11th May 2008
MEDIA RELEASE - EMBARGOED UNTIL MIDNIGHT
New Research Shows Home Buyers & Sellers Greatly Influenced By Media Reports
Media stories on real estate trends and the affect they have on buyer and seller behaviour has been monitored for the
first time and the results show the impact is immediate and significant.
“We all know buying a home is the most expensive purchase most of will ever make and one fraught with uncertainty and
complexity. So it’s quite incredible decisions around it can be so dramatically influenced by media stories”, said the
study’s author Alistair Helm, the CEO of www.realestate.co.nz
The Real Estate Industry turned over $34 billion in the past 12 months, transacted by over 16,000 agents. The NZ real
estate asset base is valued at $420 billion*.
For the first time research shows that a series of negative headlines can send interest in property buying into a nose
dive.
The study monitored 7 websites (the major portals and real estate company websites in NZ) over a two year period from
January 2006 until the end of April 2008.
The most dramatic data showed the steep fall-off of traffic to these websites from the middle of February2008 -
significantly off the seasonal trend (see graph).
This date in February correlates exactly with speculative media stories predicting 20%-30% correction in property prices
around the release of the real estate industry’s January sales figures.
The website traffic clearly shows the market was spooked by headlines such as PROPERTY MARKET SET TO CRASH SAYS EXPERT
and CONFIRM PROPERTY SLUMP BEDDED IN (13 February 2008), HOUSE SALE LOW IS SIGN THE TUMBLE HAS STARTED (14 February
2008), SHADES OF THE 80s IN HOUSING OBSESSION (16 February 2008).
Click to enlarge
Litmus Test: Now that the internet has taken over as the most valuable source of real estate information traffic to
websites has become a new industry gauge of consumer behaviour.
The study also revealed a significant drop off in the number of new houses being listed for sale from early March.
The number of homes for sale being listed was close to 1,000 a week in January and February on www.realestate.co.nz but
throughout March the total number of listings stayed static at around 109,000.
“The likely factor behind these figures is the combination of property being withdrawn from sale and owners reluctant to
enter this very slow market”.
“Given the size of the industry and its importance to the NZ economy as well as each homeowner this study showing the
extent of the media’s influence is quite a wake-up call”.
“Perhaps it’s time the industry began to provide its own media and look at directly connecting with customers by way of
blog and email alerts and being more open with the major media by providing regular and expert insight into the state of
the market”
For the whole story:
Click on UNCONDITIONAL (after 4pm) http://www.realestate.co.nz/blog/
www.realestate.co.nz is the official website of the real estate industry and the largest property website in NZ with
109,000 listings..
ENDS