The nation’s second largest multiple listing service, Bright MLS, will begin allowing listing agents to put in a blanket offer of compensation for buyer brokers of zero dollars or more, starting on August 9.
This change appears to possibly diverge from a National Association of Realtors rule, which states that listing agents must make an offer of cooperative compensation to buyer brokers in order to list a property on the MLS.
While Bright MLS, which serves clients in Delaware, Pennsylvania, Maryland, Virginia, New Jersey, Washington, D.C., and West Virginia and represents 42 Realtor association, acknowledges that this is a small change, as previously the lowest amount allowed was one cent, it says this is a large change in terms of transparency.
“We are making this small change to underscore the complete flexibility of Bright subscribers to engage in transparent negotiations with their clients,” the firm wrote in an announcement on its website. “Bright’s MLS supports the most efficient marketplace by making property information widely and transparently available, and by facilitating blanket offers of cooperative compensation available to all buyer brokers on an impartial basis.”
The MLS noted that this change does not impact its impartial system of offers of cooperative compensation, and that offers of compensation remain negotiable and at the discretion of the home seller.
“Bright has always offered flexibility and has never specified a cooperative compensation amount,” the announcement states. “Sellers could agree to have their broker enter as little as one cent in the compensation fields, which was as close to zero as one could get. With this update, a listing agent will continue to be able to enter the cooperative compensation amount agreed upon with their seller client, from zero and up, and continue to negotiate compensation at their client’s direction.”
In an email, a spokesperson for Bright MLS said the MLS does not anticipate this impacting its relationship with NAR.
“Bright is making an independent business decision responsive to the needs of our subscribers – and the consumers they serve,” the statement read.
In addition, NAR said it supports Bright MLS’ decision.
“Bright’s view is consistent with the purpose of NAR’s policies, which are designed to ensure information is efficiently distributed to facilitate the transaction of real estate to the benefit of buyers and sellers. So long as cooperating brokers are aware of the offerings made by listing brokers, that purpose is achieved. NAR has long said listing brokers and their clients are the ones who determine the amount and makeup of the offer to cooperating brokers,” Mantill Williams, NAR’s vice president of communications, wrote in an email. “Practically speaking, the difference between one penny and $0 is negligible, and regardless, those offers are always negotiable. These policies ensure brokers are efficiently sharing information they and their clients need through their local, independent broker marketplaces. Without these policies, brokerages would not know important information about listings and they would have to rely on piecemeal information collected in inefficient ways that could negatively affect their ability to serve their clients and ultimately the U.S. economy.”
With three class action lawsuits — Nosalek, Burnett, and Moehrl — currently progressing through the courts, buyer broker compensation has been a hot topic. Bright MLS is currently listed as one of the 20 MLS co-conspirators in the Moehrl lawsuit, named after its lead plaintiff. The Moehrl suit is the largest of the three cases and defendants include NAR, Anywhere Real Estate, HomeServices of America, RE/MAX and Keller Williams.
MLS Property Information Network (MLS PIN), which serves clients in the New England area, recently signed off on a settlement in the Nosalek lawsuit in which it agreed to pay $3 million and to stop requiring sellers to offer buyer broker compensation. Unlike Bright MLS, MLS PIN is owned by broker owners and does not have to adhere to NAR rules.
A multiple listing service settled a lawsuit challenging Realtor commission rules for $3 million, a possible harbinger for several ongoing actions by home sellers alleging listing requirements are anticompetitive.
The case, Nosalek v. MLS Property Information Network, had class action status and was filed in the U.S. District Court for Massachusetts. Only the MLS agreed to a settlement, according to a June 30 legal filing. Other defendants in the case, both franchisors and brokerages, were not part of the agreement.
Sellers, along with the Department of Justice, are pushing for a major change to the real estate industry’s compensation structure that both its proponents and opponents agree will affect every party involved in home buying.
