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Midwest Real Estate Data leaders cautiously optimistic about 2012

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Exercising caution

Forecasting and predictions from the National Association of Realtors for 2012, predicting a very small rate of improvement for the year, especially regarding home prices and sales as they are so intertwined with the health of employment levels in America.

A new report from the Midwest Real Estate Data’s Board of Managers forecasts similarly, putting forward a cautiously optimistic face, noting that most of the board believe the market may have hit bottom and that this year could mark improvement in housing.

Tom Guttilla, Owner of Coldwell Banker Today’s Realtors, sees the real estate market improving at a slow but steady pace. “Rates will stay at historic lows and sales volume is improving but is still at lower levels,” said Guttilla. “This, combined with the pent up demand from the last few years, should ensure future sales increases and improving values, but the latter only after inventories are diminished.”

Guttilla recommends agents aggressively market their listings, using technology to best do so affordably. “After the last four years, 2012 will be like a breath of fresh air,” added Guttilla.

Jim Haisler, Chief Executive Officer of the McHenry County Association of Realtors®, sees the outlook for real estate in 2012 as still struggling but improving. “I think signs are showing improvement but the foreclosures will continue throughout the year, even at a slower pace, which will keep prices low,” said Haisler. “Interest rates may become a factor as the economy improves, however.”

Haisler recommends that real estate professionals stay focused on their businesses and education, especially staying current on market trends and changes with lenders. “2012 will be a good year,” added Haisler, “but I think the longer term outlook is even better for the next three to five years.”

Anthony Trotto, Attorney and Managing Broker of Anthony J. Trotto Real Estate, believes there are opportunities despite continuing high levels of REO inventory. “The rental market is strong,” said Trotto. “Now is the time for buyers to really look at picking up some rental investment properties.”

Trotto recommends that real estate professionals educate themselves about the finance and mortgage industry and accept that we are not going back to the great years we experienced from 2001 – 2006. “For those who continue to operate under the premise the housing boom is coming back and home prices are going to sky-rocket again, this year will not be good at all,” added Trotto. “But for those who adapt and learn about where we came from so we don’t go there again, the year should at least be fulfilling.”

“Guarded optimism”

“We share a guarded optimism about real estate in general and our local markets in particular,” Russ Bergeron, Chief Executive Officer of Midwest Real Estate Data (MRED), the Chicagoland MLS told AGBeat. “We are seeing signs of an economy and real estate industry that are turning the corner. Looking at the overall numbers for our entire market shows a slight (+3%) increase in the number of sales in 2011, and a small decrease (-5%) in dollar volume sold when compared to 2010. The last 6 months of the year were even better – with each month showing a 13-26% increase in the number of sales, with 5 of the last 6 months showing a dollar volume increase of 5-16%.”

Bergeron added, “We are still faced with the drag of distressed properties. For example the average sale prices for traditional, short sale, and foreclosure sales respectively in 2011 were $274,000, $155,000, and $97,000. Of course these are generalities and each local market will differ. One interesting phenomenon that has occurred is within the rental market. One, as resale markets have dried up and lending has tightened up, the rental market has surged. Two, the interesting angle on this is that as the number of rentals has decreased, rent has been increasing which has resulted in the rent/buy decision approaching a stalemate because of the similarity in relative affordability.”

Concluding, Bergeron noted, “We will all need to prepare to prosper in the ‘new normal’ market. There is no going back to the boom years of the last decade.”

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

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23 Comments

23 Comments

  1. New York Apartments

    April 13, 2012 at 3:02 pm

    I am extremely encouraged by articles such as this, but am also realistic… what’s going to happen when the bank owned properties begin to flood the market, as interest rates begin to rise.

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Austin

Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?

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Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.

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aging housing inventory

The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

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Housing News

Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.

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zillow move

Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

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