyers are also making what they may believe to be calculated concessions, with some removing inspections from the contract (19%) or purchasing the home without seeing it in person (23%).
The survey indicates that recent homebuyers found the real estate closing process to be the most stressful and complicated part of the real estate transaction itself. In fact, when Qualia explored the consumer sentiments around the entire homebuying journey, the only thing more stressful or complicated than the closing was the move-in process.
Future homebuyers are also apprehensive about real estate closings. One in four future homebuyers reported that they do not understand the closing process. Qualia's survey illuminates the value of combining knowledgeable local agents to guide homebuyers through the process with technology that automates real-time transaction updates and offers consumers instant access to information.
Despite the requirement of closing disclosures (CDs) to inform homebuyers of their transaction costs, consumers still lack an overall awareness of the costs associated with buying a home. In fact, 44% of recent homebuyers were surprised by higher-than-anticipated transaction costs. Qualia's survey also found that consumers desire multiple touchpoints to receive information prior to closing. More than half (55%) of future homebuyers would like to receive information face-to-face about the closing process prior to the closing date and nearly half would like to receive information over a secure mobile app or web-based portal (44%). The survey data demonstrates the importance of empowering and educating consumers on whatever channel they choose to engage.
Personal finance struggles and student debt have created roadblocks for Millennials to become first-time homebuyers, but they are not throwing in the towel on homeownership. According to the study, 72% of Millennials that are in the market to purchase a home are currently saving more than $500 a month to do so.
The percentage of homebuyers seeking more space increased more than 10 percentage points within the past year since Qualia's November 2020 survey. According to the study, the most popular reason for buying a new home was the need for more space (36%) (vs 23% in November 2020). Needing less space was the top driver for only 5% of recent homebuyers. With work from home increasingly becoming a more widely accepted work environment, is this a signal that any downsizing trends may not pick back up as offices reopen?
Qualia commissioned Savanta Research to conduct a quantitative online research study during July 1-July 9, 2021 among a general consumer pool in the US who recently bought a home or are planning to in the coming 12 months. 1,024 respondents participated in the study. The margin of error is 3.1% at a 95% confidence level.
Qualia is the category-creating digital closing platform used by over half a million real estate professionals. Qualia's cloud-based closing rooms provide the complete infrastructure to streamline the home closing experience for real estate businesses and their clients. The company offers a suite of products that brings together homebuyers and sellers, lenders, title & escrow agents, and real estate agents onto one secure, remote platform. Since launching in 2015, the company has been named an ALTA Elite Provider, CB Insights Fintech 250, grown to over 500 employees, and has been recognized by Forbes as a Best Startup Employer. The company is a leader in industry security and was the first technology company to join the Coalition to Stop Real Estate Wire Fraud. Qualia is headquartered in San Francisco, CA and has offices in Austin, TX, and Superior, CO. For more information on Qualia, visit www.qualia.com.