Richard Swerdlow

Condo, Co-op Sales Are Up 6.1%; Could Signal an Upward Trend
Published: June 23, 2009

By Anuradha Kher, Online News Editor

Washington, D.C.--Sales of existing homes showed another gain in May, benefiting from favorable affordability conditions and a first-time buyer tax credit, according to the National Association of Realtors (NAR). May’s increase was the first back-to-back monthly gain since September 2005.

Existing condominium and co-op sales increased 6.1 percent to a seasonally adjusted annual rate of 520,000 units in May from 490,000 in April, but are 8.9 percent below the 571,000-unit level in May 2008. The median existing condo price was $173,800 in May, down 21.9 percent from a year earlier.

“From the sales point of view, things seem to be stabilizing,” Jed Smith, managing director of quantitative research, tells MHN. “While sales activity is relatively flat, it is slowly inching upward toward the 5 million-a-year mark we predicted. Even though we see an increase in prices from month to month, we are not able to say that prices have recovered.”

Lawrence Yun, NAR chief economist, expected an improvement. “Historically low
mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” he says. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory. However, the increase in sales is less than expected because poor appraisals are stalling transactions. Pending home sales indicated much stronger activity, but some contracts are falling through from faulty valuations that keep buyers from getting a loan.”

Overall existing-home sales—including single-family, townhomes, condominiums and co-ops—rose 2.4 percent to a seasonally adjusted annual rate1 of 4.77 million units in May from a downwardly revised level of 4.66 million units in April, but remained 3.6 percent below the 4.95 million-unit pace in May 2008.

“33 percent of all properties sold in May were distressed sales, as compared to as high as 49 percent a few months earlier, ” says Smith.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage edged up to 4.86 percent in May from a record low 4.81 percent in April; the rate was 6.04 percent in May 2008. Last week, Freddie Mac reported the 30-year fixed at 5.38 percent; data collection began in 1971.

Total housing inventory at the end of May fell 3.5 percent to 3.80 million existing homes available for sale, which represents a 9.6-month supply at the current sales pace, down from a 10.1-month supply in April.

Smith says the appraisal problem is serious. “Lenders are using appraisers who may not be familiar with a neighborhood, or who compare traditional homes with distressed and discounted sales. Stories of appraisal problems have been snowballing from across the country with many contracts falling through at the last moment. There is danger of a delayed housing market recovery and a further rise in foreclosures if the appraisal problems are not quickly corrected.”

By Mike Parker

RISMEDIA, January 30, 2009-”The problem with advertising,” my first boss told me, “is that there are unlimited places to spend money on advertising but only limited monies to spend. Because you can’t prove to me which works best, your request for advertising dollars is denied.”

That was back in (gulp) the late 1970s, when I was a brash young salesman working for a street-savvy boss in Manhattan. There was no Internet, then, newspaper and magazine advertising was King and direct mail was the prospecting method of choice, along with telephone follow-up. Much has changed, but the “problem with advertising” can still remain.

As an agent or broker, you share something with the public; you are bombarded with advertising messages the moment you pick up something to read, go to a movie, turn on the TV or radio, drive to work, turn on your computer, whatever-advertising is everywhere. I think there is a new “problem with advertising” and that is that the public is getting harder to reach and harder to convince of virtually any marketing message due to advertising fatigue-we’ve all developed a defense mechanism that allows our brains to sort of surf right over these bombarding advertising campaigns in order to avoid being distracted from our efforts to accomplish our lives.

With too many messages to remember and consider, we edit them out; sort of like TIVO eliminates ads in recorded TV programs so you can view them uninterrupted, later. That’s great as a consumer, but not so great if one is an advertiser-and all agents and brokers are advertisers.

How do you get your message out there, cheaply but effectively, and assure that it will be acted upon when people go looking for a home?

The best thing is for the buyer to come to you.

Merchants spend millions to entice the consumer to visit their stores. However, it’s likely that when you want to buy anything, you choose the store to visit (regardless of how many advertising messages have been fruitlessly targeted at you) based on personal experience, a referral from a friend or family member, the convenience or proximity to where you live, or a special advertising message that seeped through to your conscious mind. Once you visit the store, the dance of sale starts. That used to be the way houses were sold, too. Today, however, the methods have changed, and consumers love the Internet as a place to find out all about whatever it is that they wish to buy.

The reason that organic search is so powerful is because organic search does not bombard the buyer with advertising messages, it responds to the buyers personal search for the exact thing the buyer is looking to purchase. It is a totally passive advertising strategy-bringing them to you.

Instead of advertising that attempts to bring the buyer into your store, you are armed with a tool that brings the buyer to you when they honestly search for what they want! No pretending, no “mixed messages,” no reluctance to be honest about what they want-no-the Internet buyer enters exactly what they want into the search engine on their browser and waits for where the search takes them to. If you have exactly what they want, 81% of the time, they will buy it from you. (It is a statistical fact that 81% of Internet buyers stick with the first agent they choose and it is also a fact that 92% of Internet home buyers find their agent through a major search engine.) 880,000,000 times every single month, a consumer types in a real estate-related search on Google-not to mention the other major search engines-trying to find that exact thing they want in the shortest possible time. You must be the agent they find and choose online, for if you aren’t, these statistics show that the person they do choose will get that business. It is far better that you are chosen, that you get the business. How do you do that?

The first step is that home buyers must be able to find you.

This is not as simple as it sounds-you need professional help, for it is what they find you under that matters and there is much competition who also wants to be found in that specialty. To be found means to be found under your specialty-not your name, not your brand-but under a description of what you do. The Internet buyer does not want to think, they want to act. Thus, they are likely to type in something like this: Antioch CA Short Sales if that is what they want to examine. (Rick and Joyce Tietz [1] www.tietzhomes.com are on the first page of Google for that and other searches and have 17 homes in escrow right now, for example.) Because buyers can find them easily simply by asking Google where to go to learn about Antioch CA Short Sales, their pipeline is full and business is very good in this difficult climate.

Once you can be found, your ability makes you succeed.

How many times have you asked yourself: “How many homes could I sell if I could just get more buyers to contact me?” How many times have you been frustrated because you know you are a good sales agent, but you have no one to sell to right now? Why not take some control of your situation?

Here’s a short analysis Chuck Marunde wrote in an online publication recently: “Buyers are no longer pulled by the big names of real estate companies branded on billboards or on TV commercials. The dominant branding of big names that was such a major factor in the 60’s, 70’s, and 80’s has faded just as the Internet has grown. Consumer loyalty is no longer to the “branded companies.”

Consumers are loyal to themselves, and that is the way it should be. Technology has finally given the consumer what they have always wanted-the power to choose. They choose the information they view, how and when they view it, and they choose what to do with that information without interference from anyone.

Standard and Poor’s to Track Condo Prices in Five U.S. Metro Areas
Published: November 25, 2008

Published: November 18, 2008

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