“Life after all of this is gonna be quite different,” Dennis Norman, a real estate broker and owner of More, Realtors, said. “And I don’t know if NAR survives because we’re talking about massive, massive amounts of money.”
Rules by the National Association of Realtors and associated multiple listing services, which are databases real estate brokers use to list and search for properties, are at the crux of all three major lawsuits — Nosalek v. MLS PIN, Sitzer v. NAR and Moehrl v. NAR. All three cases cite the Sherman Antitrust Act.
The Nosalek plaintiffs didn’t sue NAR, although they did go after realty companies like Century 21, HomeServices of America and Keller Williams. Their initial complaint, filed in December 2020, cites MLS PIN rules on Realtor commissions that say listing brokers must include a fee for the buyer’s representation on each property.
This is because of a coupled compensation structure: most home sellers pay for both the buy-side and sell-side broker fees.
Sellers who don’t offer a fee on the MLS PIN can’t list their home on the service. The lawsuit says this complicates the selling process because buyer agents use the MLS to search for their clients and popular websites like Zillow also use it for their home listings.
Another complaint in the lawsuit says if sellers offer a lower-than-normal fee, buyer agents can see this on the MLS and will likely steer their clients away from the listing.
As part of the settlement, MLS PIN agreed to change its rules on the topic, eliminating the compensation listing requirement. They will also require brokers to inform buyers that they can negotiate the buyer-broker fee and inform sellers that they can elect not to pay it.
HomeServices of America and its affiliates recently filed for summary judgment on the case, arguing there’s no evidence the company conspired with the MLS PIN to inflate commissions.
Both the Sitzer and Moehrl cases contain similar complaints, but are focusing on the NAR as well because of its strong influence on listing service rules: 97% of regional MLSs are affiliated with the NAR and follow its code of ethics, according to by T3 Sixty, a real estate consultant firm.
If the Sitzer and Moehrl lawsuits compel NAR to uncouple with MLSs as some industry voices like Norman are expecting, on top of large damages, the organization and its local chapters would lose their major draw: member-only access.
“I think that’s almost the last bullet for the associations,” Norman said. “MLSs are gonna have their challenges too… but they still have what everybody wants and they’re good for the consumer.”
How Realtors get paid Coupled commissions have been around for a long time. With this system, home sellers pay their listing broker 5% to 6% of the final sale price after closing. That commission is then divvied up evenly between sell-side and buy-side agents, who interact with the customers, and their broker agencies. The majority of each half goes to the agent.
For example, after selling a $300,000 house, a seller pays $15,000 in Realtor fees. Agents receive $6,000 each and their brokers $1,500 each for the sale. The buyer doesn’t pay any fees.
“The whole compensation system doesn’t make a lot of sense,” Steve Brobeck, a senior fellow at the Consumer Federation of America and a self-described public interest advocate, said.
Why are Realtors compensated this way? It evolved from the original system used in 1908 when the first iteration of NAR, the National Association of Real Estate Exchanges, was founded, according to a report by T3 Sixty.
Back then, the industry relied on an exclusive representation system: sellers hired a single listing broker for a fee. Buying brokers were sub-agents of listing brokers, and both sides had a fiduciary duty to sellers. When property sold, listing agents gave their sub-agents a portion of the commission fee.
Eventually, the industry moved away from the subagency model to properly align fiduciary duties, but it didn’t move away from coupled compensations.
“It’s a weird system,” Ann Schnare, a former Freddie Mac executive who ran a study on the compensation structure, said. “Admittedly, it wouldn’t be the first to come to mind, but the fact is that’s what exists… changing it, I think, would be unnecessarily disruptive.”
The NAR has a similar outlook: it resists the lawsuits’ efforts to outlaw shared commissions because they say it’s optional and the rate is negotiable.
Critics of the system like Brobeck point to uniform commission rates despite this negotiability. Brobeck found that in 24 cities across the country, 88% or more of home sales had buy-side commission rates between 2.5% and 3% in a CFA report.
“This rate uniformity is striking evidence of the lack of price competition in the residential real estate industry,” Brobeck said in the report.
