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CBS NOT NECESSARILY THE NEWS
Date: May. 17, 2007
CBS News Magazine Show Misses the Mark Tags: None May 14, 2007 -- In the world of political campaigns, it's a standard ploy to set the stage with an empty chair when one candidate refuses to debate his opponents. The CBS show 60 Minutes gave the NATIONAL ASSOCIATION OF REALTORS® the empty chair treatment in a May 13 segment that examined the impact of online brokerages on the real estate industry. The show featured interviews with a representative from the now-defunct eRealty and the president and CEO of Redfin, but no one from NAR, even though NAR twice offered and prepared Association spokespersons for interviews with Leslie Stahl. It was CBS that made the decision it would rather interview our opponents and let them make unanswered -- and inaccurate and unfair -- accusations about REALTORS® and NAR policies. The one-sided journalism and egregious errors served no one well, especially the once-vaunted news magazine show. NAR staff spent nearly a year working with CBS, briefing producers on the issues involved. The producers attended the REALTORS® Conference in New Orleans and met with NAR's legal counsel for half a day in Chicago. Yet, still the segment was full of major errors. NAR is in communication with 60 Minutes about its unbalanced reporting and presentation of misinformation and will be sending the CBS network a letter demanding an opportunity to correct these errors and misrepresentations. Here are some examples of the misinformation: Error: The six percent commission is "sacrosanct." Fact: All commissions are negotiable. The average commission rate is not 6 percent, but 5.1 percent, according to Real Trends. Error: NAR is the industry's "governing body." Fact: NAR is a trade association. It does not govern the industry. Error: In 2003, NAR issued new rules of its own that threatened to block Internet discounters' access to the MLS. Fact: The Virtual Office Website policy did not block access to MLSs for discounters or any other brokers who are members of the MLS. Error: The MLS is the database that lists virtually every home for sale in the country. Fact: There is no single national MLS. Rather, there are more than 900 local and regional multiple listing services. These are not simply "databases" but private exchange of offers of cooperation and compensation between real estate brokers. Error: Eight states have "minimum service laws" that require REALTORS® to provide a level of service many Internet discounters can't afford. Fact: "REALTOR®" is a trademarked term and should never be used synonymously with "real estate agent." The intent of minimum service laws is to ensure consumers receive a minimal level of service from licensees. Error: The brokerage industry has a powerful lobby. Eleven states flatly prohibit rebates. Fact: The intent of anti-rebate laws is to prevent kickbacks in real estate transactions, not to limit brokers' incentives to attract customers. The brokerage industry does not lobby for anti-rebate laws. Other key points 60 Minutes misrepresented or overlooked: | |||||
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If you have a GMAIL account or are a ready of Business Week, you might have found an article about subsidies.
The article talks about subsidies and how they play a role in moving real estate. It gives the impression that there may be a false ceiling (or bottom depending on how you look at it). It does not speak directly about numbers or what is being offerred. Furthermore, it almost suggest that Realtors are the ones pushing this movement.
I can only speak about my experience here in Atlanta, but a typical offer will look like this:
Asking Price: $200,000
Agreed Price $198,000
Seller Pays $4000 in closing
Seller leaves refrigerator or pays $1,000 decorating allowance.
For the purpose of the article, I would consider $1,000 to be a subsidy. Lenders are getting very tough on this sort of thing. Heaven forbid you find a home that needs a lot of work, decorating allowances are all but gone.
Each state has a differing view on Closing Costs. It seems like this article mistakes the seller paid closing costs (the norm in Atlanta) for a subsidy. Its been my experience in states like New York, they will negotiate the price and tack on closing costs if needed, whereas in Georgia, we negotiate with them as an option included already.
As for Realtor practices skewing data, it would only take a surveyor to find out this is false as well. Ask any Realtor what the standard discount on a home is and they likely have an average for the area.
The article is interesting because it's writer is obviously someone who doesn't understand that Real Estate is a market like the stock, commodity or currency market. Prices go up and down, each market has commissions, incentives and a variety of purchasing options.
