Looking for a way to set apart your property marketing?  Try adding floor plans!

A few months ago I discovered MetroPix, where you can design floor plans using their FREE online service.  You can pay a bit more for floor plans with color, or in three-dimensions, or with photos, etc., etc.  Thus far, I have only utilized their free service — and then added some color afterwards.

Do you know of other free floor plan drawing tools?  Let me know!

Last week, five Realtor bloggers from Virginia, Scott Brunner (VAR CEO), and Ben Martin (VAR Director of Communications & New Media) met with Dr. Lawrence Yun, the chief economist for the National Association of Realtors. We had a fantastic opportunity to speak with Dr. Yun about the current housing market, market trends across the country, how NAR makes home sales forecasts, and much more. Dr. Yun was able to provide very candid comments on a lot of issues and questions that many Realtors have about our current market. A few observations about Dr. Yun, who I consider to be one of the great assets of the National Association of Realtors . . .

Driven By Vision

When Dr. Yun took on the leading economist role for NAR, he recognized that it was an opportunity to make the National Association of Realtors the number one source for information about and analysis of the housing sector, as it relates to the larger U.S. economy. He then filled some of the open positions in his research division, and has compiled a team of economists that together provide the multitude of studies and and research papers that can be a great resource for Realtors on the ground.

Fiercely Independent

To accomplish the vision above, Dr. Yun recognized the need for independence in his economic research and analysis, and he has been given the space to do so, and taken the prerogative to do so. Dr. Yun does not pass his economic assessments or outlooks by a panel of NAR leaders to get approval of his analysis. The information and commentary he provides is simply based on the data. Additionally, he doesn’t become preoccupied with what other well known economists might be saying about the housing market or the economy at large. Dr. Yun and his staff of 10 economists look at the data from the housing sector, and all other related economic indicators, and puts forth the forecasts, analysis and commentary as they see it.

Perceptive and Insightful

Dr. Yun loves the opportunity to meet with and talk to Realtors from around the country, as he is at different conferences making presentations, and otherwise. While he can’t necessarily accommodate for all of qualitative data he gathers from these conversations, it definitely helps him to have some additional data points as he analysis the amazing amounts of quantitative data that he works with on a daily basis. The questions he had for us drove this point home even further, as he inquired about market conditions and trends that we have been seeing of late in our respective areas of Virginia. For example, he has spoken with many Realtors lately in the DC area who have started to see an increase in open house activity and showings.

For more insight on Dr. Yun, check out the the following posts:

• Dr. Lawrence Yun - Unplugged (Danilo @ real/diaBlog)
• “Without Forecasts, We Don’t Look Credible” (Jim @ realcentralva.com)
• Dr. Lawrence Yun Is A Zebra (Daniel @ realestatezebra.com)
• No Pandering, Promises or Pretense… The Real Lawrence Yun (Matt Rathbun @ agentgenius.com)

When I started blogging five months ago, I did so in hopes of:

1. creating an opportunity to more fully engage with my current and past clients,
2. creating an open platform for commentary and discussion of our local real estate market, and
3. becoming a trusted adviser on all things real estate in the Central Shenandoah Valley.

As a result of pursing the goals above, I hoped that in the long-term (perhaps after a year or so) I would see:

1. an increase in traffic to my web site
2. an increased sphere of influence
3. an increase in sales

Focusing, for a moment, solely on the web site traffic — here’s what I’m finding after just five months . . .

You’ll see that I had experienced relatively unchanged levels of traffic to my web site for seven straight months — until I began blogging. Furthermore, the increased traffic since I started blogging has been astonishing — certainly beyond my expectations.

A few disclaimers, explanations and miscellaneous thoughts:

• I have a combined web site and blog — and the traffic trend line above is for the traffic to that combined site. Interestingly, the traffic increases have existed not solely in the blog section of my web site, but in the searching section (and others) as well.
• When I began last November, there weren’t any other Realtors in my marketplace blogging. There are several more now, but I imagine being the first one out the gate may have contributed to my growth.
• I have learn a lot from fellow Realtor bloggers around Virginia and beyond about how to promote my blog — commenting on other local blogs, highlighting it in offline printed marketing materials, etc.
• In addition to increased traffic, I have certainly seen an increase in my sphere of influence — I have established many new relationships with people in my local market area.
• I have not yet seen an increase in sales as a result of my blogging activity — but given all the increases in traffic and the increase in my sphere of influence, I imagine that will happen in the coming months or year.

Are you thinking about starting a blog? While I’m certainly not yet an expert on blogging, you are welcome to contact me — I’d be happy to share some of what has worked well and not worked so well for me over the past five months.

Perhaps Jonathan Clements, a personal finance columnist at The Wall Street Journal, is also a chess grandmaster!? In a recent NPR interview, he spoke of a possible real estate stalemate . . .