Other antitrust lawsuits Legal action over commission fees began in 2018, when a 10-year settlement between the DOJ and the NAR expired. Before crafting a new agreement, the DOJ and Federal Trade Commission held a joint workshop about competition in the real estate industry.
In 2020, the DOJ filed a new lawsuit against the NAR under the Sherman Antitrust Act and simultaneously settled with the association. The settlement required several changes to NAR’s code of ethics to provide “greater transparency to consumers about broker fees.”
The settlement banned buyer brokers from advertising their services as free unless they receive zero compensation from any source. It also prohibited these brokers from searching MLSs by filtering out properties with low commission fees and pushed for greater transparency on those sites.
Because of the settlement, many MLSs began to publicly post commission fees for each property. Redfin and Zillow followed suit. For the first time, homebuyers saw how much their agent would earn from each listing.
But then, the DOJ pulled out of the settlement in 2021 because it prevented them from investigating the association’s rules further.
The Moehrl and Sitzer lawsuits popped up around the same time as the DOJ’s initial workshop.
On March 6, 2019, Christopher Moehrl sued Realtor companies “for conspiring to require home sellers to pay the broker representing the buyer of their homes, and to pay at an inflated amount, in violation of federal antitrust law.”
Then, in April 2019, Joshua Sitzer and Amy Winger, Scott and Rhonda Burnett and Ryan Hendrickson filed a similar lawsuit in Missouri.
Both plaintiffs sued the NAR along with large national broker franchisors: Realogy (now Anywhere Real Estate), HomeServices of America, RE/MAX Holdings, and Keller Williams Realty, as well as HomeServices affiliates BHH Affiliates, HSF Affiliates and The Long & Foster Companies.
Real Estate Exchange, a real estate brokerage, also filed an antitrust lawsuit in 2021 against the NAR, Zillow and Trulia. The lawsuit alleges that Zillow’s search features prevent “transparent access to home inventory.”
Will cash-constrained homebuyers suffer? NAR argues in press releases about the lawsuits that the coupled compensation system fosters market competition because it frees up cash for buyers, allowing them to make a larger down payment.
A study funded by HomeServices of America, a defendant in all three suits, supports the claim. It declares that unless lending changes come in tandem with revisions to this commission structure, it would hurt “minorities, lower income households, and first-time home buyers” the most.
Consumer advocates argue that agent fees won’t hurt buyers because their cost is currently built into home prices. If sellers no longer pay both agent commissions, home prices will fall, and buyers will have the same net cost.
Schnare, one of the study’s authors, said because most finance their home with a mortgage, that’s not true.
“If everything was cash, it wouldn’t make a difference,” Schnare said. “What seems like a small adjustment can make a big adjustment on what they can afford to pay and, you know, potentially hurt the lower end of the market, but with ripple effects upwards.”
Brobeck says this concern is exaggerated, and that lenders will adapt accordingly: “the only reason that argument has any force at all is because the industry supports buyers not being able to finance their commission on the mortgage.”
But Schnare’s study found it’s not that simple.
In order to avoid hurting cash-constrained buyers, lenders would need to change underwriting standards, specifically the loan to value ratio, which represents the borrower’s equity position in the property. This is the most powerful measure of default, the study says, and including an “extraneous factor” like buyer agent fees in the ratio could decrease its predictive accuracy. Schnare says government-sponsored enterprises, the Federal Housing Administration and the Department of Veterans Affairs are unlikely to approve of this change.
Even if they did, it would “require regulatory approval and coordination across multiple parties along the mortgage supply chain,” so Schnare expects it to be a lengthy, expensive process. In the meantime, first time homebuyers would struggle to pay broker fees out of pocket.
“We have what we have, we’re not starting from scratch,” she said. “That’s a big ask for something where the benefits are not entirely certain.”
But the CFA and REX both dismissed the study, citing its funding and accusing it of a faulty premise.