Ooops, I think I rambled too much.
By Rex Nutting
RISMEDIA, May 10, 2007-(MarketWatch)-Stricter lending standards are likely to further erode housing markets this year and next, the National Association of Realtors said Tuesday in its monthly forecast update.
"If it weren't for a favorable economic backdrop, housing would probably have a hard landing," said Lawrence Yun, senior economist for the NAR. "As it is, we see this as a soft landing with home sales rising gradually in the second half of the year and prices recovering a bit later."
Sales of existing homes will probably fall about 3% this year to 6.29 million from 6.48 million in 2006. Sales of new homes are projected to fall about 18% to 864,000, compared with a 14% drop predicted last month. Housing starts are expected to drop 19% to 1.46 million.
March, April, and May are traditionally the strongest months for home sales. Pleasant weather draws shoppers out of hibernation, and buyers want to get settled by summer so they can take their vacations and be ready for the coming school year. In the Northeast, interested buyers venture out in the wet season to settle fears of leaky roofs and flooded basements.
But this year, the usual throngs of spring buyers just aren't there. On May 1, the National Association of Realtors reported that home sales closed in April will remain soft, with some drag possible into May. The NAR's Pending Home Sales Index, a forward-looking indicator based on contracts signed in March, dropped 10.5% from March, 2006, and 4.9% from February, 2007, to 104.3, the lowest reading since March, 2003.
The prediction for home sales in the coming months was worst in the Northeast region, where the index fell 14% year over year and 4.9% from February's reading. The West showed the most promise, with the index rising 1.6% from February but still falling 8.6% from year-ago levels. NAR does not break out sales by state.
The rate of existing home sales actually increased in February of this year, prompting NAR Chief Economist David Lereah to point to "signs of stabilization" and predict a leveling out of home sales in the months ahead. But in March, existing home sales fell 8.4% year over year, marking the sharpest plunge in 18 years and the beginning of what is sure to be an illuminating spring season.
"March [home sales] weren't anywhere near where they should have been, but April is going to be the month that reveals that things really aren't good," says Pat McPherron, housing economist for Moody's Economy.com. "If April doesn't go well, then that's it. This is the market."
What squashed the spring boom? February's unseasonably cold weather, like January's unseasonably warm weather, jumbled the normal cycle. But despite better weather in March, April still isn't looking up. Even before the NAR announced the March drop in its Pending Home Sales Index, the National Association of Home Builders/Wells Fargo Index measuring builder confidence fell to 33 from 36 in March (a reading below 50 means most respondents view conditions as poor).
Now, most of the blame has fallen on the new stricter lending that has reduced the pool of potential buyers. "Although the weather improved in March, we're starting to see the effects of a decline in subprime lending and tighter lending standards," Lereah says of March's Pending Home Sales Index reading.
But tighter lending standards from companies such as Washington Mutual (WM) and Merrill Lynch's (MER) First Franklin are only part of the problem. "Even if they kept [standards] the same you wouldn't get the same recovery," says McPherron, noting that house prices accelerated faster than incomes during the housing boom. "What [subprime lenders] have done is stopped the bleeding."
The NAR will revise its home sales forecast on May 8 and release existing-home sales for April on May 25. Lereah now predicts that home sales will remain "sluggish" in the second quarter but sees a "modest uptrend" during the second half of the year.
McPherron, on the other hand, says he wouldn't be surprised if home sales were still soft well into the summer months, even though year-over-year comparisons could improve. And if the trend set in March continues, as the numbers suggest, into April, May, and beyond, the many sellers who are struggling to make their mortgage payments and holding out desperately for a spring buying boom could be in for a shock, at least, and foreclosure at worst.
"Many people think, 'if I can just hang on 'til the spring,' they will get an offer," says McPherron. "This spring, they'll be lucky to sell."
Click here to see a roundup of 10 housing markets headed for a decline.
