Online Real Estate Technology

Despite a general drop in home prices during the recession, home affordability problems persist for many Americans, according to recent data from The Urban Institute’s MetroTrends.

Home Affordability Problems Began During Boom
MetroTrends research indicates that during the boom years (roughly 2003-2007), unemployment was low in most of metropolitan America, but average earnings remained essentially flat. In the top 100 metros nationwide, average earnings grew only 1.2% from 2005 to 2007, after accounting for inflation.

And because real rents and house prices rose significantly during this period, housing hardship worsened. The share of households spending 30% or more of every month’s income on rent or mortgage costs climbed from 30% in 2000 to 40% in 2008.

Lower Prices Don’t Ease Problems
Since the recession started, unemployment has spiked, jumping from 4.6% among the top 100 metros in 2007 to 9.6% in October 2009. In addition, MetroTrends analysis indicates average earnings have declined, although 2009 data aren’t yet available, and house prices have plummeted.

However, average home prices remained 26% higher in 2009 than in 2000. And most families’ monthly rent or mortgage payments haven’t fallen because they haven’t yet moved or refinanced. At least for now, housing affordability problems are more prevalent, not less.

MetroTrends says one indication of deepening hardship in the downturn is the recent rise in food insecurity. Until 2007, about 11% of metropolitan households experienced food insecurity. But in 2008, this share climbed to almost 15%.

Coastal Metros Hardest Hit
Residents of coastal metropolitan areas have been especially affected by housing hardship. In metro Los Angeles, for example, the share of households with unaffordable housing cost burdens topped 50% in 2007. And in the Miami region, 53% of households lived in unaffordable housing.

Coastal areas of California, Florida and the Northeast and Mid-Atlantic have been especially hard hit. Twelve metropolitan areas in central and southern California have 43% or more of their population spending 30% or more of their income on housing costs. Florida has three metropolitan areas with 43% or more of their population spending this much on housing costs, as well as four areas with 37-42.9% of residents spending this amount.

The Northeast and Mid-Atlantic only have two metropolitan areas with have 43% or more of their population spending 30% or more of their income on housing costs, but have at least 10 metro areas with 37-42.9% of residents spending this amount. The only other state with a metropolitan area where 43% or more of residents spend 30% or more of their income on housing is Nevada (Las Vegas).

Hope for Improvement Exists
MetroTrends predicts that during the next five to 10 years, as the economy recovers and housing values stabilize, there’s a reasonable chance for better alignment of housing costs and incomes, because housing markets will likely recover without immediately forming another bubble. If house values increase moderately as employment and earnings gradually return to normal, more families will find their housing costs affordable. The lowest-wage workers still won’t find much housing that they can reasonably afford, however.

Short-term Unemployment Hits Mortgages Hard
While the long-term unemployed have suffered the most during the Great Recession, a recent survey from the Pew Research Center found that shorter spells of unemployment also have been painful for many Americans and their families.

For example, one-third of all long-term unemployed (33%) say they have had problems paying their rent or mortgage, identical to the proportion of those unemployed less than three months who experienced difficulty paying for housing.

However, this proportion is more than double the share of Americans who have not been jobless at any point during the recession but who have had difficulty paying for housing during the recession (16%).

A large California based real estate brokerage with more than 700 agents has announced a joint venture with a major international real estate franchisor this week.

