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Real Estate Big Data

Why brokers and agents must understand real estate data standards

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real estate data standards

If you have never thought about how important data standards in the real estate industry are, here are some questions for you:

  • Have you ever been able to list and sell a home while typing the listing address (and other information) less than a dozen times?
  • Have you ever made the transition to a new MLS system only to have to set up all of your prospects all over again?
  • Why can’t you have someone build you a mobile app that leverages all the information in the MLS – listings, clients, saved searches, financial worksheets, etc.?
  • If you belong to more than one MLS, why do you have to enter the listing into each system separately?

Most brokers and agents just assume that the situations described above are just “how things are,” and that there’s no way to make things better. They are wrong. Believe it or not, brokers and agents can play a part in making things better. It all comes back to understanding how real estate data standards work.

Real Estate Data Standards

Data standards define a uniform technical method of moving information between computer systems. In the real estate industry, this standard is called RETS (the Real Estate Transaction Standard) and is managed by an organization called RESO (the Real Estate Standards Organization).

RETS has been under development since 1999. It isn’t even close to “done” because for most of those years no one was managing the process, and RETS development was driven almost entirely by the part-time effort of volunteers such as myself.

It is only in recent years that RESO was formed and professional project management was put in place to manage the volunteer effort. This has radically accelerated RETS standards development; if the industry puts more funding into RESO, it may be possible to hire more staff to make the process go even faster.

The Current State of Real Estate Data Standards

Most real estate systems “speak” a version of RETS that is only capable of moving listing information and MLS subscriber information. This makes it impossible to move some of the information types, such as your prospects’ information, described earlier.

Adding to the problem, there are over 850 MLSs in the U.S. and Canada today, and each has its own unique data fields. For example, Hawaiian MLSs have “lanais.” Moreover, each MLS has unique ways of describing fields that are common to all MLSs. For example, one MLS might have “ListingContractDate”, and others might have ListingDate, DateOfListing, ListDate, ListingContractDate, or AgreementDate. Some MLSs will even have entirely different ways to describe the same thing. Imagine one MLS describing tree coverage as light, medium or heavy wooded, and another describing it in terms of % coverage. There are hundreds of similar examples. All of this makes it challenging for someone who wants to write one program or create one website to use data from multiple MLSs.

While many people in the industry are frustrated that RETS isn’t further along, keep in mind that when it comes to web standards, it took the Web standards organization (the W3C) more than 10 years to release a new version of HTML (version 5). RETS has come a long way in that same timeframe. Still, it’s okay to want RETS to move faster and fulfill its promise, solving the kinds of issues described earlier in this article.

Standards Adoption is Key

Thankfully, RESO volunteers are working to solve the problems described above. The new “data dictionary” provides standardized ways to refer to data covering a wide variety of data types: property (including media and listing history), membership, office, contacts, saved searches and open houses. That’s not every type of data one might want to move from system to system, but it’s getting there.

BUT, while the improved standards have been created, they haven’t been adopted by MLSs and other tech companies.

What Can YOU Do About It?

You can make sure your MLSs and other software providers know that you understand about data standards and you want them to make standards adoption – and integrations based on them – a priority. By telling them so, you can get all the benefits of the rapidly evolving standards.

Some MLSs might say, “We’re dependent on our MLS software vendor to do that for us,” and they are telling the truth there. Nonetheless, the vendors won’t move faster until their MLS customers tell them it’s a priority, and your local MLS won’t do that until its subscribers tell it in turn that standards are a priority. So again, it comes back to you.

Also, if you have a bit of technical skill or even just knowledge of the data, you can get involved with RESO to add your efforts to that of other volunteers’. And, if you have some financial resources, you can join RESO as a member (as I have, putting my money where my mouth is).

For more information about real estate data standards, visit reso.org.

Matt Cohen has been with Clareity Consulting for over 17 years, consulting for many of the real estate industry’s top Associations, MLSs, franchises, large brokerages and technology companies. Many clients look to Matt for help with system selection and negotiation. Technology providers look to Matt for assistance with product planning, software design, quality assurance, usability, and information security assessments. Matt has spoken at many industry events, has been published as an author in Stefan Swanepoel’s “Trends” report and many other publications, and has been honored by Inman News, being listed as one of the 100 Most Influential Real Estate Leaders.

Real Estate Big Data

Home prices jump double digits in majority of American metros [report]

(REAL ESTATE) Housing affordability was already a widespread challenge before current economic pressures were applied, but now home prices are skyrocketing.

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homeownership home prices

As home sales slide and mortgage rates rise, home prices in 70% of 185 measured metros saw a double digit annual increase in Q1, according to the newest data from the National Association of Realtors (NAR), up from 66% in the previous quarter.

The Southern region accounted for 45% of home sales in Q1, and experienced a 20.1% increase in annual home prices (compared to 14.3% just the quarter prior). Home prices in the Midwest jumped 8.5% annually in Q1, while The Northeast rose 6.7%, and the West increased 5.9%.

The median sales price of a single family existing home has now hit an astonishing $368,200.

“Prices throughout the country have surged for the better part of two years, including in the first quarter of 2022,” said NAR Chief Economist, Dr. Lawrence Yun. “Given the extremely low inventory, we’re unlikely to see price declines, but appreciation should slow in the coming months.”