In the interview, Jonathan ponders “…are we going to see prices drop, which will encourage buyers to step up to the plate and purchase, or are we going to continue with the standoff, where sellers are reluctant to cut prices and buyers are reluctant to commit?” He then makes some other great observations about selling in today’s market:

• Some sellers look at pricing psychologically — they want to sell their home for what they paid for it plus improvements, or at the price the neighbors sold their house, etc.
• Real estate is an expensive asset to hold, given mortgage principal, interest, taxes, insurance, maintenance, etc.

The interview (here) is brief, but offers some interesting perspectives on selling in today’s market, as well as on the strange standoff in which buyers and sellers are currently engaged.

Three reasonable facts . . .

1. These days (and perhaps always) consumer confidence plays a large role in the state of the housing market. Many buyers and sellers are fearful that home values are dropping precipitously, or will be soon.
2. Consumer confidence, in many ways, is shaped by the mainstream media — as this is where many Americas get information about the housing market.
3. One of the highly regarded sources of information on the housing market is the Case-Shiller Index, which tracks 20 major markets.

. . . that may be having unreasonable effects . . .

• The markets featured by the Case-Shiller index tend to be in California, Florida and other down markets. This makes the index show price declines, which the media highlight, which scares consumers. As Lawrence Yun states, “This is total distortion of market conditions based on a small selection of falling local metro coverage.”
• A second source of information on the housing market, the Office of Federal Housing Enterprise Oversight (OFHEO), shows 70% of 287 local markets having price increases. Again from Yun, “the OFHEO survey gets far less coverage than the Case-Shiller index. Perhaps the media is intent on looking for sensationalized headlines. After all, the media is in the business of selling news, and more sales can be made with sensationalism. (I have been told by few reporters off-the-record that they are interested in increasing their viewership even if it means putting things out of context.) “
• And perhaps the most unreasonable of all, “Another factor that rarely gets attention is that Dr. Shiller, a Yale professor, has a side business in Chicago. His index is used at the Chicago Mercantile Exchange for hedging housing futures values. The more hedging of bets that occur, the more profits go into Dr. Shiller’s bank account. And more hedging of the bets will take place if people believe there will be a crash in housing values. So naturally he has a financial incentive to “scare” the market.”

The entire article from Lawrence Yun is definitely worth reading — and it is great to see NAR bringing these facts to light.

H/T - Jim Duncan, RealCentralVA.com

A few months ago, most lenders in our area stopped offering “80/20″ loans — and last week, VHDA suspended their 100% loan programs!

I have always sent first-time buyers to lenders that offer VHDA financing programs. These programs offer below-market rates for first time home buyers, with flexible financing up to 103%. However — as of April 1, 2008, these 100% loan programs will be suspended (i.e. not available) until further notice.

The explanation, in an e-mail from Michele Watson (Director of Homeownership Programs, VHDA) was that it is “…an effort to best utilize our resources, maintain adequate long term funding for our loan programs and to mitigate the risk to our borrowers and VHDA…”

There are still some 100% options, but as the number of programs dwindle, it will become increasingly harder to finance a home purchase, especially for first-time buyers. Some remaining options include:

* VHDA/FHA 103% loan program (via any VHDA lender)
* Fannie Mae 100% program (via most lenders)

So . . . if a Virginia buyer needs a 100% loan, and isn’t committing to it on or before March 31, 2008 — prepare for fewer options, with less favorable rates.

At today’s MLS Forum, Michael Wurzer, of FBS (FlexML) characterizes the future of MLS as a “Perfect Storm” — with three storm fronts that are potentially shaping this future: Broker Consolidation, Web 2.0, and NAR vs DOJ.

(1) Broker Consolidation: Brokers are growing and consolidating, which is causing MLS’s to grow. Some MLS’s are consolidating, some are sharing data.

(2) Web 2.0: Key components of this movement include:

• universal accessibility of information
• open access to technology
• consumer choice and particpation
• independence, freedom and respect

Some companies that are involved (in varying degrees) in the Web 2.0 world are zillow, redfin, craigslist, google, point2, trulia, yahoo, and roost.

(3) NAR vs. DOJ: The basic accusation is that NAR is anti-consumer. Since NAR is Realtors, the syllogism is that Realtors are anti-consumer (fees are too high). Lawsuits create a status quo — no changes are made to make sure that the lawsuit isn’t complicated. This vacuum of innovation is being filled by many of Web 2.0 companies.

Is It Too Late?

Will the web run over the MLS? According to Michael, no. We define the web . . . and yet, at the same time, the web defines us. So . . . as Michael says, “The Future Is Now. ” We are defining our future today, by our decisions and actions — and the foundations are just being built. Some of the current trends include . . .

• Standards: Standards are being defined (in real estate and other areas) to provide broad and deep definitions. The Real Estate Transaction Standard (RETS) is defining a listing in these ways, to allow for data portability. Data portability provides power and choice.
• Syndication: Entering the data (listings) into one location, which then sends out out to many different web sites. RETS has created a syndication work group to try to standardize syndication. This standard will ideally be used by MLS vendors

Thinking Points . . .