Altgera Real Estate is forming a new company, Harcourts Pacific, with New Zealand based franchisor Harcourts International which has more than 630 offices and more than 4,000 agents in nine countries including New Zealand, Australia, South Africa, China, Fiji, Indonesia, Zambia, and Singapore.
Altera marks the company’s first venture in the United States, adding 23 independently owned offices and more than 700 agents to the franchise’s network. Real Trends ranked Altera Real Estate as No. 101 of the 500 largest brokerages in the country by sales volume in 2009.
Financial details about the transaction were not disclosed, though Mike Green, managing director for Harcourts International, said in a statement, ‘As a 50% shareholder in the US joint venture, Harcourts will have a heavy focus on the American market throughout 2010, as long term plans are put in place for further expansion in the country’.
Both Harcourts International and Altera Real Estate are part of the Leading Real Estate Companies of the World (RELO) organization.
Gary Thomas, one of Altera’’ founders, had met Harcourts executives more than a decade ago, and the franchise company first approached him about a partnership to expand into the US about five months ago, said Dennis Badagliacco, Altera’s president and now president of Harcourts Pacific.
He, his wife Colleen, and Thomas founded Altera in 2008. Both Colleen Badagliacco and Thomas are former presidents of the California Association of Realtors.
All Altera offices will retain their current branding, except any new materials ordered will have ‘a Harcourts company’ added next to the Altera name, he said. Altera asked to retain that branding as part of the deal. Any new franchises the company opens will be branded as Harcourts, he added.
‘We’ll be able to expand services in a geometric way for our agents. Right now, we have one person that handles agent interactions, marketing packages, and then does some educational classes,’ Badagliacco said.
From the Academy, agents ‘can learn to be an agent, in management, or a broker owner. (The agents) are going to take classes equivalent to college classes. There’s no other company in the world that does that that we know of,’ Dennis said.
‘For the training of agents, they don’t have just these one day seminars. They actually have classes in REOs, things like that. We had all of the same things, but didn’t have the volume or the depth that they did,’ he said.
Brokers will also get one on- ne training monthly, he said. Harcourts will also give agents free iPhone and iPad applications to work with. These will include an app for property search and for transaction management as well as listing presentations that can be given on an iPad, Badagliacco said.

Original story from Propertywire.com

Property prices in Australia could start to fall as a result of interest rate cuts and a cut back in mortgage lending, it is claimed. Despite prices increasing by up to 20% in the last year, a six interest rate rises in the last eight months could put the brakes on and there is evidence of a slowdown, experts believe.

REAL estate experts are bracing for the housing market to finally slow down, as the effects of the latest interest rate rise filters through to buyers.

According to Australia’s largest real estate group Ray White, turnover in the first three months of the year is sluggish compared with last year, up only 8%, the smallest increase since the global financial crisis.

The reduced activity has continued in to April, said Brian White, joint chairman. ‘Judging by our April results, it looks as if the interest rate increases are having an impact on activity. With the additional interest rate hike, it would be the first time that the Australian market has not shrugged off the pattern of increases in the past. At last, it would appear that the ambition of the Reserve Bank to slow down the residential activity has been achieved,’ he explained.

Another outcome of soaring prices is an increased in those struggling to make mortgage payments. According to independent interest rate monitor RateCity about 27,000 households have already missed mortgage repayments and thousands more are expected to fall behind after the latest interest rate rise.

The number of securitised home loans more than 90 days in arrears has rapidly increased from 0.05% in January to a current rate of 0.6% it said.

The worsening financial crisis in Europe could also affect the Australian market. Some analysts even believe there might be a rate decrease later in the year, although most are predicting they are likely to remain on hold.

‘There will be a slower housing market in Sydney in the second half of this year, even with a normal economy,’ said SQM Research managing director Louis Christopher. But he added that if the euro zone woes worsen there would be the potential for quarter on quarter falls at the end of the year.

Residex chief executive John Edwards believes price growth will moderate and he forecasts 5 to 8% overall. The top end of the market would do best, while some cheaper areas of south western Sydney were already going backwards.

According to Australian Property Monitors economist Matthew Bell prices in the most expensive half of the property market would rise at twice the rate of the bottom half.

Story from PropertyWire.com

Australian mortgage holders are a third time unlucky this year, after the Reserve Bank board today lifted interest rates by 0.25 per cent. It is the third rate rise in as many months.

Mortgage holders will be disappointed with the increase. After being told by the Reserve Bank Governor, Glenn Stevens, that rates were getting close to normal levels, borrowers would have been hoping the pace of rate rises had slowed. Today’s 25 basis point rise takes the official rate to 4.50 per cent.

It is the sixth increase since September and means mortgage holders are now paying about $300 a month extra for their mortgages than they were in the middle of last year, says Domain.com.au blogger and property author Carolyn Boyd. "There were a lot of mixed signals this month that may have had mortgage holders thinking they were in for a break. While inflation last week came in higher than expected, consumers have been spending less at the shops."

