Real Estate Agents Authority

1. Real Estate Agents Authority Annual Perceptions Research JUNE 2014

2. Introduction The objectives of this research are to: Understand consumer perceptions of the real estate industry. Ask those who have had a real estate transaction within the last year, their views on the process and their perceptions of their real estate agent. In order to get an understanding of perceptions of the real estate industry among the general public, four questions were added to Nielsen’s Online Omnibus which ran from 29 May to 4 June 2014. Note: The Nielsen Omnibus runs fortnightly and surveys 700 people from the New Zealand population. The sample is structured so that it is representative of the New Zealand population by age, gender and region. The final sample is then weighted to make any necessary adjustments. A separate stand-alone survey was conducted online between 29 May and 4 June 2014. This survey was only asked of those who had bought a property, sold a property, put an offer on a property or received an offer in the last 12 months, and asked specific questions about the process and materials offered by the REAA. Loose regional quotas were used to ensure a range of geographic areas were covered. Quotas were not set for age or gender as there are natural skews given the type of people being surveyed. The approach and questions were the same as that used in 2012 and 2013, enabling comparisons between the measures. Note however any references to ‘house’ in both the Omnibus and stand-alone surveys have been changed in 2014 to ‘residential property’ instead. This is to ensure that those who bought, sold, received or put an offer in on any residential property other than house (e.g. an apartment or townhouse etc.) are not excluded from the survey.

3. Notes to the report • All differences mentioned in this report are statistically significant at a 95% confidence interval. This means that the difference is a true difference statistically and not due to random variation. • When subgroup differences are mentioned in the text boxes, the results outlined are always in comparison to the total result of all those who answered the question unless stated otherwise. • For example, in slide 6 it says ‘Those aged over 55 years (77%) are more likely to be aware of the REAA’. • This means that 77% of those aged over 55 are aware of the REAA, which is significantly different from the total population in which 70% are aware of the REAA.

4. Perceptions of the Real Estate IndustryResults from the Nielsen Online Omnibus reflective of the New Zealand population

5. Overview As in the previous 2 measures, 7 in 10 have at least heard of the Real Estate Agents Authority. About a tenth (12%) know a reasonable amount about what REAA do, while not statistically significant, it appears to be increasing slightly over time. Awareness continues to be higher amongst older New Zealanders. A third of New Zealanders continue to be confident that the Real Estate Industry is professional. A slightly lower proportion (two in ten), are confident it is fair and well-monitored. Among those aware of the REAA, the majority (75%)think it makes a difference to their consumer protection when buying or selling a property. Just over half (56%) of New Zealanders have at least some knowledge of their rights and obligations with respect to real estate transactions, a similar result to the previous two measures. Those who know more about the REAA continue to be more likely to say they have more knowledge of their rights and obligations.

6. do people know about REAA? The majority have heard of the REAA and this proportion has remained stable over the last three measures. A tenth (12%) know a reasonable amount about what they do, while not significant, it appears to be increasing over time. Those with a personal income of $80,000 or more (89%) or $60,000 to $79,999 (88%), older with no children (83%) aged 40 years and older (77%), or working full time (77%) are more likely to be aware of the REAA (compared to the total result of 70%). Those who are aged 15 to 24 (46%), not a main household shopper (51%), from a household with children aged 16+ (58%), or unemployed (63%) are less likely to be aware of the REAA. NET 2014: 70% NET 2013: 70% NET 2012: 70% % AWARE OF THE REAA Q2. Do you know what the Real Estate Agents Authority (REAA) does? % Significantly higher / lower than the total result Base: All respondents

