Lower Sales Bit into REALTOR® Paychecks

Lower Sales Bit into REALTOR® Paychecks. Image courtesy of Stuart Miles / FreeDigitalPhotos.net

The decline in sales took a chunk out of overall business activity for REALTORS® as well as their incomes in 2014, shows the newly released 2015 National Association of REALTORS® Member Profile.

“Existing-home sales didn’t surpass year-over-year levels until October, which is likely the reason the typical member had 11 transactions last year versus 12 in 2013,” says Lawrence Yun, NAR’s chief economist. What’s more, slightly fewer transaction resulted in the median gross income of a REALTOR® dropping to $45,800 from $47,700 in 2013.

“Despite the modest setback, median gross income last year was still the second highest since the downturn and up over 5 percent from 2012 (when it was $43,500),” Yun says. “Furthermore, NAR membership at the end of 2014 stood at 1.1 million, up 5.5 percent from 2013.”

The median gross income and number of transactions tended to increase with years of experience of the REALTOR®. In 2014, REALTORS® in the business for more than 16 years earned $68,200 and made 13 transactions. On the other hand, REALTORS® with three-to-five years earned less than half that amount ($37,400) and had 10 transactions.

Incomes also varied by license type, as members licensed as brokers in 2014 earned $65,300 ($66,300 in 2013), while the median earnings for sales agents fell $1,100 from the previous year to $33,900, the member survey showed.

NAR added more new members last year as the housing market recovery took hold across the country. The median years of experience in real estate remained at 12 years for the second consecutive year, but more members — 17 percent — said they had been in the business for two years or less (compared to 13 percent in 2013), according to the survey.

Also, the median age of members inched up to 57 years (from 56 years in 2013). Overall, 2 percent of all REALTORS® are under 30 years of age, 18 percent are between ages 30 and 44, and 25 percent are 65 and older, the survey showed.

Source: National Association of REALTORS®

Home Owners See Solar, Wind in Their Future

Home Owners See Solar, Wind in Their Future. Image courtesy of Danilo Rizzuti / FreeDigitalPhotos.net

The preferred energy sources for the future of U.S. homes may be solar and wind, according to a new survey conducted by SolarCity, a solar installer, and Clean Edge, a marketing research firm.

Of the approximately 1,400 home owners surveyed, half identified solar energy as the most important energy source for the future of housing—regardless of where respondents lived or their political views. Coming in second as an important future energy source was wind, followed by natural gas, increased efficiency, oil, hydro- and nuclear power.

On the other hand, the power sources that received the least public support were geothermal, coal, and biofuel/biomass.

About 87 percent of respondents surveyed said that renewable sources are important to the nation’s energy future. However, respondents said that “saving money,” not “reducing my environmental impact,” serves as the most important factor in deciding to purchase clean energy products and services. In fact, 82 percent of home owners surveyed cited saving money as the most important factor, while reducing the environmental impact was cited by 34 percent.

“Sustained double-digit growth rates for more than a decade reflect the long-term nature of this current shift to more efficient, cleaner, and environmentally friendly products and services,” the surveyors wrote. “But don’t be mistaken; as our research clearly points out, it is cost savings, much more than environmental factors, that are driving this monumental shift.”

The survey found the most popular energy upgrades that home owners are planning on for the next year are LED light bulbs (27 percent) and smart thermostats (12 percent). Fewer people cited pricier energy upgrades such as photovoltaic panels (6 percent), electric vehicles (4 percent), and heat pumps (4 percent).

Source: “What Home Owners Think About Clean Energy,” Green Building Advisor (June 2, 2015)

Amp Up Your Website’s Homepage Appeal

Amp Up Your Website’s Homepage Appeal. Image courtesy of Stuart Miles / FreeDigitalPhotos.net

Is your website’s homepage doing enough to interest buyers and sellers to contact you? Too many websites fail to maximize the power of their homepage, even though it’s often the most visited page to their website, according to a recent article at Forbes.com by contributor Neil Patel, cofounder of Crazy Egg, Hello Bar, and KISSmetrics.

“The homepage is often a battleground of competing interests, a hodge-podge of unfocused strategies, a showcase of poorly executed redesigns, and a circus of sheer confusion,” Patel says. Yet your homepage is the “entrance to your entire site. Your branding front.”

Patel says that too often, web creators fail to consider the main purpose of their website — whether that’s just to serve up listings, educate clients, sign up for a mailing list, or fill out a lead form. Patel recommends that a site’s homepage purpose be action oriented rather than information oriented.

“The unstated intent of many web pages is to ‘increase brand awareness or information.’ That’s good, but it’s neither actionable nor measurable. The best way to increase brand awareness is for your site visitors to do something,” Patel notes.

He also recommends emphasizing that central purpose of your site with calls to action throughout the site, particularly by using large buttons. Patel advises optimizing the site around that purpose as well as placing a form on the sidebar or header so visitors don’t miss it. A prominent phone number on the site’s header also allows for easy contact.

