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Making the Next Play: With Instant Offers, Zillow to Begin Buying and Selling

Apr 15, 2018 by

Zillow announced on Thursday it is becoming a buyer and seller through its Instant Offers platform, beginning in Las Vegas and Phoenix with Premier Agents this spring. Arik Prawer, formerly chief integration officer at Invitation Homes, has been appointed chief business development officer to oversee the participation of Zillow on the platform.

On Instant Offers, Zillow is going to be represented by a Premier agent in the area, and make improvements to properties, if needed, to swiftly turn around transactions. Zillow has chosen to enlist help in the process—a distinction from Opendoor and Offerpad—to “enable agents to earn commissions,” according to the announcement from the company.

In a CNBC interview on Friday, CEO Spencer Rascoff discussed the motivation to participate, noting he expects to have held between 300 and 1,000 homes for sale by year-end.

“We’re ready to be investors in our own marketplace, because what we know is that home sellers welcome a hassle-free experience,” explained Rascoff. “We think we have huge advantages because we have access to this huge audience of sellers [and] huge audience of buyers…that’s why we’re doing this.

“We’ve done this a very industry-friendly way, and that’s why the reaction so far in the industry has been welcoming,” Rascoff said.

WHITE PAPER: The Disruption of the Real Estate Industry: A Survival Guide for Brokers and Agents

Instant Offers was introduced in May 2017 in Las Vegas and Orlando; with the announcement on Thursday, it has expanded to Phoenix. For its foray into Las Vegas and Phoenix, Zillow has partnered with Berkshire Hathaway HomeServices Arizona and Nevada Properties, Coldwell Banker Premier Realty and West USA Realty.

“Even in today’s hot market, many sellers are stressed and searching for a more seamless way to sell their homes,” said Jeremy Wacksman, chief marketing officer at Zillow, in a statement. “They want help, and while most prefer to sell their home on the open market with an agent, some value convenience and time over price. This expansion of Instant Offers, and Zillow’s entrance into the marketplace, will help us better serve both types of consumers, as well as provide an opportunity for Premier Agents to connect with sellers.

“This is expected to be a vibrant line of business for us and for our partners in the real estate industry, while providing homeowners with more choices and information,” Wacksman said.

“We are tremendously honored to have been selected by Zillow as a primary partner in their expanded Instant Offers program,” said Robert Hamrick, chairman and CEO of Coldwell Banker Premier Realty, in a statement. “Coldwell Banker Premier Realty has a decades-long legacy of combining high-touch client engagement with high-tech innovations for fully-serviced home-selling and -buying experiences. Our agents are competing with investor buyers. As Zillow’s partner in the Instant Offers program, we are able to stay in front of changing consumer demands and provide clients an additional option when selling their home. Our brokerage is passionate about empowering our agents to best meet their clients’ needs. We are excited to be a part of Zillow’s program.”

With Instant Offers, homeowners enter information about their property, and, within two business days, get investor offers and a comparative market analysis (CMA) by a Premier Agent. For agents, the benefit is that they can earn listings of presumably ready-to-act sellers.

Eighty-seven percent of agents and brokers in a June 2017 RISMedia survey believed Instant Offers is “a shift by Zillow toward becoming a brokerage.”

“We have always felt, and will continue to maintain, that agents are a crucial part of the real estate transaction and our goal is to find ways to continue to integrate them in the transaction process, even as the process continues to grow and evolve,” said Zillow in a statement to RISMedia at the time.

Stay tuned to RISMedia for more developments.

DeVita_Suzanne_60x60Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

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Economic Gains Spark Confidence in Buying, Selling

Mar 15, 2017 by

Economic gains have sparked confidence in home-buying and -selling, with 80 percent of those surveyed in the National Association of REALTORS® (NAR) Housing Opportunities and Market Experience (HOME) survey believing now is a good time to buy and 69 percent believing now is a good time to sell—an outlook carried over from optimism about the broader economy. A record 62 percent of those surveyed believe the economy is improving, with respondents in the Midwest exuding the most positivity.

“Confidence levels generally rise after a presidential election as the nation hopes for the best,” says Lawrence Yun, chief economist at NAR. “Even though it is a highly polarized country, consumers for the most part have upbeat feelings about the economy right now. Stronger business and consumer morale typically lead to even more hiring and spending, which in turn encourages more households to make big decisions like buying a home. These positive developments would be especially good news for prospective homebuyers in the more affordable Midwest region.”