7. What do they think of the REAL ESTATE INDUSTRY? A third of New Zealanders continue to be confident that the Real Estate Industry is professional (rating it 4 or 5 out of 5 with 5 being a lot of confidence). A quarter believe it is well-regulated, while one in five are confident that the industry is fair and well-monitored. Those who are aged 40 to 54 years old (26%) are more likely to say they are not confident the Real Estate Industry is professional (compared to the total result of 20%), as are those from a household with an income of $100,000 or more (29%). 33% Those who are from a household with an income of $19,999 or less (8%) are less likely to say the Real Estate Industry is well-regulated (compared to the total result of 25%). While those who are aware of the REAA (30%) are more likely to say this. 25% Those who are aged 40 to 54 years old (40%) are more likely to say they are not confident in the Real Estate Industry is fair (compared to the total result of 34%), as are those who are working full time (38%) or from a household with an income of $100,000 or more (45%). 22% Those who are aged between 15 to 24 years old (30%) are more likely to say the Real Estate Industry is well-monitored (compared to the total result of 22%), as are those who are aware of the REAA (26%). 22% Q1. To what extent do you have confidence that the Real Estate Industry in NZ is … % Base: All respondents 2014 (n=701)

8. How does this compare to last year? As in the previous two measures, New Zealanders confidence with the Real Estate Industry being professional continues to be highest amongst all attributes. % 4 or 5 – A lot confidence Q1. To what extent do you have confidence that the Real Estate Industry in NZ is … % Base: All respondents

9. Confidence in the Industry by AGE Ratings for ‘well monitored’ have dropped significantly amongst those aged 55+ (from 33% in 2013 to 23% in 2014). Professional % rated 4 or 5 out of 5 Well regulated % rated 4 or 5 out of 5 Fair % rated 4 or 5 out of 5 Well monitored % rated 4 or 5 out of 5 Significantly higher / lower than in 2013 Significantly higher / lower than the total result Base: All respondents 2014 (Total n=701, 15 to 24 n=170, 25 to 39 n=187, 40 to 54 n=179, 55+ n=165)

10. Confidence in the Industry by region There are no significant differences by region or changes in confidence over time. Professional % rated 4 or 5 out of 5 Well regulated % rated 4 or 5 out of 5 Fair % rated 4 or 5 out of 5 Well monitored % rated 4 or 5 out of 5 Significantly higher / lower than the total result Base: All respondents 2014 (Total n=701, Auckland n=247, North n=151, Central n=134, South n=169)

11. Confidence in the Industry by awareness of REAA Those who are not aware of the REAA continue to have lower confidence in the industry. Professional % rated 4 or 5 out of 5 Well regulated % rated 4 or 5 out of 5 Fair % rated 4 or 5 out of 5 Well monitored % rated 4 or 5 out of 5 * Warning small base size Significantly higher / lower than the total result • Base: All respondents 2014 • (Total n=701, know a reasonable amount n=78*, know a little n=195, heard of but know nothing about n=203, never heard of n=225)

12. DO they think the rEAA MAKEs A DIFFERENCE TO CONSUMER PROTECTION IN BUYING OR SELLING A property? While two thirds (75%) of those who know at least a little about what the REAA does say that REAA makes at least some difference to their consumer protection when buying or selling a property, this proportion has dropped slightly from the previous measure (to a similar result to 2012). Those with a personal income of $60,000 to $79,999 (46%) are more likely to say that the REAA makes a difference (compared to the total result of 29%). Those who are from a household with an income of $40,000 to $59,999 (12%) are less likely to say this. % rated 4 or 5 out of 5 74% 75% 81% * Warning small base size ** Warning VERY small base size Q3. What difference do you think the Real Estate Agents Authority makes to your consumer protection when buying or selling a property? % • Base: All respondents who know what the Real Estate Agents Authority (REAA) does

13. Do new zealanders know their rights and obligations in real estate transactions? Knowledge of their rights and obligations with respect to real estate transactionsremains stable. Those who know a reasonable amount about what the REAA does (39%), have a personal income of $60,000 to $79,999 (26%) or a household income of $80,000 to $99,999 (24%) or aged over 55 (22%), are more likely to say they have knowledge of their rights and obligations with respect to real estate transactions (compared to the total result where 14% rated their knowledge 4 or 5 out of 5). Those who have heard of the REAA but know almost nothing, those who have never heard of them, and are aged 15 to 24 years old are less likely to say this (10%, 3% and 7% respectively rated their knowledge 4 or 5 out of 5). 56% 54% 55% % rated 4 or 5 out of 5 Q4. Do you consider you have enough knowledge of your rights and obligations with respect to real estate transactions? % • Base: All respondents Significantly higher / lower than the total result

