November 2020 Newsletter

As the calendar rolls into the holiday season, I am thankful to be a part of the AARC.  I just got my annual dues invoice from Executive Director Wade Adler, and while paying bills isn’t my greatest pleasure I got a lot out of the organization this year, and I am looking forward to good things in the AARC’s future.  As I noted a month ago, we’ve missed the great fun of the AARC’s annual conference, but there have been a number of AARC online functions and webinars that have gotten me out the the “house arrest” routine that COVID has brought us, and we’re always looking for new ideas (excuses?) to share time and resources.  We’d love to add any of your ideas to the docket – don’t be shy!

As an organization, the American Association of Retirement Communities offers us all a lot.   As a collection of smart, active and fun members, there’s even more to be thankful for.  Thank you for your participation in the AARC!

Bill Houghton
Chair, The AARC


What Real Estate Has to Be Grateful for in 2020

Melissa Dittmann Tracey, REALTOR Magazine | November 25, 2020


No doubt, 2020 has been a uniquely challenging year. With unemployment still above pre-pandemic levels, the country coming to terms with 
longstanding racial inequities, Americans worrying about natural disasters and coming off a contentious national election, and the COVID-19 pandemic still raging, people are searching for reasons to feel gratitude this Thanksgiving.

The housing market has emerged as an economic bright spot. While the nation continues to feel the widespread effects from 2020’s turmoil, here are a few things the real estate industry can be grateful for this year.

1. Booming home sales. Overall, real estate professionals have been busy. Homebuying activity is at its highest level since 2006. Defying high unemployment and an economic recession, the housing market has surged during the COVID-19 pandemic. Existing-home sales in October were 27% higher than a year ago, new-home sales were 32% higher, and pending home sales or contract signings in September jumped 20.5% annually. “This winter may be one of the best winters for sales activity,” Lawrence Yun, NAR’s chief economist, said during last week’s virtual 2020 REALTOR® Conference & Expo. “It won’t match summer or spring sales numbers, but on a winter-to-winter comparison, this could be one of the best breakout years just based on the fact that pending contracts are at such a higher level.” Mortgage applications, up 20% year over year, reflect buyers in the pipeline,  ready to buy. The downside: Buyers are in a frenzy to compete for the limited housing stock; 72% of homes that sold in October were on the market for less than a month, NAR’s data shows.

2. Record low mortgage rates. Home buyers are locking in some of the lowest mortgage rates ever in history. Last week, for the 13th time this year, the 30-year fixed-rate mortgage set a record low, averaging 2.72%, according to Freddie Mac. NAR’s Yun predicts that mortgage rates will stay low into 2021, averaging 3.1% for all of next year. “These ultra-low mortgage rates significantly lower mortgage payments, making housing more affordable than a year earlier in many areas,” even with prices rising, writes Nadia Evangelou, a research economist, on NAR’s Economists’ Outlook blog. For example, in the Washington, D.C., metro area, home prices have jumped nearly 12% compared to a year earlier, Evangelou notes. However, the monthly payment on a 30-year fixed-rate mortgage is lower than a year ago, averaging $1,820.

3. Seller equity. Home sellers are getting a boost financially from housing appreciation. The median existing-home price for all housing types was $313,000 in October—a 16% increase from a year ago. Sixty-five percent of 181 metro areas NAR recently tracked have reported double-digit price gains compared to a year ago.

That means home owners who haven’t taken a financial hit from the pandemic are feeling richer. In the third quarter, 16.7 million residential properties in the U.S., or 28.3% overall, were considered “equity rich,” according to a report from ATTOM Data Solutions, a real estate research data firm. A property is considered equity rich when the property owner has at least 50% equity in the home. “Homeowner equity in the third quarter added another pebble to the pile of markers showing that the U.S. housing market continues to defy the broad downturn in the economy this year,” said Todd Teta, chief product and technology officer for ATTOM Data Solutions. “Home prices keep rising, boosting the balance sheets of homeowners throughout most of the country. … The market is strong and homeowners remain in a position to benefit.”