To get visitors to click on your call to action, you need to make them curious and excited to learn more, research shows.

Patel offers the following example: “Let’s say you’re a property manager selling your property management services to real estate investors. You understand their needs, their motivations, and their pain points. ‘Hey investors, your rental problems are solved! Call for the best rates in property management!'”

Patel says the load time is an important factor on your homepage, too. Half of web users recently surveyed expect a load time of 2 seconds — otherwise, they’ll go elsewhere.

Track your site’s load time as well as get more ideas of homepage fixes by inserting your URL into Google’s Page Speed Insights tool for a free report.

Source: “How to Create a Homepage That Drives Revenue,” Forbes.com  (May 19, 2015)

Your Sellers May Need Reality Check on Price

Your Sellers May Need Reality Check on Price. Image courtesy of smarnad / FreeDigitalPhotos.net

Your clients likely are overly optimistic about the value of their home, a new study finds. Home owners tend to overestimate the value of their properties by about eight percent, according to a study published in the Journal of Housing Economics.

Researchers say that the overvaluations often are from owners who miscalculate their estimations over the capital gains they’ve accumulated in the house. The study echoes similar findings from a recent survey conducted by Quicken Loans, which found a “widening gap” between what home owners think their home is worth and appraisers’ valuations.

In a recent article, The Seattle Times asked appraisers why home owners tend to overvalue their homes — besides the emotional attachment they likely have to it. The appraisers said homeowners tend to have unrealistic expectations about how much their improvements add to the home’s resale value.

“Consumers may think they can get back what they put into the improvements they’ve made over the years,” says Tom Horn, an appraiser in Birmingham, Ala. “But it doesn’t work that way.”

Appraisers also note that home owners often don’t realize that they may have over-improved their home compared to others in the neighborhood, which can lead to overestimated values. Owners may spend thousands of dollars for an ultra-gourmet kitchen when nobody else in their price point has done so, says Don Boucher, an appraiser in Washington, D.C.

Plus, home owners who install highly personal and costly remodeling items commonly don’t see the full-cost payback on those projects either. So, if a home owner installs a luxury indoor lap pool or spa for their personal desire, they can’t expect that prospective buyers will view it as valuable as they do.

Source: “Owners Tend to Overvalue Homes,” The Seattle Times (May 30, 2015)

Proof That Buyer Demand Is Strong

Proof That Buyer Demand Is Strong. Image courtesy of Stuart Miles / FreeDigitalPhotos.net

For the fourth consecutive month, pending home sales were on the rise, with contract signings climbing to the highest level since May 2006, according to the National Association of REALTORS®’ Pending Home Sales Index. All four major regions of the U.S. posted increases last month, with the largest gains in the Northeast and the Midwest.

The index, a forward-looking indicator based on contract signings, showed pending home sales up 3.4 percent in April month-over-month and up 14 percent above April 2014 levels, NAR’s index shows. This marks the largest annual increase since September 2012.

The steady gains in contract activity each month of this year is proof that buyer demand is strong, says Lawrence Yun, NAR’s chief economist.

“REALTORS® are saying foot traffic remains elevated this spring despite limited – and in some cases severe – inventory shortages in many metro areas,” Yun says. “Home owners looking to sell this spring appear to be in the driver’s seat, as there are more buyers competing for a limited number of homes available for sale. As a result, home prices are up and accelerating in many markets.”

NAR recently reported that existing-home sales cooled in April, falling 3.3 percent month-over-month, but taking into account pending home sales, Yun expects a rebound in home sales heading into the summer. But gains will rely on a boost in inventory levels and evidence of moderating price growth, particularly since interest rates are now starting to rise.

“The housing market can handle interest rates well above 4 percent as long as inventory improves to slow price growth and underwriting standards ease to normal levels so that qualified buyers – especially first-time buyers – are able to obtain a mortgage,” Yun says.

Source: National Association of REALTORS®

The Nation’s Top 10 Seller Markets

The Nation’s Top 10 Seller Markets. Image courtesy of jannoon028 / FreeDigitalPhotos.net

Tight for-sale inventories are bringing out the competition in several markets, as buyers bid up prices above asking prices. Out of 315 counties (with populations of at least 100,000 and at least 100 sales), 85 – or 27 percent – saw homes sell on average for at least 101 percent of their estimated full market value, according to RealtyTrac’s April 2015 U.S. Home Sales Report.

But in some markets, sellers fetched even more. The following were identified as the top seller markets:

• Alameda, Calif.: 108% (sale price percentage of market value)
• San Francisco, Calif.: 108%
• District of Columbia: 107%
• Forsyth, N.C.: 107%
• Yolo, Calif.: 107%
• Marin, Calif.: 107%
• Cass, N.D.: 107%
• Contra Costa, Calif.: 107%
• Alexandria City, Va.: 106%
• Shasta, Calif.: 106%

Source: RealtyTrac