Licensing Our Syndicated Data

What happens to the real estate content we provide to third parties via syndication? From Google’s terms of use, when content is submitted to Google, the submitting party is granting Google a “…worldwide, non-exclusive, royalty-free license to reproduce, modify, adapt, publish, and otherwise use, with or without attribution such Content on Google services.” However, it goes on to state that the “…license terminates when such Content is deleted from the Google service to which you originally submitted.” We need to consider developing standard ways to license our data. (ex. Creative Commons) Standards are just now being developed for all that matters. We have the opportunity to participate in that process.

MLS is More Than Technology

The MLS is essentially a social network, with (strangely), competitors cooperating. It is, to some extent, a representative democracy. This cooperation allows an aggregation of data. Without this cooperation, listings will not all be in one place. Thus, the question (again) is who is serving consumers? The aggregation of listings (via the MLS) is a service to consumers.

Moving Forward

• IDX is a fantastic tool, but it lacks the standardization and full features necessary for moving forward. Perhaps IDX needs to be revisited, within the Web 2.0 context.
• How should we cooperate on the web?
• Which parts of the listing we want to share?
• Are listings are advertising, or information?
• Who are the members of the MLS?
• Should the consumer be a “member” of the MLS? What if they agreed to our terms of use?

As leaders in the industry, we need to determine whether these trends, questions and ideas are just noise, or whether they are an indication of a major industry change on the horizon. The future is being formed right now . . . the question is who will determine this future.
—

Some of Michael’s recommended readings:

• Only The Paranoid Survive
• Cluetrain Manifesto
• Code 2.0
• The Summer of 1787

Looking for more insights from Michael Wurzer? Check out his blog: http://www.flexmls.com/blog.

Today’s “Issues Forum for Local Leaders” addressed the timely issues of recession possibilities, economic stimulus implications, sub-prime lending, declining markets, housing demand, and more.

Some interesting insights from the panelists included . . .

• Regardless of whether we are “in a recession” or not, finances will be tight for many consumers in the coming years.
• A $600-$1,200 check from the government isn’t going to turn someone into a buyer.
• Loan limits are restrictive in some markets (often 125% of median sales price).
• Some loan programs are disappearing, as large lenders are having a hard time re-selling mortgages.
• It is becoming increasingly difficult to obtain a loan, especially for first-time buyers.
• Two-thirds of sub-prime lending in Virginia was cash-out refinances.
• In the northern region of the state, 25% of listings are REO properties.
• Virginia as a whole has a lower foreclosure rate than the nation as a whole.
• Prince William, Loudon and Fairfax County are some of the hardest hit areas of Virginia with foreclosures.
• Inventory is very high in many areas. MRIS has around 100,000 active listings — their historical average has been 50,000-60,000 listings.

The resounding consensus was that ALL REAL ESTATE IS LOCAL — each area around Virginia is experiencing these challenges to varying degrees.

One very interesting question was in regards to whether there is pent up demand. Lisa Fowler pointed out that there is likely “theoretical pent up demand,” but it may never translate into actual demand. A large part of this is affordable housing — there are consumers who want to buy, but they may not be able to do so. Current demand is significantly reduced compared to 2004/2005, because speculators have largely left the market, and increases in home prices have priced some buyers out of the market.

Panelists and facilitators included:

• Jonathan Hill, Vice President of Business Strategies, MRIS
• Lisa Fowler, Director, Office of Housing Policy Research, George Mason University School of Public Policy
• Jim Napier, President, Napier Realtors ERA, Midlothian
• Sandee W. Ferebee, CRB, GRI, GSH Real Estate, Virginia Beach
• John Dickinson, VAR Treasurer, Roanoke
• Barry Merchant, Sr. Policy Analyst, VHDA

The Virginia Association of Realtors released the 2007 Year-End Market Report today, which puts year end market data into context. Along with providing insight and analysis into the many local, state and national issues that affected this Virginia’s real estate market this year, the report also points out that market conditions vary considerably in different areas of the state. Below is a graph showing the percentage change in the number of homes sold in each area of Virginia.

Of the 23 local markets for which data was available, only two markets showed an increase in number of homes sold, and 21 showed a decline. Overall, the state of Virginia showed an 18.46% decrease in homes sold, but there were quite a few outliers:

• Dulles Area (+ 9.61%)
• Southwest Virginia (+ 1.44%)
• Eastern Shore (- 46.68%)
• Prince William (-30.46%)
• Northern Neck (- 29.74%)

However, despite the decrease in number of real estate transfers this past year, sales prices managed to stay relatively flat. Median Prices were up 1.2 percent in 2007, and average prices were down 3.1 percent.

Overall, the report is hopeful . . .

• “Virginia faces stronger market fundamentals than many other states, with a relatively strong economy and a housing market with a relatively small share of investors.”
• “We expect that markets in Virginia that have strong job growth and low unemployment rates—which includes most of the metropolitan areas throughout the state—will see increases in the demand for housing in 2008 and prices will begin to rise.”

In April, we can look forward to more great analysis and insights, as the 2007 Year-End Market Report was prepared by the George Mason University School of Public Policy, whose staff will be continuing to provide these reports for each quarter of 2008.