14. Does KNOWLEDGE of RIGHTS vary by knowledge of reaa? The majority of those who know a little bit or a reasonable amount about the REAA continue to be more likely to feel that they have at least some knowledge of their rights and obligations with respect to real estate transactions. 29% 56% 55% 71% 82% Significantly higher / lower than the total result Q4. Do you consider you have enough knowledge of your rights and obligations with respect to real estate transactions? Q2. Do you know what the Real Estate Agents Authority (REAA) does? % • Base: All respondents 2014 • (Total n=701, know a reasonable amount n=78*, know a little n=195, heard of but know nothing about n=203, never heard of n=225) * Warning small base size

15. And Compared WITH 2013? The proportion who know a little bit about the REAA and have at least some knowledge of their rights and obligations with respect to real estate transactions has returned to the 2012 level. % Rated Knowledge of Real Estate Transactions Rights and Obligations (4 or 5 out of 5, with 5 being A lot of Knowledge) I have never heard of them I have heard of them but know almost nothing about what they do Total I know a little about what they do Yes, I know a reasonable amount about what they do Q4. Do you consider you have enough knowledge of your rights and obligations with respect to real estate transactions? Q2. Do you know what the Real Estate Agents Authority (REAA) does? % Base: All respondents

16. Perceptions of the real estate transaction process and ratings of real estate agentsResults from the stand alone survey asked only of those who have had a real estate transaction in the last year

17. Overview The proportion of those who sold a property and recall receiving the New Zealand Residential Property Agency Agreement guide (70%)has decreased significantly since 2013 (83%), going back to 2012 levels (69%) The majority however, still found this guide to be at least somewhat useful. While around two thirds (61%) of those who should have received the New Zealand Property Sale and Purchase Agreement Guide do recall receiving it – this figure has decreased significantly from 2013 (78%). Nonetheless, the majority found the guide at least somewhat useful. Around three in ten (29%) visited the REAA website. As to be expected, website visitors are more likely to be those of younger age group, aged under 40 years old (43%). The majority (83%) of which say information in the REAA website has helped them make informed property decisions. The majority (90%) continue to feel at least somewhat empowered and able to participate effectively in their real estate transaction. This is particularly evident among those who bought or sold a property. While overall ratingsof the real estate agent are still quite positive, there are some significant decreases since 2013, bringing ratings back to 2012 levels. A good spread of the various real estate transactions was achieved in this survey with 46% who bought a property, 34% who put an offer on a property but didn’t end up buying it, and 13% who received an offer but didn’t end up selling it in the last 12 months. The proportion who sold a property (29%) however, has decreased significantly (39% in 2013).

18. What have they done in THE LAST 12 MONTHS? The proportion who have sold a property has decreased significantly from the previous measure. While the proportion who had put an offer in on a property but didn’t end up buying it, has increased from the previous measure, this is not a statistically significant change. • Females (54%) are more likely to have bought a property in the last 12 months (compared to the total result of 46%) • Those who are aged 55 years and over are more likely to have sold a property in the last year (45% cf. 29%), as are New Zealand Europeans (35%) or those who are retired (60%) • Those who are working full time are more likely to have put an offer in a property but didn’t end up buying it(43% cf. 34%). Significantly higher / lower than in 2013 Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? % • Base: All respondents

19. Is THE residential property agency AGREEMENT GUIDE USEFUL? Over two thirds (70%) of New Zealanders who sold/put an offer on a property received a copy of the New Zealand Residential Property Agency Agreement Guide (this has decreased significantly since the previous measure). Of those who said they received a copy, the majority continue to found this guide to be at least somewhat useful. 25% rated the guide 4 or 5 in 2014, compared to 24% in 2013 and 26% in 2012 Q2. Prior to agreeing a contract with the real estate agent for the sale of your property did you receive a copy of the New Zealand Residential Property Agency Agreement Guide from your real estate agent? % YES Q3. Did you find the guide useful? % 70% Yes Base: Those who have sold a property or received an offer for a property in the last year and recall receiving the New Zealand Residential Property Agency Agreement Guide 2014 (n=64*) Base: Those who have sold a property or received an offer for a property in the last year Those who sold a property (78%), aged 55 years or over (80%) are more likely to recall receiving the Property Agency Agreement Guide (compared to the total result of 70%). Those who remember receiving this Guide are also more likely to recall receiving the NZ Residential Property Sale and Purchase Agreement Guide (84%). Significantly higher / lower than in 2013 * Warning small base size