Over 62 percent of those surveyed—also a record—believe their financial situation will improve in the next six months.

The trend, however, is being tamped down by renters. Fifty-six percent of those surveyed believe now is a good time to buy—a steadily declining share.

“Inventory conditions are even worse than a year ago, and home prices and mortgage rates are on an uphill climb,” Yun says. “These factors are giving many renter households a pause about it being a good time to buy, even as their job prospects improve and wages grow. Unless there’s a significant boost in supply levels this spring, these constraints will unfortunately slow or delay some prospective buyers’ pursuit of purchasing a home.”

“Demand far outpaces supply in many parts of the country right now, which means homeowners will likely sell their home much quicker than the time it takes to buy another,” says NAR President Bill Brown. “Before listing, it’s best to have a carefully crafted plan in place. In addition to assisting in the hunt for a new home, a REALTOR® is an invaluable negotiating partner in the common situation where a buyer’s new home purchase is contingent upon selling their property currently up for sale.”

For more information, please visit www.nar.realtor.

For the latest real estate news and trends, bookmark RISMedia.com.

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Buying Is Better Than Renting in Most Markets…but for How Long?

Jan 7, 2017 by

Buying a home is more affordable than renting one in 66 percent of housing markets in the U.S., with Cook County, Ill., Maricopa County, Ariz. and Miami-Dade County, Fla. among those with the highest buy affordability, according to ATTOM Data Solutions’ 2017 Rental Affordability Report. Renting a home, to compare, is more affordable than buying one in 34 percent of markets, with Dallas County, Texas, Kings County, N.Y. and Santa Clara County, Calif. among those with the highest rent affordability.

Predominantly impacting affordability are stagnant wages, which have lagged at a growth rate of 2.2 percent since one year ago, compared to home prices, up 5.7 percent, and rents, up 4.2 percent.

Rising mortgage rates, according to ATTOM Senior Vice President Daren Blomquist, could deal another blow to affordability. Average rates, which retreated since charging forward following the election, are currently above 4 percent.

“While buying continues to be more affordable than renting in the majority of U.S. markets, that equation could change quickly if mortgage rates keep rising in 2017,” says Blomquist. “In that scenario, renters who have not yet made the leap to homeownership will find it even more difficult to make that leap this year. Additionally, renting may end up being the lesser of two housing affordability evils in a growing number of high-priced markets.”

Home price growth outpaced wage growth in 79 percent of the counties analyzed in the report, while rent growth outpaced wage growth in 62 percent. Both percentages include Harris County, Texas, and Los Angeles County and San Diego County, Calif. Wage growth, however, outpaced home price growth in 21 percent of the counties analyzed, and outpaced rent growth in 38 percent.

A monthly house payment on a median-priced home will require 36.6 percent of average wages, according to the report; a monthly fair market rent will require 38.6 percent.

The most affordable rental markets in 2017, based on the percentage of average wages needed to pay fair market rent, are:

  1. Madison County, Ala. (23.9 percent)
  2. Allegheny County, Pa. (24.4 percent)
  3. Fulton County, Ga. (24.8 percent)
  4. Anderson County, Tenn. (25.1 percent)
  5. Rock Island County, Ill. (25.3 percent)

The least affordable rental markets in 2017:

  1. Marin County, Calif. (77.3 percent)
  2. Spotsylvania County, Va. (73.7 percent)
  3. Monroe County, Fla. (72.2 percent)
  4. Honolulu County, Hawaii (70.7 percent)
  5. Maui County, Hawaii (70.6 percent)

Source: ATTOM Data Solutions

For the latest real estate news and trends, bookmark RISMedia.com.

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How Single Women Are Changing the Home Buying Market

May 25, 2016 by

While women in business schools and C-level suites may still hover on the low end when compared to their male counterparts, single women are currently proving to be one of the most important demographics in the home-buying market.

The National Association of REALTORS® (NAR) reported this year that — of the recent buyers who are single — single women accounted for 60 percent more home purchases than single men, across all age groups. They are actually the biggest home buying demographic after married couples.

This trend of single female home ownership is projected to increase in the coming years, thanks to a variety of factors. The gender-pay gap is decreasing, giving women increased financial independence. In some areas, their incomes are even increasing faster than their male counterparts’ are.