Yun expects supply levels to improve, and for “more pullback in housing demand as mortgage rates take a heavier toll on affordability,” given that “there are no indications that rates will ease anytime soon.”

At first blush, price appreciation sounds lovely to anyone that owns a home, given that it is the largest investment most Americans will ever make.

But regarding today’s report, several homeowners told us that they now feel trapped, and that if they sold their current home, even if they purchased a new house at that same price, they would likely have to downgrade.

Affordability is an ongoing problem weighing down the housing sector. NAR reports that the monthly mortgage payment on a typical existing single-family home with a 20% down payment rose to $1,383 (up $319, or 30%, from one year ago). Families now typically spend 18.7% of their income on mortgage payments (but only spent 14.2% one year ago).

“Declining affordability is always the most problematic to first-time buyers, who have no home to leverage, and it remains challenging for moderate-income potential buyers, as well,” Dr. Yun observed.

Map of how home prices are behaving nationally

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Real Estate Big Data

Office occupancy is on the rise, but its knocking down morale

(BIG DATA) Despite work from home policies still in place and the flexibility some employers are offering, office occupancy is increasing steadily.

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Empty startup office with open floor plan, abandoned while working from home.

As coronavirus numbers dwindle and some officials begin calling for a fourth COVID-19 shot, more and more people previously working at home after being kicked out of shuttered office buildings are returning to the bullpen.

The National Association of Realtors reports that more than 80% of metro areas in the United States have seen an increase in in-person working.

Boston saw the largest office occupancy growth over the past year. Chicago, New York and Washington, D.C. have the most open space.

NAR researcher Scholastica Cororaton says office occupancy is also increasing in areas with a big tech presence. San Jose, San Diego, San Francisco and Seattle lead those areas.

“The rising occupancy in these tech metro areas indicates that tech companies are contributing to the demand for office space,” Cororaton wrote. “Even as nationally, 45% of mathematical and computer workers work from home for at least some part of the time.”

The way companies are returning to work vary and are sparking anger. For instance, Google employees must now be in the office three days a week. On the other hand, Apple begins its return to office plan next week. It starts with employees coming back one day a week which will eventually grow to two days and then three days a week. Apple employees have revolted against the idea and are have threatened to quit.

Many in leadership are pleased with the return to the office to boost productivity and collaboration. However, employees are finding they’re showing up in person to just log in to Zoom again, which has stirred up even more frustration.

On top of the redundancy of work that could be done at home, a study shows only 3% of white-collar employees want to work in the office all week. 86% want to stay home for at least a few days.

Plus, the return to the office drives up costs, with gas prices seeing soaring and inflation at a 40-year-high.

Since the second half of 2021, 30 million square feet of office space has been taken up, however, about 100 million square feet remain.

NAR reports filling that space up again could take through the end of 2024.

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Real Estate Big Data

Why Gen Z is far more open to homeownership than Millennials

(REAL ESTATE) After years of hearing how millennials delay homeownership, it’s refreshing to hear Gen Z has a totally different perspective.

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Woman thinking representing mental toughness.

We’ve written for years about millennials and their reluctance to purchase homes, especially in the wake of the pandemic. Financial hesitancy is a trait long associated with millennials, but according to Hana Ben-Shabat, Gen Z is making a definitive push for homeownership where the prior generation has stagnated.

Hana Ben-Shabat is the author of Gen Z 360: Preparing for the Inevitable Change in Culture, Work, and Commerce, and she founded Gen Z Planet, a firm that “[helps] brands prepare and adjust to the changes that Generation Z is bringing to the workplace and the consumer market.”

Her insight is clearly valuable, making her assertion that Gen Z is more likely to buy homes less speculation and more prophecy.

“Considering their focus on securing their future, home ownership is a piece of the puzzle,” Ben-Shabat says. In a related survey, she notes that 87% of Gen Z participants expressed interest in owning a home sometime in the future; only 63% of millennials echoed that sentiment.

Gen Z participants also had a stronger inclination toward viewing homeownership as a financially smart decision rather than a burden.

Gen Z’s open-mindedness toward purchasing homes may seem surprising at first glance. Ben-Shabat acknowledges the financial hardships placed on this generation, and posits that, having seen millennials struggle with student debt and the recession of 2008, this generation has arguably more incentive to stay away from large investments.

But she also points out that Gen Z buyers are “determined to learn from the mistakes of others and secure their financial future as early as possible,” adding that they “benefited from a wave of consumer financial education that began after the housing crisis of 2008.

This makes for a generation that is both clear and educated regarding their financial goals and how to achieve them.

It’s also worth noting, as Ben-Shabat does, that millennials have a more tenuous grasp of DIY culture and the financial decisions that accompany it than their Generation Z counterparts. As “digital natives,” Gen Z buyers don’t object as strongly to purchasing starter homes and renovating; millennials, by contrast, find themselves purchasing more expensive properties that are “ready to move in” due to waiting an extended time before shifting toward homeownership.

Ben-Shabat’s observations foreshadow an increased market shift toward Generation Z ownership, especially in smaller, more affordable locations. As for the economic ramifications of the paradigm change, only time (and Ben-Shabat’s website) will tell.

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