20. Is the Property sale and purchase agreement guide useful? Around three in five (61%) recalled receiving a copy of the New Zealand Residential Property Sale and Purchase Agreement Guide prior to accepting/making an offer on a property- a significant decrease from 2013. Of those who recalled receiving it, the majority (92%) found it to be at least somewhat useful. 31% rated the guide 4 or 5 in 2013 and 2014, compared to 27% in 2012 Q5. Did you find the guide useful? % Q4. Prior to making, or accepting an offer on a residential property did you receive a copy of the New Zealand Residential Property Sale and Purchase Agreement Guide from your real estate agent? % 61% Yes Base: Those who recall receiving the New Zealand Residential Property Sale and Purchase Agreement Guide 2014 (n=134) Base: All respondents Those who feel empowered (45%) are more likely to rate this guide 4 or 5 compared to the total result of 31% Those who have bought a property in the last 12 months (74%) are more likely to recall receiving the NZ Residential Property Sale and Purchase Agreement Guide (compared to the total result of 61%), as are those who received a copy of Property Agency Agreement Guide (84%) or those who feel empowered (71%). Significantly higher / lower than in 2013

21. Who Received A COPY OF THE S&P Agreement GUIDE? Those who bought a property continue to be the most likely to recall receiving a copy of the Sales & Purchase Agreement Guide. However, the proportion who recalled receiving a copy of the Guide has decreased significantly since 2013 across all groups. % who recall receiving a copy of the Guide Significantly higher / lower than in 2013 Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? Q4. Prior to making, or accepting an offer on a residential property did you receive a copy of the New Zealand Residential Property Sale and Purchase Agreement Guide from your real estate agent? % Base: All respondents

22. How Empowered Do people feel? As in previous measures, the majority continue to feel at least somewhat empowered and able to participate effectively in their real estate transaction. The proportion who do not feel empowered (1+2) has decreased significantly from 13% in 2012 to 7% in 2014. 92% 90% 87% Those of New Zealand European ethnicity (56%), those who are aged 55 years or over (63%), or retired (67%) are more likely to feel empowered (rated empowerment 4 or 5 out of 5 compared to the total population 49%). Likewise, those who recalled receiving the Property Sale and Purchase Agreement guide (56%) or bought a property in the last 12 months (57%) are more likely to feel empowered. In contrast, those aged 25-39 (35%) and those who have visited the REAA website (38%) are less likely to feel empowered (cf. 49%). Q6. Overall, did you consider yourself empowered and able to participate effectively in the real estate transaction? % Base: All respondents

23. Does empowerment vary by transaction? Those who received an offer for a property but didn’t end up selling are most likely to not feel empowered and able to participate effectively in the real estate transaction. 2012 2013 2014 51% 56% 49% 49% 59% 71% 60% 60% 60% 64% 57% 57% 43% 40% 34% 34% 43% 59% 31% 31% * Warning small base size ** Warning VERY small base size Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? Q6. Overall, did you consider yourself empowered and able to participate effectively in the real estate transaction? % Significantly higher / lower than in 2013 Significantly higher / lower than the total result Base: All respondents 2014

24. What do they think of their real estate agent? While overall ratings of real estate agents continue to be positive (with at least half rating them excellent or very good on all of the attributes), ratings of attributes have dropped from 2013 back to 2012 levels. In the current measure, ‘being professional’ is the highest rated attribute. While ‘explaining the process clearly’, the top rated attribute in 2013, dropped significantly from 68% to 54% in 2014. % who rated ‘excellent’ or ‘very good’ 2014 2013 2012 66% 56% 60% 63% 55% 57% 68% 54% 56% 65% 53% 54% 64% 51% 51% 62% 50% 52% Significantly higher / lower than in 2013 Those who live in the Central region are more likely to rate their real estate agent as ‘excellent’ or ‘very good’ rating at explaining the process clearly (66% cf. 54%). Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… % Base: All respondents 2014 (n=218)

