Real estate trends
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A real estate trend is any consistent pattern or change in the general direction of the
real estate Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more genera ...
industry which, over the course of time, causes a statistically noticeable change. This phenomenon can be a result of the economy, a change in
mortgage A mortgage loan or simply mortgage (), in civil law jurisdicions known also as a hypothec loan, is a loan used either by purchasers of real property to raise funds to buy real estate, or by existing property owners to raise funds for any p ...
rates, consumer speculations, or other fundamental and non-fundamental reasons.


Buyer agency growth

At one time, all
real estate broker A real estate agent or real estate broker is a person who represents sellers or buyers of real estate or real property. While a broker may work independently, an agent usually works under a licensed broker to represent clients. Brokers and agen ...
s and agents, or
Realtors The National Association of Realtors (NAR) is an American trade association for those who work in the real estate industry. It has over 1.4 million members, making it one of the biggest trade associations in the USA including NAR's institutes, so ...
, practiced "single agency", meaning they represented only the buyer or the seller. In the 1990s, the concept of buyer agency became popular, allowing a buyer to retain an agent who would represent the best interests of the buyer alone. The first national company to provide this service was The Buyer's Agent, Inc. A 2008 study by ''Consumer Reports'' indicates that prior to this development, a Realtor was presumed by state law to be working for the seller. The same study shows that buyers using buyer agents obtained a savings of $5000 in the price of the home as compared to prices paid by unrepresented buyers. It remains true that an unrepresented real estate buyer can still call the sellers agent to arrange a showing of the property. In such cases, the buyer should be advised by Agency Disclosure Laws (a state law in every state in the U.S.) that any information obtained, as well as all conversations and negotiations undertaken, will be for the benefit of the seller.


Lower commission rates

Historical rates are presented in a report by the
Government Accountability Office The U.S. Government Accountability Office (GAO) is a legislative branch government agency that provides auditing, evaluative, and investigative services for the United States Congress. It is the supreme audit institution of the federal govern ...
, Congress's investigative arm. A 2005 study of real estate commission rates, reported that realtors tended to charge, "about 5 percent to 7 percent of a property's selling price...". More recently, CBS News, "60 Minutes" television news magazine reported in 2007 that competitive pressure resulting from a record number of licensed agents has driven down the average sales commission rates paid by sellers. A new breed of marketplaces that enable agents to compete for sellers further add pressure to the commission rate structure. In some states, companies such as Redfin still advertise a commission, but provide a rebate to sellers based on the quality of their surveys reflected in post-close surveys. This is also fraught with difficulties. Another trend is the emergence of alternatives to the commission model, including flat-fee, hourly home selling, and for sale by owner tools.


Marketing trends

The
Internet The Internet (or internet) is the global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a '' network of networks'' that consists of private, p ...
has become a major
lead generation In marketing, lead generation () is the initiation of consumer interest or enquiry into products or services of a business. A lead is the contact information and, in some cases, demographic information of a customer who is interested in a spec ...
method for real estate marketing, eclipsing local newspapers and all other sources as the consumer's most preferred method to learn about homes for sale. "An overwhelming majority (87%) of recent home buyers in the US say they used the internet as an information resource during their home-buying process, and nearly one-third say they first learned about their newly purchased home from an online channel, according to a study by the
National Association of Realtors The National Association of Realtors (NAR) is an American trade association for those who work in the real estate industry. It has over 1.4 million members, making it one of the biggest trade associations in the USA including NAR's institutes, so ...
(NAR). The majority of real estate companies use popular internet marketing methods like SEO, advertising, and social media. Websites like
Craigslist Craigslist (stylized as craigslist) is an American classified advertisements website with sections devoted to jobs, housing, for sale, items wanted, services, community service, gigs, résumés, and discussion forums. Craig Newmark began th ...
(
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territo ...
), Daft.ie (
Republic of Ireland Ireland ( ga, Éire ), also known as the Republic of Ireland (), is a country in north-western Europe consisting of 26 of the 32 counties of the island of Ireland. The capital and largest city is Dublin, on the eastern side of the island. ...
) and Gumtree ( UK) became in the 21st century the main sources for both buyers and sellers. Rapid changes in the market environment forced some countries to introduce new laws regulating real property market on the web. Even with the introduction of the internet, traditional media and methods of generating leads were still an important part of Real Estate trend:
Mobile app A mobile application or app is a computer program or software application designed to run on a mobile device such as a phone, tablet, or watch. Mobile applications often stand in contrast to desktop applications which are designed to run on de ...
lications are also changing the way real estate agents conduct business. Apps like
Zillow Zillow Group, Inc., or simply Zillow, is an American tech real-estate marketplace company that was founded in 2006, and was created by Rich Barton and Lloyd Frink, former Microsoft executives and founders of Microsoft spin-off Expedia; Spencer R ...
,
Trulia Trulia is an American online real estate marketplace which is a subsidiary of Zillow. It facilitates buyers and renters to find homes and neighborhoods across the United States through recommendations, local insights, and map overlays that offer ...
, Zumper, and Rentberry are primarily accessed via mobile devices and have become very popular sources for listing properties for sale or rent. These applications function similarly to websites like Craigslist in that they allow agents or private sellers to list a property like they would in a classified ad albeit with a more dynamic display as well as mechanisms for users browsing a listing to contact the seller directly from the app. These platforms allow buyers to view homes in their desired area from anywhere. Mobile applications are particularly prominent with millennial real estate customers.


US government involvement

The
United States Department of Justice Antitrust Division The United States Department of Justice Antitrust Division is a division of the U.S. Department of Justice that enforces U.S. antitrust law. It has exclusive jurisdiction over U.S. federal criminal antitrust prosecutions. It also has jurisdic ...
announced the launch of a new website in October 2007 to "educate
consumer A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...
s and policymakers about the potential benefits that competition can bring to consumers of real estate brokerage services and the barriers that inhibit that competition." Among other findings, they report that certain new sales models can reduce consumer home sales costs "by thousands of dollars. For example, in states that allow open competition, some buyer's brokers rebate up to two-thirds of their commission to the customer, and some seller's brokers offer limited-service packages that let sellers list their homes on the local Multiple Listing Service (MLS) for as little as a few hundred dollars." The Justice Department updated their information in a new website in 2016.


Renting

Renting has recently been gaining popularity in the United States. This has become a more popular residential choice for younger generations due to student loan debt and more convenient locations. Some other pros for renting are amenities, flexibility, and credit building opportunities. The demand for rental units is increasing as there become more perks to renting.


See also

*
Real estate Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more genera ...
*
United States housing bubble The 2000s United States housing bubble was a real-estate bubble affecting over half of the U.S. states. It was the impetus for the subprime mortgage crisis. Housing prices peaked in early 2006, started to decline in 2006 and 2007, and reach ...
* Real Estate Transaction Specification (RETS) * Reduced-commission MLS Listings * Pocket listing (or exclusive listing) * List of real estate topics *
Market trend A market trend is a perceived tendency of financial markets to move in a particular direction over time. Analysts classify these trends as ''secular'' for long time-frames, ''primary'' for medium time-frames, and ''secondary'' for short time-fra ...
* :Real estate bubbles *
Case–Shiller index The Standard & Poor's CoreLogic Case–Shiller Home Price Indices are repeat-sales house price indices for the United States. There are multiple Case–Shiller home price indices: A national home price index, a 20-city composite index, a 10 ...


References


External links


U.S. Department of Justice: Competition and Real Estate
{{DEFAULTSORT:Real Estate Trends Real estate in the United States