Until today’s decision, mortgage holders on variable interest rates were paying about 7 per cent to their lenders. The rates that borrowers pay to their financial institutions are expected to normalize at about 7.5 per cent to 7.75 per cent by year’s end.

That could signal there are still one or two more rate rises to come before Christmas.

The man who predicted the global credit collapse of 2007 has warned that Australia’s housing bubble is ripe to burst at any time.

US investment banker Edward Chancellor has told the Australian newspaper our economy is yet to emerge from the global financial crisis.

Mr Chancellor, who works for GMO, estimates Australian house prices are more than 50 per cent above their fair value.

He says house prices would have to fall ‘quite considerably’ to revert to their average price in relation to average income.

He also warned first home buyers were among the most vulnerable, saying the ratio of their mortgage repayments to their income would rise to ‘very high levels’ as interest rates continues to rise.

A potential trigger for economic trouble and the collapse of the housing market would come if China’s demand for iron ore and liquefied natural gas slowed, he said.

Original Story taken from www.bigpond.com

I recently received an email from the author of this post Chris Thorman about the potential that Geofencing technology has for the marketing of real estate in the future, and after reading his article I totally agree with him. This technology has huge potential in this country as we are mostly car bound and mobile, so you can imagine the impact of technology that reaches out to prospective buyers and virtually taps them on the shoulder. I hope you enjoy the article and if you’d like to read more on this you can visit Chris’s blog here

It’s Saturday morning. Joel and Rebecca are walking their dog through a neighborhood in Austin, TX. As they walk, they chat about the movie they saw last night, what they’re going to make for dinner, and the big trip they have planned for next weekend. You wouldn’t know it by listening to their conversation, but the couple is also house hunting.
They cross Brodie Lane when Joel’s cell phone buzzes in his pocket. It’s a text message that reads:

Joel says to Rebecca, “We’ve got a match from our real estate company. It’s only four blocks away. Let’s go see what the house looks like.”

Within minutes, the couple is outside the 714 Longview Rd. home. It happens to be exactly the type of home they wanted, in the exact neighborhood they wanted to live in. They call their real estate agent to set up a viewing.

How did this happen? How was the couple instantly notified of the opportunity, perfectly merging buyer requirements, location and timing? The answer involves a combination of “geo-fencing,” mobile phones and GPS technology.

If you’re a tech savvy real estate agent or property manager, this powerful combination of technology represents a great opportunity to gain new clientele. Many real estate buyers do not have the time to review new listings online, travel to viewings or patrol their desired neighborhoods for opportunities. But the vast majority of real estate buyers do have mobile phones they carry with them nearly all the time.

This technology would help real estate and property management companies capitalize on business that may otherwise slip through the cracks. Software Advice would like to see this type of mobile marketing become a permanent feature in today’s property management software systems to help advertise real estate and rental properties.

Let’s see how that could be done.

Geo-Fencing + Mobile Phones = Powerful Real Estate Marketing
What if a buyer looking for a place to live didn’t have to do anything beyond choosing what features they wanted in a home? What if a buyer was automatically alerted to nearby properties that matched their needs?

This is what we’re talking about with the next generation of mobile real estate marketing.

The use of “geo-fences” surrounding properties really drives the location-based marketing engine. A geo-fence is a virtual boundary surrounding a geographic region. When a person with a mobile phone crosses a geo-fence boundary, a notification is automatically issued to that mobile phone. Traditionally, geo-fencing has been used to send alerts when users exit a certain area, instead of entering one.

Geo-fencing has been used in conjunction with GPS technology for a while now and for a variety of uses:

• Tracking senior citizens with Alzheimer’s;
• Ensuring mobile employees don’t travel outside of certain areas; and,
• Monitoring hazardous cargo, to name a few examples.

We’re confident that someday, we’ll be able to add “Market real estate” to that list. Here’s how we see this new form of mobile marketing working in the real estate industry:

Create geo-fences. Before real estate and property management companies set up their online portals, they’ll need to create geo-fences around all of their properties. This will ensure that if a qualified user crosses the geo-fence with their mobile phone, that user will be notified about that property.

We’d like to see geo-fencing modules built into today’s property management software, allowing companies to quickly create geo-fences around their properties by drawing them on a digital map.