"Written By: Minnie BridgersLast Modified: 5/2/2007 11:14:07 AM
You may have seen those "You Keep the Commission" billboards around metro Atlanta. They are paid for by real estate companies offering a-la-carte services. These so-called "discount agents" have become very popular as the housing market continues to cool.
So the bottom line is, if you want a full course menu of services and someone to wait on you -– hire the commission-based agent. If it is just as peachy for you to do the leg-work yourself and save some green along the way – give the discounter a shot. You can always hire the traditional agent later if you fail to sell your home the new-fashioned way."
The real AHA here should be while opinions can differ on what agents do before the sale, it's the negotiation skill that's worth the big bucks. Bottomline, anyone can make a flier, but an experienced, skilled negotiator is worth their commission.
In light of the constant babble of Real Estate Bubble talk, one person has actually looked at the data. Keep in mind this is NATIONAL data, but it serves it's purpose nonethe less.
The following video gives us a clear picture of what housing prices have done since the late 1800's. Talk about Roller Coaster!
RISMEDIA, May 2, 2007-RE/MAX® Greater Atlanta announces its agreement to acquire RE/MAX Horizons. Their three offices, located in Gainesville, Buford, and Braselton, all reside in Hall County and house approximately 120 RE/MAX® professionals.
"We are extremely delighted to enter one of Georgia's fastest growing counties," said Steve Graham, President and CEO of RE/MAX Greater Atlanta. "[RE/MAX] Horizons agents' dedication to real estate excellent is a perfect fit for our organization and I believe the transition will be quite seamless."
Hall county, with access to the popular Lake Lanier and the foothills of the Blue Ridge Mountains, has seen a near 25% increase in population since the year 2000. RE/MAX Greater Atlanta sold more than 16,700 homes in 2006 equating to nearly $4.4 billion dollars in sales. Honored as the nation's 18th largest real estate brokerage by RISMedia's 2007 Power Broker Report, RE/MAX® Greater Atlanta will comprise 15 offices and more than 1,300 agents once the acquisition is complete.
For more information, visit www.remax-greateratlantaga.com.
Undoubtedly if you have turned on the news in the past year you have heard that we are in a down market. I'm not sure about "THEM" but I for one do not see it. I see a slow down in some rural areas here, but the Atlanta Market has never been hotter.
I recently had a discussion with a client where I explained the Atlanta market to him. He seemed to think we were getting all the people from the other areas. While that is certainly true, I finished up 06 with over $3 Million in agreements with folks to buy homes that weren't able to sell their home where they live. So they at least will not be coming to Atlanta.
So what keeps Atlanta afloat? Great Values, Job Opportunities and a constant rotations of new blood.
Our appreciation rates are relatively low in most areas, but you'll have a difficult time finding an area in decline. Atlanta is like a train, it's just chugging very slowly. You can still find a 3000 SQFT home for $250K in most metro areas.
Job Opportunities abound! New companies pop up every day and long standing companies are always looking for qualified people. The education and patient care fields are booming!
Atlanta is also a hub for training. Walmart, Publix, Home Depot, Bellsouth and more will open stores or use profitable stores as training grounds for their "chosen." They'll ship in the family to Atlanta to train or right a ship and then ship them back out.
Foreclosure rates have also been very high, but this is not new. Many of those buyers, the ones who actually stay, move up to nicer homes. While new home buyers have a vast assortment of affordable housing.
What's not to love about Atlanta, aside from the traffic.
Enrollment in Gwinnett College is through the roof. Up from 118 students, it's now expected to enroll a whopping 3,000 students this year. This puts Gwinnett on the map as a college destination, and should boost rental rates in the area. This is nothing new for Gwinnetians, though. Gwinnett County has always been a great place for students commuting to and from campuses such as Georgia Tech or Georgia State. In addition, many who live in Gwinnett attended the University of Georgia, which is only a 45 Minute ride from Lawrenceville.
Here's the link to the article: Click Here
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