4. Technology. With people forced to keep their distance during the pandemic, technology became real estate pros’ ally in keeping transactions moving. Nick Bailey, chief customer officer at RE/MAX LLC, said during last week’s REALTOR® Conference & Expothat the average real estate transaction takes 181 steps from beginning to end, and technology has increasingly responded to those steps. During state shutdowns earlier this year, real estate professionals increasingly relied on virtual and 3D tours, videoconferencing, augmented reality, automation, artificial intelligence, and remote online notarizations, Jeb Griffin, NAR’s director of strategy and innovation, said during the conference. “Technology is playing a more active role through the buying and selling cycle, and agents are playing an even bigger role to consumers who [have] less access to homes in person [due to the pandemic],” Griffin said. The future now requires “taking the traditional way of doing business and augmenting it with new ways that will allow you to serve customers in a variety of ways—and on their terms,” added Andy Ambrose, DocuSign practice lead director at DocuSign Notary. (Read more: Tech Tools to Help Pros Thrive During the Pandemic.)

5. New priorities. “The coronavirus without a doubt led home buyers to reassess their housing situations and even reconsider home sizes and destinations,” Jessica Lautz, vice president of demographics and behavioral insights for NAR, said about recent findings from the “2020 Profile of Home Buyers and Sellers.” “Buyers sought housing with more rooms, more square footage, and more yard space, as they may have desired a home office or home gym. They also shopped for larger homes because extra space would allow households to better accommodate older adult relatives or young adults that are now living within the residence.” (Read more: NAR Survey Reveals 14 Home Buying, Selling Trends Since the Pandemic.)

6. Affirmation of your value. As Americans reevaluated what they wanted from a home, they increasingly relied on real estate agents to guide them through purchase and sales transactions. Eighty-eight percent of buyers reported using an agent to purchase their home, and 89% of sellers used an agent to help with their sale, according to NAR’s survey. “We are all in unknown territory with this pandemic, so it’s no surprise that more buyers than ever turned to agents to help them navigate through some of the uncertainties and one of the most complex, competitive markets any of us have ever seen,” said NAR’s immediate past president Vince Malta when the Home Buyer and Seller Profile was released.

7. The sanctity of home. “Nothing feels more precious this year than the safety of our homes,” Shannon McGahn, NAR’s chief advocacy officer, told REALTOR® Magazine in addressing advocacy efforts of the association this year, “and we believe all Americans should have equal opportunity to a home of their own.”


New Home Sales Essentially Flat in October, Continuing Strong Fall Season

NAHB Blog | November 25, 2020

Sales of newly built, single-family homes in October dipped 0.3 percent to 999,000 from an upwardly revised September number, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. Despite the monthly decline, the October rate is 41.5 percent higher than the October 2019 pace, and on a year-to-date basis, new home sales are up 20.6 percent in 2020.

“Buyer traffic remained strong in October even as the country’s attention was focused on the elections and policy issues going into 2021,” said NAHB Chairman Chuck Fowke, a custom home builder from Tampa, Fla. “Mortgage rates remain low and builder confidence is at an all-time high indicating that demand remains steady and sales will remain solid.”

“NAHB analysis showed that the gap between construction and sales was at an all-time high in early fall. Thus, the NAHB forecast contains an acceleration in single-family starts and some slowing of the pace of growth for new homes sale to allow a catch-up,” said NAHB Chief Economist Robert Dietz. “Demand remains strong as home buyers seek out lower density markets as part of the suburban shift.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the October reading of 999,000 units is the number of homes that would sell if this pace continued for the next 12 months.

Inventory remains tight at a 3.3 months’ supply, with 278,000 new single-family homes for sale, 13.4 percent lower than October 2019. This is the fourth consecutive month with inventory running under four months’ supply. Of the inventory total, just 44,000 are completed, ready to occupy. These inventory numbers point to additional construction gains ahead, as indicated by record levels of the NAHB/Wells Fargo Housing Market Index.