Collect buyer needs online. Real estate and property management companies can create online portals on their web sites, where prospective tenants and buyers set up notifications tailored to what they want in a property.

For example, a user could create an alert based on square footage, number of bedrooms, pet friendliness, special amenities, and zip code, to name just a few of the myriad of options available. Once they’ve entered their cell phone number and submitted those housing preferences, all they have to do is carry their phone with them to receive notifications.

We’d also like to see today’s property management software vendors integrate these online portals into their systems. Many property management software vendors offer web site design and hosting packages to their customers. A geo-fencing module could be another module that’s presented as an option to a management company when they purchase the software.

Let the notifications begin. The notifications are where this entire concept of location-based mobile marketing comes together. The geo-fences have been set up. Users have entered their housing preferences online to receive notifications. All that is left is for the users to go about their normal lives, with their GPS-enabled mobile phones, of course.

When they get close to a property that matches their wants, they’ll be automatically notified on their mobile phone. Property management software can then integrate all of these contact points with customers into their CRM system, to track the effectiveness of the messages and review properties with clients.

House hunting couldn’t get much easier than that, could it?

The Benefits
Hopefully by now, the benefits of this unique marketing method are clear.

First, since the user opts in to receive these marketing notifications, there is no feeling of intrusiveness or annoyance as with unsolicited messages. This type of marketing is perceived as a service, not an intrusion.

Second, from a marketing standpoint, notifying the right person, at the right place, at the right time about your product is powerful.

It’s the holy grail of marketing:

• You have a desirable product;
• You have identified the person that wants your product; and,
• You can automatically tell that person that your product is nearby.

Finally, this marketing method is scalable. A real estate or property management company could theoretically have dozens (or more) of users taking advantage of this service at any given time. Beyond taking calls to schedule viewings, it wouldn’t require any extra labor on the part of the management company.

Conclusion
We don’t expect this spin on mobile marketing to be installed in every real estate and property management office tomorrow. But whether through geo-fence triggers or other GPS-centric methods, the real estate industry will undoubtedly continue to make a huge effort over the next few years to connect with buyers and renters through their mobile phones.

The technology is too compelling to ignore.

Ian Grace Mr Real Estate Advertising

I thought it was time I opened up this blog to a few of my friends and colleagues in the real estate industry and one that I’ve had the pleasure to work with over the years is probably the leading expert on real estate advertising worldwide, Ian Grace.

Ian has presented his training course all over the world and is one of the very few Australians to have spoken at the NAR conference in the US, there is not much that Ian does not know about creating great real estate advertising, so as part of this series, I’ve asked Ian to put together his top 10 tips for writing great real estate ads, I hope you get benefit from Ian’s advice.

The Top Ten Tips for Writing Great Real Estate Ads

HOODOO – a great word to help you to remember the two things that make advertising effective:- WHO – is the person who will see the most value in the property and therefore pay the highest price [that's target marketing]. DO – now show them and tell them, what they will be able to DO as a direct result of their purchase.

2. HEADLINES – remember the WHO when you write your headline, then qualify it quickly, so the reader knows you’re both on the same wavelength. Then ideally, reinforce or remind about the headline at the end of the ad. The headline must include one or more of the following:- 1. A benefit or implied benefit 2. Something that is new, news or topical 3. A curiosity element without gimmicks for gimmicks sake.

3. PHOTOS – make sure your main photo matches and works together with your headline [not the other way around] and that the other photos also match the body text.

4. PEOPLE – put people and/or pets in your photos – it’s a great way to show people what they will be able to DO when they live there.

5. NAMES – use names in your ads to personalise them – yours [in full] and even the sellers’.

6. DIFFERENT ADS – the use of different ads for different markets, enables you to talk to each prospect group about what is relevant to them only e.g. one ad aimed at first home buyers and one ad aimed specifically at investors.

7. MEDIA MATCH – make sure your press ads match with other media and vice versa, with particular reference to the main photo and headline.

8. KEEP THE SAME AD RUNNING – once you’ve written a great ad, run it at least four times if not more, as research shows people need to see the same ad or message three times or more, on average, before they will respond

9. PRICE, LOCATION, NUMBER OF BEDROOMS – if all the research done shows conclusively that these are the top three pieces of information potential buyers require, then common sense says – give it to them!

