I recently read a post titled "30 Web Trends for 2009″ that got me thinking about the top real estate trends in 2009. What's becoming or going to become the hot new thing, tool, technology, or technique in real estate for the coming year? I think ‘readers want to know...' Plus, its a great thing to go back to and either say, Wow, I was right on there." or "Man, I didn't know what I was talking about." So, here's what I see as the major trends to watch for in 2009 real estate.
Let's break it down by
- The 2009 Market
- Legal Issues
- The Internet
- Buyer and Seller Mindsets
The 2009 Real Estate Market
Are we far off a bottom or has it already passed? This is the topic it seems every news agency is trying to pin down from CNBC to Inman. There are so many variables when trying to intelligently predict a bottom and the up swing in the home market. Is it when inventory falls, when prices stagnate, when housing starts go back up? Without beating a dead horse, my personal opinion on the national market is that we are 6-9 months from the beginning of a bull or positively trending cycle. It will depend on public perspective as to how long this really takes.
Local Northwest Arkansas Real Estate Market
Real estate is a local business. I don't sell real estate in Dubai because I don't know much about Dubai and would be doing my clients a disservice. I know Northwest Arkansas real estate and I know that this market is much healthier than the average national market. Corporate insulation, population growth, and a general feeling of being a better place to live makes Northwest Arkansas on the cusp of a positive real estate market. Some numbers indicate that we may have already hit bottom and are looking at a very good spring. Other numbers indicate (because of the high number of foreclosed properties flooding the market) we still have some months to go. All I have to say is: interest rates are at historically low levels, housing prices are affordable, inventory is high . . . what in the world are you waiting for? If you are waiting on the bottom you may miss it by a mile because indicators always lag behind (by as much as 6 months). Go out and get the house you want. Can't because your home won't sell? Price your home properly, expose your home properly, and it will sell. The money you lose on the home for sell will be offset by the money you save on a low interest rate and low home price. Think about it.
I see contracts getting even longer. Arkansas' current contract sits at 10 pages in 2008 for the basest paperwork. 2009 may not add pages, but we may see additional disclosures and addendum the must be signed on both the buyer's and seller's sides.
Banks and Mortgage Brokers
I think we all see what's going on here. Banks are going to be much more heavily regulated to stop predatory lending practices and high risk lending. Fannie Mae and Freddie Mac are going to have to lead the way (even though they are somewhat to blame for getting us in this mess in the first place). We'll have to see how the bailout progresses over the next few months. A word of advice, keep up your credit score if you are looking to borrow money in the near term or employ a credit repair company to help.
It has already happened. Realtors are getting blamed for poor purchase decisions by clients. Banks and REO companies are even suing Realtors that have turned in price opinions that are way off the mark. Realtors need to practice their due diligence, research the information they give their clients ahead of time, and be able to back up the advice they give. I expect this to be a focus of training in brokerages and franchises across the nation in 2009.
Less is more
I think the trend has already begun. Minimalist, efficient brokerages like FavoriteAgent are popping up at quite a rate. With commercial space rental prices, on-going expenses, and more agents working from home, big brokerages with big desk fees and low splits are on their way out (or at least being handed their hat).
Training gets beefed up
As more part-timers get weeded out and professionals struggle in a tough market training will become essential for survival. Look for lots of training offered by franchises (EXIT, RE/MAX, Century 21, etc.) If they don't train their agents to stay around they'll go somewhere that will. Webinars, conferences, MLS boards, in-house - it's a great time to be an industry trainer. Look for some brokerages to front or completely cover the cost to keep struggling agents above water.
Technology and Social Media
Brokerages will finally get on the bus in 2009 and start offering smart solutionsfor their agents. Blogging, Web video, social network solutions and aggregation. Watch for brokerages to start training on these and other topics that aren't just fluff but help bring in real business. More brokerages will begin offering their agents and clients automated solutions that syndicate listings to Trulia, Hotpads, Zillow, Frontdoor, Craigslist, and whole lot more than just Realtor.com and their local mls.
Information will flow . . .
Ever heard the term ‘the cup runneth over?' That's what is already beginning to happen with real estate on the Internet. Companies like Zillow, Trulia, Homes.com, and Realtor.com will add more features to help consumers find homes, neighborhoods, and schools. Many have already gone to map based search solutions (think Google Earth) and many more will follow. There seems to be a war on to get agents to list their homes on a company's site and pay premiums for additional features and exposure for themselves and their clients. I expect there will be some players emerge as the top dogs with many mergers and deals in 2009.
Real estate is ready for video to go mainstream.
There are real estate practitioners that have been using video to market their properties for several years now. There are about to be a whole lot more. Trainers and industry experts are pushing video hard in 2009. Startup companies and ones that have been around a while from Vimeo, Vidller, and Veoh, to Wellcomemat, Animoto, and Youtube, are primed for the explosion of real estate web video. Get ready for amateur and professionally produced property, neighborhood, and city tours.
Social Media continues it's growth.
More users are going to start working smarter, not harder on social networks. Watch for innovators to combine social networks so that users can interact across sites and platforms. There will be a select few that use it, get it, and succeed. Many of the rest and the late adopters will simply be wasting their time. Sign up to get new listings from your agent through Twitter. Interact with agents and homeowners on linkedin, real estate voices, trulia answers, and local forums and blogs along with a bunch of others.
The static real estate site is dead or dying.
Real estate is local and happening right now. Static sites can't compete with Bloggers keeping clients, readers, and prospects up-to-date on a daily basis. More plugins, widgets, and designers for blogging have allowed the Wordpress Blogsite to become just as useful as an old static site and beat them in the search engines in the process. Learn to use RSS feeds to stay current and keep your inbox uncluttered. Get to local blogs to get the real scoop from local agents on the ground. In Northwest Arkansas, look for big things from EXITprorealty.net towards the end of the first quarter of ‘09.
Buyer and Seller Mindsets
Sellers are going to get educated in 2009 and make smart decisions to get their homes sold. There is still going to be a lot of fear pumped in by the media and housing indicators but sellers are starting to learn that real estate is local and not all areas are as bad as the large metropolitan areas. Watch for sellers to start expecting upgraded home listings through the use of single property websites, web video home tours, and listings leveraged by social media and networking.
Buyers are going to get a clue that this market isn't going to last forever and go ahead and buy a home. I think buyers are waiting in the wood works for a few reasons: Credit and lending issues, fear about the state of the market and hoping to time the bottom to get the best price, and trouble selling their current homes. It's called a self-fulfilling prophesy. Education by the real estate community is the key to stopping this wait-it-out mentality. Look for more local ‘town hall' style meetings and Realtors taking awareness out into their community and online.
There is so much more to talk about when it comes to current and future real estate trends from green building and alternative energy to commercial real estate trends. Check back often for updates on this topic and emerging trends and news.
What's your take on the state of real estate? I'd love to hear your viewpoint about what 2009 holds in store for all of us. Realtors, home owners, first time buyers, title officers, mortgage and banking professionals - what do you see on the horizon for 2009 in your neighborhood/city/industry?