The median sales price was $330,600. The median price of a new home sale a year earlier was $322,400.

Regionally, on a year-to-date basis new home sales were up in all four regions: 29.9 percent in the Northeast, 29.8 percent in the Midwest, 18.5 percent in the South, and 20.1 percent in the West.


Tech Tools to Help Pros Thrive During the Pandemic

Melissa Dittmann Tracey, Realtor Magazine | November 17, 2020

The average real estate transaction takes 181 steps from beginning to end, according to Nick Bailey, chief customer officer at RE/MAX LLC. During the COVID-19 pandemic, practitioners quickly adapted to complete those steps digitally and in a contactless way.

“A lot of the technology at the forefront right now isn’t new, but it may be new to a lot of agents,” said Bailey, who took part in a panel Monday during a session called “Emerging Technology: COVID-19 Transforming How REALTORS® Do Business” at the virtual 2020 REALTORS® Conference & Expo. “We have been slow to adopt these technologies, but we were forced to quickly adapt during the pandemic.”

During state shutdowns earlier this year, real estate professionals increasingly relied on virtual and 3D tours, videoconferencing, augmented reality, automation, artificial intelligence, and remote online notarizations, said Jeb Griffin, director of strategy and innovation at the National Association of REALTORS®. “Technology is playing a more active role through the buying and selling cycle, and agents are playing an even bigger role to consumers who are having less access to homes in person [due to the pandemic],” Griffin said.

Marilyn Wilson, managing partner at WAV Group, and other panelists gave a rundown of the technology tools that have become mainstream in real estate since the pandemic began:

  • Happy Grasshopper, HomeActions, and IXACTContact have helped real estate pros to maintain close contact with clients when in-person meetings aren’t possible.
  • Video messaging tools like BombBomb enable real estate professionals to respond to online leads or clients in a more personal way and helps them stand out from the competition.
  • Videoconferencing tools like Zoom and Microsoft Teams keep brokers connected to their agents and provide a platform for online training.
  • 3D home tours delivered through platforms like Matterport and Immoviewer enable buyers to peruse properties virtually.
  • Digital transaction management tools like DocuSign, Dotloop, and Notarize take transactions completely online so clients aren’t required to physically attend closings.
  • BoxBrownie helps real estate professionals to stage properties virtually as well as compile 2D or 3D floorplans to offer customers a sense of a home’s layout.

“Virtual tours are here to stay,” Bailey said. “Instead of viewing 15 houses in person, buyers may view 12 virtual tours online, and then they may want to look at three or four in person.”

But once the pandemic fades, “we can’t start falling back into old habits,” Wilson said. She cited research conducted by the WAV Group and the Houston Association of REALTORS® that shows consumers’ affinity for virtual tours, which help them narrow their home search. “Think of how many hours you could save as an agent, too. And your consumers are saying they’re already very comfortable with it,” she said.

The future now requires “taking the traditional way of doing business and augmenting it with new ways that will allow you to serve customers in a variety of ways—and on their terms,” said Andy Ambrose, DocuSign practice lead director at DocuSign Notary.

Look to your brokerage for more technology tools to adopt, panelists said. See what you already have access to that you may not be using. Also, look to your MLS and the National Association of REALTORS®. For example, access to the REALTORS Property Resource® is a benefit of NAR membership that you can use to create customized housing reports, panelists said. “If every agent, during or after the pandemic, just took away two pieces of technology that could help make them more efficient, it would be a reward to their business,” Bailey said.

The following companies are graduates of the NAR REACH tech accelerator program: BombBomb, BoxBrownie.com, Immoviewer, and Notarize. DocuSign is part of NAR’s Second Century Ventures. NAR has made strategic investments through Second Century Ventures and the REACH tech accelerator companies.