Spring is in the air and summer is just around the corner! Many couples and families will be traveling the highways and byways for vacations as well as searching for locations to call home. This is your chance to develop partnerships with CVB’s, TDA’s and Planned Communities and show off your destination! The AARC has all those partnerships and more in place for you to see and prepare to capture the mature traveler and retiree.
We are looking forward to our Annual Conference in Wilmington Nov. 15-17, 2017. Registration is now open and it’s a wonderful opportunity to explore the nuts and bolts of our industry! Visit our Conference Page to learn more – AARC Annual Conference. Whether you’re a private developer, a chamber or tourism professional, or a government official, AARC is your information source!
U.S. new home sales rose strongly in February despite higher mortgage rates. The 6.1 percent month-over-month increase led to the fastest rate of sales since July. The prospect of future rate rises may continue to drive demand, but analysts note that warm weather may have pushed some demand forward and that supply limitations could constrain the market in the near-term. Source: ABC News
Sales of existing homes were extremely strong in March. Over 5.7 million homes were sold during the month, a 4.4% increase from the previous month and the highest level in over a decade. This level of demand is keeping supply tight, with 6.6% fewer homes available now than in 2016. The result is that homes are selling more quickly and for a higher average price. Source: National Association of Realtors
Andre’ Nabors Chair, The AARC
Housing Shortages Are Curbing Sales
News Release, Realtor.com | April 27, 2017
Pending home sales took a slight dip last month due to a dearth of homes for sale, the National Association of REALTORS® reported Thursday. The South was the only major region of the U.S. to see an increase in contract signings last month.
Despite last month’s national dip, pending home sales still remain elevated overall, posting the third best reading in the past year, according to NAR’s Pending Home Sales Index, a forward-looking indicator based on contract signings. Signings fell 0.8 percent in March to a reading of 111.4 on the index, but remain 0.8 percent above year-ago levels.
“Home shoppers are coming out in droves this spring and competing with each other for the meager amount of listings in the affordable price range,” says Lawrence Yun, NAR’s chief economist. “In most areas, the lower the price of a home for sale, the more competition there is for it. That’s the reason why first-time buyers have yet to make up a larger share of the market this year, despite there being more sales overall.”
Yun says the “painfully low supply” of homes for sale this spring could cause home prices to accelerate even more. Price growth was at 6.8 percent last month, NAR reports. Further, homes in March sold at a near-record price, and 42 percent of homes sold at or above list price.
“Sellers are in the driver’s seat this spring as the intense competition for the few homes for sale is forcing many buyers to be aggressive in their offers,” Yun says. “Buyers are showing resiliency given the challenging conditions. However, at some point—and the sooner the better—price growth must ease to a healthier rate. Otherwise, sales could slow if affordability conditions worsen.”
The South was the only major region of the U.S. to see an uptick last month, with pending home sales rising 1.2 percent to an index reading of 129.4. Pending home sales are now 3.9 percent above last March in the South, NAR’s index shows.
Pending home sales dropped 2.9 percent in the Northeast to a 99.1 reading in March, but are still 1.8 percent higher than a year ago. The Midwest saw pending home sales fall 1.2 percent in March to a reading of 109.6. Pending sales are now 2.4 percent lower than a year ago. The West also posted a drop last month, with the region’s index reading falling 2.9 percent to 94.5. Pending sales in the West are now 2.7 percent below a year ago.
Jessica Lynch/National Association of Home Builders
The recent turmoil in the housing and credit markets brought greater focus to the importance of fair and accurate appraisals. In response to
criticism that lax appraisals contributed to the financial crisis, tighter appraisal policies have been implemented by lenders, the Federal Housing Administration, Fannie Mae and Freddie Mac.
However, the pendulum has now swung too far and reports of homes failing to appraise at the sale price, or even construction cost, have become prevalent. Inaccurate appraisals remain a major impediment to the housing recovery, and therefore, finding solutions to these problems continues to be a major priority for NAHB.
NAHB believes that fundamental appraisal system reform is essential to restore confidence in the residential real estate market and to establish a foundation for sustainable economic growth. To address shortfalls in the appraisal process, appraisers must develop realist valuations based on sales that are truly comparable and lenders need to use appraisers who are knowledgeable and experienced in appraising specific property types located in a given market. Regulators, appraisers, lenders and all of the stakeholders in this debate must come together to establish regulatory guidelines for appraisers that acknowledge the reality of today’s marketplace.
Why It Matters
Flawed appraisals are harming new home values and killing sales in many markets because they do not accurately reflect the value of the home. Some appraisers are improperly using distressed properties – many of which have been neglected and are in poor physical condition – as comparables in assessing the value of brand new homes without accounting for major differences in condition and quality.
This is not only unfair and unreasonable, but it hurts home owners and home buyers alike. Many home owners seeking to refinance and take advantage of today’s affordable low interest rates are unable to do so because their house appraisals are coming in too low. A move-up buyer is out of luck if the appraisal on their existing home comes in below what they owe on their current mortgage. Likewise, many prospective home buyers have been left out in the cold because their dream house was appraised below the sales contract price.
Major reforms in appraisal practices and oversight are needed to ensure that appraisals accurately reflect true market values and don’t contribute to price volatility or harm aspiring home owners and move-up buyers.
Visit the National Association of Home Builder’s site to Learn More – Click Here
Does Virtual Staging Manipulate Buyers?