Generational Gap: Baby Boomers (Still) Own the Housing Market

Even though millennials show great promise in the real estate market, baby boomers are still the largest group of homebuyers. NAR found that single female baby boomers buy twice as many homes as single men do and account for one out of every five houses sold in their own age cohort.

Additionally, baby boomers are wealthier than any other generation. They are set to inherit $ 13 trillion of wealth in the next 20 years, and 70 percent of them believe that their current home will not be the best one that they live in. Contrary to cat lady stereotypes, a 2015 survey of over 1,000 single boomer females found that the overwhelming majority — 74 percent — are as confident and happy as they were at 35. These women are going to keep buying houses. Better, bigger houses, at that.

This trend affects the housing market as well as the interior design business. A company that targets single female baby boomers would be wise to consider their preferences. Boomers overwhelmingly live in the suburbs and have more space than other generations who camp out in smaller city apartments. Custom hardwood cabinetry, granite or marble countertops, and the ability to customize are all attractive options for single female baby boomers. This slice of consumer will not shy away from affordable luxury, like a glass-gated walk-in shower or custom bathtub.

Per Richard Endres, the owner of E.B. Endres, a residential home remodeling company, “Statistics show the number of single women homeowners is on the rise.  We have a number of single women homeowner clients so we are experiencing the statistic first-hand within our residential remodeling division.  There are subtle and pronounced differences in how women approach a remodeling project as opposed to men.”

According to Endres, when his company meets with a female client to start a remodeling project:

  • She knows her budget and she’s determined to stay within that budget.
  • She wants to reflect her personality and her own personal style through the project. Fortunately there are many design styles and options today to choose from.
  • She takes time to do her research and make final decisions.
  • She wants the best quality products and workmanship she can afford within her budget.
  • She is concerned for others. She focuses on comfort for herself as well as family and friends who will benefit from the remodeling project.

It’s clear from this industry insight that single women, regardless of age, are coming into their own in the housing market.

Millennial Focus: Young Adults Will Enter the Market

Millennials tend to live in smaller spaces located within major cities, close to their workplaces and social centers. Also, millennial women tend to get married later (if they plan to marry at all) and are well-educated. Their demand for housing will likely increase along with their salaries. It’s no secret that the U.S. marriage rate has hit record lows in recent years, which makes singles an even more important player in markets like housing, traditionally dominated by married couples.

Millennials also want to differentiate themselves from their parents — McMansion-style designs will not sell well within this age group. They tend to favor unique, stylish, but practical designs. This could mean an in-kitchen cocktail/bar space for entertaining complete with mason-jar cocktail mugs, or a shower with a top-mounted rainfall showerhead that adds a bit of comfort and class to a small space.

Location will be particularly important for this cohort. On the upper end of this market, a preference for apartments or condos in dense communities with vibrant street life is expected. Dense cities like San Francisco or Pittsburgh are currently enjoying downtown booms, with ever-increasing numbers of high-earning women moving in every year.

Future Plans: Housing Options Marketed Across Age Groups

As the housing market continues to change, it’ll be more important to market towards women across all age groups, not just millennials. No generation is homogeneous, and marketing that way is a recipe for failure. A variety of choices and designs targeted towards all women, and features like easy parking, safety and overall affordability, will have obvious appeal for all single females.

Single women are getting a lot of attention in the real estate industry — and for good reason. This group is clearly on the upswing both financially and demographically. The current U.S. economy favors the growth of home buying, despite rising prices in certain areas. Lenders are making it easier and easier to get a mortgage after tightening the screws during the financial crisis. Many are saying that the time to buy a home is now, since property prices in the U.S. overall are expected to increase in value following the housing bust.

All in all, in an increasingly fragmented market, single women are the most important demographic to watch out for. They are increasing in power, wealth and market share, and are a force to be reckoned with.

This post was originally published on RISMedia’s blog, Housecall. Check the blog daily for top real estate tips and trends.

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First Look: Home Buying Season Is Already Booming

Apr 30, 2016 by

The 2016 home-buying season is in full swing, with homes in April moving 7 percent faster than one year ago, even as asking prices continue to break records. This, according to new data released this week by realtor.com®. Median age of inventory is now 68 days, moving 5 days faster in April than a year […]
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