25. Does the RATING OF real estate agents vary by empowerment? Those who feel empowered are more likely to rate their real estate agent ‘excellent’ or ‘very good’ on all attributes. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ ** Warning VERY small base size Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q6. Overall, did you consider yourself empowered and able to participate effectively in the real estate transaction? Significantly higher / lower than the total result Base: All respondents 2014

26. WHAT DO THOSE WHO ARE EMPOWERED THINK OF THEIR AGENT COMPARED TO THE PREVIOUS MEASURE? Rating of attributes among those who are empowered at similar levels to those seen in 2012. The rating of ‘being knowledgeable about legal requirements’ has dropped significantly from 78% in 2013 to 66% in 2014. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ Significantly higher / lower than in 2013 Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q6. Overall, did you consider yourself empowered and able to participate effectively in the real estate transaction? Base: Those who felt empowered – rated 4 or 5 out of 5

27. Does the RATING OF real estate agents vary by transaction type? Those who sold a property in the last 12 months are overall more positive towards their real estate agent. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ Significantly higher / lower than the total result * Warning small base size ** Warning VERY small base size Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? % Base: All respondents 2014

28. What do THOSE WHO BOUGHT A PROPERTY think of agents compared to 2013? While around half of respondents rate their agents very good or excellent, ratings in all attributes have decreased significantly compared to the previous measure for those who bought a property. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ Significantly higher / lower than in 2013 * Warning small base size Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? %

29. what do Those who sold a property think of agents compared to 2013? Ratings of attributes are consistent with the previous measure. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ * Warning small base size Significantly higher / lower than in 2013 Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? %

30. what do those who submitted AN OFFER BUT DIDN’T END UP BUYING think of agents compared to 2013? Ratings of attributes are consistent with the previous measure. % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ Significantly higher / lower than in 2013 Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? % * Warning small base size

31. what do those WHO RECEIVED AN OFFER BUT DIDN’T SELL think of agents compared to 2013? Ratings of ‘acting ethically, honestly and openly’ have increased slightly for those who received an offer compared with the previous measure (however the differences are not statistically significant due to the small sample sizes). % Rated Real Estate Agent ‘Very Good’ or ‘Excellent’ Significantly higher / lower than in 2013 Q7. Thinking about when you bought, sold, received or put an offer in on a residential property, how would you rate your real estate agent in terms of… Q1. Have you in the last year bought, sold, received or put an offer in on a residential property using a real estate agent? % • ** Warning VERY small base size

32. Usage of website Almost three in ten (29%) people who have had a real estate transaction in the past year visited the REAA website. The majority of whom say information in the REAA website has helped them make informed property decisions. Those aged under 40 years old (43%) are more likely to have visited the REAA website compared to the total result of 29%, as are those who are frequent users of Twitter (49%) or YouTube (35%). 29% SAID THEY VISITED THE REAL ESTATE AGENTS AUTHORITY’S WEBSITE 83% OF THOSE WHO VISITED THE WEBSITE, THE MAJORITY (83%) SAID THAT INFORMATION IN THE REAA WEBSITE HELPED THEM IN MAKING INFORMED DECISIONS IN RELATION TO THEIR PROPERTY Q20. Did you visit the Real Estate Agents Authority’s website? Q21. Did the information help you to make an informed property decision? Base: All respondents (n=218) Base: Those who visited the REAA website (n=64*)

33. Use of social media channels Over eight in ten people who have had a real estate transaction in the past year use YouTube (83%) or Facebook (80%), while 37% use LinkedIn and 28% use Twitterat least some of the time. % SEVERAL TIMES A MONTH OR MORE OFTEN (Daily, Several times a week, Once a week, Several times a month) % AT LEAST SOME OF THE TIME (Daily, Several times a week, Once a week, Several times a month, Once a month, Less often than once a month) % ONCE A WEEK OR MORE OFTEN (Daily, Several times a week, Once a week) Base: All respondents (n=218) Q22. How often do you use the following social media channels? (Daily including weekends, Several times a week but not daily, once a week, several times a month but not weekly, once a month, less often than once a month, never).