Consumers are knowledgeable about some aspects of the real estate process, but gaps in their housing knowledge persist, particularly when it comes to understanding the mortgage process as it relates to appraisals, credit scores, and federal loan programs, according to ERA Real Estate, which has a 13-question "Real Estate IQ" quiz on its site.
Homeowners and people over 30 scored higher than non-owners and people under age 30. Overall, the average score on the test was 73 percent.
Persons who purchased a home within the past year scored an average of five points lower than those who had bought a home more than two years ago, according to the results.
Charlie Young, president and CEO of ERA Real Estate, speculates that is a reflection of last year's fast-paced market, which was marked by price increases, bidding wars, and rising mortgage rates that increased urgency when completing a deal. The rush may have caused some buyers to fully understand the process.
Most of the respondents were familiar with foreclosures, short sales, and homeowner's insurance, according to the results. More than 90 percent of respondents, for example, knew the difference between homeowner's insurance and a home warranty. They also knew that homeowner's insurance was different than PMI.
However, only 67 percent of non-owners knew what an appraisal was, compared with 81 percent of owners. Also, overall, respondents showed a lack in knowledge of real estate market indicators - an opportunity for real estate professionals to use when educating their clients about local market conditions, according to ERA.