10.   OBTAIN SELLER ADVERTISING DOLLARS – research proves that the higher the seller paid advertising percentage, the higher the listing to selling success rate.

11. BONUS TIP – TEST YOUR ADS – Firstly, sellers must see the ads before they run, but most importantly, ensure at least one of your colleagues checks your ads to confirm every word and phrase will make sense to the market it is written for. Secondly, when buyers who have responded to the ads view the property, ask them if the property has matched their expectations from your ads – the feedback will be terrific and will keep your advertising right on track.

If you’d like to contact Ian you can visit his web site Ian Grace Marketing

Having just gone through the process of buying and selling our family home, I could relate to this video. The real estate agent who handled both of our transactions did not fall into this category but I had to laugh when I watched it, so please enjoy it before it gets removed.

Google and Real Estate

For those of you who are interested in Googles ultimate goal for its real estate listings service, they have finally announced their plans for the service. In New York, Sam Sebastian, the company’s director of local and business-to-business markets has told the Inman technology conference that Google’s recent refinements in the real estate space, which include creating “place pages” for individual listings, don’t mean the search engine giant is moving to create a national multiple listing service.

He said the recent refinements have improved the quality of traffic the search engine delivers to advertisers — including big brokerages that Google is out to sign up as clients.

“Agents have always been pretty engaged” in buying keywords and targeted ads from Google to drive traffic to their Web sites, Sebastian said. “But the big brokerages that can really do this in scale, and work this into their marketing programs — that’s where I think the future is.”

Since Google got into targeted advertising, agents and small real estate offices have been “very entrepreneurial” in taking advantage of its ability to deliver potential clients, Sebastian said.

“They could compete with the big boys, and we were building a good set of users,” Sebastian said. Then third-party listing aggregation sites emerged, packaging and selling the leads traffic to their sites generated to brokers and agents.

Google got into the listing game itself, through its Google Base service, which accepts listings from agents and third-party aggregators.

Aggregating listings is not nearly as controversial as it was when third-party aggregators started cropping up more than a decade ago, Sebastian said.

But Google has captured the attention of the real estate industry in recent months by creating individual “place pages” for listings and making it easy to find them in map-based searches

Place pages, Sebastian said, were originally created not for real estate, but as a way to give local merchants a presence on Google. Place pages pull content from around the Internet, such as reviews, photos and other information Google has tracked down, organizing it in one place.

When the implications for real estate became clear — that Google, in theory, could amass a database of every property on Earth — not everybody in the industry was thrilled with the idea.

“We got a little bit of hemming and hawing,” Sebastian said. Some wondered if Google was taking the first step in building a national MLS, he said.

But the sites providing the information indexed by Google are finding that the quality of traffic the search engine delivers to their site has improved.

The plan was not to take business from real estate brokers, but to provide a better user experience, Sebastian said.

“It’s not some evil plan we have in Mountain View (Google’s headquarters in California), with millions of folks talking about how we want to take over the real estate markets,” Sebastian said.

Asked about reports that Google has been talking to real estate search site Trulia.com about an acquisition, Sebastian said he could not comment. (A Trulia spokesman told Inman News in December that the company “does not comment on rumors or speculation.”)

But Sebastian did say that Google is likely to continue acquiring one to two “small and nimble” companies a month, a pace it’s kept up for the last 18 months.

Source: Inman News

During my research I’ve come across a great video that I thought I would share with you, the video was compiled by Socialnomics09, and is called Social Media Revolution: Is Social Media a Fad?

For those real estate business owners that have yet to consider social media as a business strategy then hopefully this will provide some insights into the On Line world of the future. This video details some facts and figures that are hard to ignore.

I’ve been like a voice in the wilderness promoting the value of a social media within the real estate industry in Australia so hopefully this video will add some weight to my voice.

If you do decide to adopt a social media strategy for your office, make sure you get someone who knows what they are doing, read my post on Fake Social Media Experts before you get fooled to part with your hard earned dollars by these so called experts, or better still, give me a call.

Please enjoy