Either way, the industry might be forced to change — both the Sitzer and Moehrl lawsuits are going to trial and many expect the plaintiffs to win. The Sitzer trial is scheduled for Oct. 16, and the Moehrl trial will likely begin early 2024.
“I would not be surprised if there was a settlement before them in both cases,” Brobeck said. “And then the question is, will this settlement really lead to effective price competition?”
We all want our homes to look attractive and reflect our personal style, and we choose décor items to achieve both goals. Sadly, that sometimes means facing a substantial decorating or renovation cost.
If you plan to live in the house you own for years and years, decorate as you see fit. However, if you live in a rental and could move at any time, or if you plan to sell your home, think twice before investing in furniture, art or any fixtures you can’t take with you. The décor you choose today might not fit the vibe of your next home — forcing you to start all over — and if you plan to sell, some of the choices you make could turn off potential buyers.
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GOBankingRates reached out to people in the real estate and design fields to ask their advice about which décor items are a waste of money. Eight of their ideas follow.
Wallpaper
Wallpaper was a staple in homes in the 1960s and ’70s — look for it the next time you watch a rerun of “The Brady Bunch” or “Columbo” — but it fell out of favor. While you’ll see designers on HGTV shows incorporate wallpaper on some projects today, it’s usually on a sparse basis.
“Wallpaper patterns can quickly become outdated as design trends evolve. Opting for wallpaper with bold patterns or motifs that are currently in vogue might be appealing to you at the moment, but it could potentially look dated in a few years, making the room feel less attractive and in need of updating,” said Boyd Rudy, Michigan real estate associate broker with the MiReloTeam through Keller Williams.
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Themed Décor
Wendy Wang, a home design and renovation specialist, said it’s wise to resist the temptation to decorate according to a theme.
“For instance, a nautical theme with anchor accents, a sailing artwork or a beach theme with shells everywhere; they may seem appealing at first, especially to complement a certain environment or to show personal interests,” said Wang, owner of F&J Outdoor. “These items usually make a room look tacky rather than chic and sophisticated. They also age a space pretty quickly as the novelty wears off.”
Instead, she said to use the themed pieces as a complement, not a focal point.
“I would recommend investing in timeless, classic pieces and incorporate smaller accents to bring out the theme subtly. It’s really about balancing taste and personality with broader appeal,” she added.
Expensive Window Treatments
When it comes to covering windows, one home-design expert thinks you should keep it simple.
“Many people waste money on buying expensive and elaborate curtains to decorate their homes,” said Jessica Wilson, the editor and co-founder of InYouths LED Mirrors. “While these pieces may add visual appeal, they are often a wasteful investment. Fancy curtains can be difficult to clean and maintain, leading to a shorter lifespan compared to simpler window treatments. Additionally, these curtains may not complement future home décor, making them bad for resale value. Their intricate design can also make a room appear cluttered and unattractive. Instead, opt for simpler and more cost-effective window treatments to create an inviting and timeless home.”
Artificial Plants
If you want greenery in your home, real estate industry veteran Pete Evering said you should grow and care for real plants instead of buying artificial ones — especially if you plan to sell your home anytime soon.
“While faux plants may not significantly impact resale value, they can leave a negative first impression on your home, making it look cheap and lacking authenticity,” said Evering, the business development manager at Utopia Property Management. “Their manufactured appearance doesn’t give a natural feel and diminishes the overall visual appeal of the space. Visitors or potential buyers may perceive them as a sign of neglect or a shortcut taken in decorating. Instead of providing the freshness and vitality that real plants offer, faux plants can make a room feel lifeless and uninviting.”
Wall-to-Wall Carpeting
On some of those older TV shows, you’ll see carpeting — not wood, tile or luxury vinyl — on the floors. Sometimes even in the bathrooms. But real estate expert Roman Smolevskiy, the owner of A+ Construction and Remodeling in Sacramento, California, recommended making another choice.
