Customer Satisfaction Improves Significantly, Driven by Competition among Home Builders

RISMEDIA, September 17, 2009—As home builders compete for a limited pool of buyers, customer satisfaction with new-home builders and new-home quality have improved notably from 2008, according to the J.D. Power and Associates 2009 U.S. New-Home Builder Customer Satisfaction Study.

Overall customer satisfaction improved for a second consecutive year, averaging 811 on a 1,000-point scale in 2009, and up 32 points from 779 in 2008. Markets with the highest levels of overall satisfaction in 2009 include Orange/San Diego, Calif.; Sacramento, Calif.; Phoenix, Ariz.; Inland Empire, Calif.; and Tampa, Fla.. In addition, overall satisfaction has increased in 22 of the 23 individual markets that were also surveyed in 2008.

New-home quality has also increased notably to an average of 825 index points in 2009from 799 in 2008. The rate of customer-reported problems has decreased in 2009 to an average of 9.55 problems per home, from 11.51 problems per home in 2008. Problem rates have declined in each of the 23 markets that were also included in the study in 2008. Overall, the most commonly reported quality problems include issues with landscaping, heating and air conditioning problems and kitchen cabinet quality and finish.

“Fierce competition among home builders has led to a market where only the strongest companies have survived,” said Paula Sonkin, vice president of the real estate and construction industries practice at J.D. Power and Associates. “This is great news for new-home buyers—particularly first-time buyers—since builders are offering unprecedented high levels of quality, value and service at relatively low prices.”

The New-Home Builder Customer Satisfaction Study, now in its 13th year, includes satisfaction rankings for builders in 24 markets. Nine factors drive overall customer satisfaction with home builders: workmanship/materials; builder’s warranty/customer service staff; price/value; builder’s sales staff; construction manager; home readiness; recreational facilities provided by the builder; builder’s design center; and location.

The study found that the importance of the workmanship and materials factor has increased notably from 2008. Meanwhile, the builder’s sales staff, construction manager and home readiness factors have declined in importance.

“Compared with past years, fewer home buyers are spending large amounts of time working with construction managers or are concerned about home readiness, since many builders have large inventories of homes that are already complete at the point of purchase,” said Sonkin. “For home owners, this can make for a smoother, turnkey ownership experience, with fewer unanticipated delays.”

Source: rismedia.com