Erica Christoffer/Realtor Magazine, Marcy, 2017
Find out how one brokerage enhances listing photos without misleading potential buyers about the look and feel of a property. Plus: virtual staging services to add to your toolbox.
If potential buyers can’t picture themselves living in a home simply by looking at a listing photo online, they’ll move right along. So showcasing the best features of a property and making attractive use of the space isn’t just essential for in-person showings. “If a room is decorated as a carpeted nursery, it’s hard to imagine what it would look like as a bedroom or with hardwood floors,” says Tiffany Jonas, advertising and marketing manager at Kiawah Partners in Charleston, S.C.
Enter virtual staging, the process of using pictures of real rooms and changing the design elements or creating 100 percent virtual renderings for new-construction homes that do not yet exist. It’s not exactly a new concept in real estate—and it isn’t without controversy—but the technology and practice has made significant strides in recent years.
Jonas markets new luxury beach communities across Kiawah’s print, digital, and social media channels, as well as emerging interactive marketing technologies, including virtual reality and virtual staging. Her agency tends to use virtual staging for properties priced at or above $1 million or for vacant properties to broaden their appeal. “Perhaps a home is decorated very tastefully but traditionally. We might virtually stage some of the rooms to show what it would look like if it were furnished with more modern or transitional furnishings, or if the flooring were changed from tile to hardwood,” she says.
First, Kiawah’s agents always get written permission from sellers before they employ virtual staging techniques. “From the get-go, the agents explain to the sellers that we want to market their home in the best light and capture a range of styles,” Jonas says.
Kiawah often uses the virtual staging services of real estate photography company VHT Studios to switch out furniture or rearrange decor in an interior space. Staging the photo of a single room costs $199. “They’ve been accommodating to us in terms of our needs and the needs of our target audience,” says Jonas, who’s done branding for Fortune 500 companies around the world. “What will work for virtually staging a starter home, for instance, isn’t what will work for staging a luxury home.” And the quality of images has improved from just a few years ago, looking less digital and more realistic.
For new construction, they’ll use a freelance artist to do virtual renderings of rooms based on the architect’s plans. Kiawah also uses Village Features LLC, a virtual realty and 3-D rendering firm, for their new communities still under construction. Joshua Hale, president and cofounder of Village Features, estimates that the company’s VR tours have helped agents close 10 percent to 20 percent more late-stage prospects. A single 3-D illustration runs $995, and VR packages start at $2,495, which include a 360-degree branded tour that plays on any computer, phone, or tablet, as well as through viewing devices such as Google Cardboard, Samsung Gear VR, Oculus Rift, or HTC Vive for the immersive VR experience. To showcase existing homes, Kiawah uses Matterport technology, which they own in house, to film 3-D tours.
Services such as Virtual Staging Solutions offer packages from $225 for three photos up to $525 for seven photos, with bulk discounts available. Pick the furniture from their gallery of options, or you can get furniture removed from an image. They also offer hard-copy prints to display at the property.
Spotless Agency is another virtual staging company, which is based in New York but works with clients from around the world, offering both interior and exterior virtual staging, as well as renderings using floor plans of new construction. “We can improve exterior images in many ways, like changing finishes, adding landscape design, reconstruction—adding or removing some building parts,” says founder Andrew Zlobin.
He says it wasn’t long ago when virtual staging services were not considered a strong alternative to traditional physical staging. “It was mainly explained by lack of technologies [available] to make photo-quality images,” Zlobin says. That situation has changed with advancements in computer graphics and 3-D software. “It has raised the visualization level,” he says. Spotless’ pricing starts at $79 per image.
Then there are apps like Hutch, which is both a home shopping and virtual staging app available in the App Store and Google Play. Agents or clients can use it to upload a photo and try various interior design styles through a set of room filters. Slide between the before-and-after pictures by swiping an image transformation bar. Of course, the furnishings and products in the staged photos are for sale, which is how Hutch is monetized.
There were initial concerns at Kiawah over the use of virtual staging while still presenting a true picture of a property, but Jonas says the company purposefully addressed those before launching the marketing program. “The last thing we wanted was for a potential home buyer to see some staged photographs of one of our listings online, and then find while seeing the home with one of our sales executives that it’s not at all what they thought it would be,” she says.
Therefore, to avoid manipulating buyers, the company shows two versions of the photos: the room as it was originally photographed and the virtually staged room with the word “visualization” prominently watermarked in the corner of the image. “The potential home buyer can see that the kitchen currently has beautiful dark wood cabinets and dark quartzite countertops, say, but can also see what it would look like if the cabinets were painted white and the dark countertop was replaced with a white marble,” Jonas says. They also include a plainly written disclaimer about the virtual staging in the description of the property.
Jonas says Kiawah has also created simple printed packets of “before” and “after” room photos—which they call “DoubleTakes”—showing the original photo first and then the virtually staged photo with a prominent watermark. The cover page also includes the disclaimer. Kiawah has virtually staged 10 properties to date, with at least one buyer requesting to see a property specifically after seeing the virtually staged photos.
At the property itself, Kiawah displays the “after” photos on a larger scale, mounted on foam board and sitting on easels in the corresponding rooms. “The potential home buyer can plainly see the original, real room in front of their eyes and, in the mounted photo, how that room would look with different furnishings and finishes,” Jonas says. “When we started using this cutting-edge technology, not many companies were doing it,” Jonas says. “It speaks to our brand.”