“From a resale standpoint, wall-to-wall carpeting can be a detriment. Many buyers today prefer hardwood or tiled floors, both for their aesthetic appeal and their durability. Carpeting is often associated with allergens and can hide dust, dirt and other pollutants, causing potential health concerns. This can turn off health-conscious buyers or those with allergies.
“Design-wise, carpeting can make rooms appear smaller and dated, affecting the overall attractiveness of the house. With the current trend leaning toward minimalist and modern interiors, carpeting can seem out of place and hopelessly old-fashioned.”
Ornate Light Fixtures
“Picture a lavish crystal chandelier in a minimalist living room or an industrial-style pendant in a classic Victorian. It seems stylish at the time of purchase but is a waste of resources because it can clash with the home’s overall design,” said Zackary Smigel, the founder of Real Estate License Wizard.
“Aside from the aesthetic discord, such a statement piece can be a double-edged sword regarding resale. Potential buyers may find it overbearing or at odds with their taste, forcing them to consider the replacement cost even before purchase. I’ve had clients who loved a house but hesitated because of an ornate, expensive lighting fixture that needed to match their style.”
Water Fountains
Like wallpaper and light fixtures, beauty is in the eye of the beholder when it comes to water fountains.
“Yes, a beautiful water fountain near your home’s entrance or in the center of your backyard can add a touch of elegance to your property and promote a relaxing ambiance,” said Benas Leonavicius, the founder of HomeCaprice.
“However, water fountains can be very expensive décor items in terms of initial expense and installation. If you plan on selling the property in the future, you should also know they don’t add any monetary value to your home. In fact, they could even decrease the value of your home in the eyes of some homebuyers since prominent water features like this require frequent upkeep that could easily outweigh its merely aesthetic benefits.”
Throw Blankets
“One item that I often see people wasting money on when decorating their home is expensive designer throw blankets,” said Pieter Runchman, a Los Angeles interior designer who is the founder and CEO of Floor Theory. “Sure, they may be made with luxurious materials and have a trendy design, but the reality is that most people don’t want to deal with the hassle of getting them professionally cleaned every time they need a refresh. It’s like having a beautiful piece of art that you can’t touch or enjoy without fear of ruining it.”
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This article originally appeared on GOBankingRates.com: 8 Home Decor Items That Are a Waste of Money
Web-based real estate brokerage Redfin is expanding the availability of its instant offers service via a partnership with iBuying company Opendoor.
The partnership, announced last week, will allow homeowners who sell their homes on Redfin’s platform to get instant offers on their properties.
The way iBuying works is that companies like Opendoor buy the homes directly from consumers, at what they say is a fair market value price. The benefit for homeowners is a quick sale, though they usually have to pay higher fees and may miss out on a bigger offer they’d receive if they list their home normally.
Opendoor is said to be the largest iBuying company around, though it faces competition from real estate brokerages such as Keller Williams and other listings platforms such as Zillow.
“It’s a risky, capital-intensive business to buy all our customers’ homes,” Glenn Kelman, CEO of Redfin, told MarketWatch about the partnership. Still, Kelman said he believes that some home sellers will appreciate the convenience and option of bypassing the traditional sales process.
Redfin already has an instant offer service called RedfinNow, but it is only available in a few select markets. By partnering with Opendoor, Redfin can offer the service to many more homeowners.
For now the offer is being made available in Atlanta and Phoenix. Homeowners there can request an offer from Opendoor via the Redfin site or mobile app. They can then compare the offer they receive with their home’s estimated value, and decide if it’s a worthwhile option.
The companies will late evaluate whether they’ll expand their partnership into additional markets. Redfin says it also will continue to expand RedfinNow separately.
“Every homeowner should have a choice between putting a home on the market via a Redfin agent or taking an instant cash offer,” Kelman said. “No matter how fast RedfinNow expands, there will always be homes we can’t buy because it’s so hard to match our capabilities and capital with the market’s ups and downs. Just as traditional agents are our partner, for brokered sales our own agent can’t handle, Opendoor is our partner for giving customers reliable, competitive offers on homes we ourselves can’t buy.”
Meanwhile, recent studies have called into question the iBuying model. A recent MarketWatch analysis of multiple transactions involving iBuyers shows that the instant offers, on average, tend to be 11% less than offers received by owners who choose to sell their homes on the open market, when fees and other costs are factored in.
Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected]
SAN ANTONIO – The current average 30-year fixed mortgage interest rate is higher than 7%, which is a huge swing from the sub-3% rates we saw during the pandemic. So what impact are we seeing on the local housing market?
Real Estate Agent Ronnie Trevino with Keller Williams Heritage joined Leading SA to help break it all down.
“Well, rising interest rates, inflation, and increase in housing inventory have definitely caused homes to stay on the market much longer than they did last year. However, the fact that the average home price has only come down about half a percent, according to the San Antonio Board of Realtors’ latest press release, is pretty promising for prospective sellers and investors,” Trevino said.
Even though San Antonio home prices have increased, it is still a lower cost of living than in other parts of the state.
“San Antonio’s median home sales price remains relatively affordable. And there are several reasons why San Antonio is in high demand. We have, first of all, we have a great job market. We have affordable housing, and we have population growth and military presence. All these factors which could make San Antonio one of the best real estate markets in the nation. So we’re holding steady as compared to those other major metropolitan areas,” Trevino said.
However, the fact remains that interest rates are a big factor in home sales, and 7% is higher than most current buyers are used to seeing. Other than earlier this year, it is the highest average the country has seen since 2001.
Trevino expanded on the interest rates in San Antonio and what’ll happen after it eventually drops.
“I don’t think that they’re going to come down any time soon. I feel like we’re going to hold steady at 7% or above for a while, but I think they will eventually come down. And when they do, it’s going to put San Antonio on the heat radar again when it comes to housing,” Trevino said.
As for people buying homes in San Antonio, Trevino said there are noticeable trends in the market.
“The trend that we’re seeing now or that I’ve been seeing more and more of is that you know, another thing to consider is that we saw a 14% decrease in existing home sales while new construction saw a 36% increase. So we’re seeing a lot of younger families go to the far west side outside 1604 towards the Castroville area. There are a lot of affordable new construction homes that are available for sale there. And a lot of these builders are able to provide great incentives by utilizing their lenders. So a lot of people are seeing this as an affordable option and are taking that route,” Trevino said.
And as we see more and more apartment buildings taking shape around the community, renters aren’t seeing any reprieve from the high costs either.
Trevino explained how he believes prices will not drop anytime soon for renters.
“Rents are holding steady, and actually, they’re increasing. Slow but steady. We saw a 3% increase in rent from last year to this year. And, you know, I think one of the major factors and rents, we see all these new buildings coming up. Well, the percentage of single people living on their own has also increased. So I think that we need a lot more spaces to fill. So, yeah, rents I don’t think are going to come down any time soon,” Trevino said.
With the news this month that the housing market hit a milestone by showing the first year-over-year price decline in recent memory, homeowners who’d considered finally selling their home this year are finding themselves discouraged yet again.
What happened, they might wonder, to the not-so-distant glory days of frantic bidding wars and over-ask offers? Plenty of frustrated owners seem worried that the window for a fast and lucrative home sale might be shutting fast.
But here’s the reality: The U.S. housing market is no monolith. Although it’s true that many of the hottest markets of the past few years have seen prices fall in the wake of higher mortgage interest rates that broadly dampened home shoppers’ buying power, there are still cities where buyers continue to snatch up homes quickly and where sellers are getting their full asking price—or more.
This is why the Realtor.com® data team dug in to find the U.S. real estate markets that most favor sellers. (Sorry, buyers!)
The best places for sellers generally have persistently low housing inventory, strong demand from buyers, and often—but not always—lower prices that have room to swell. These are generally affordable metropolitan areas in the Northeast with a few in the Midwest.
Three of the metros on our list—Hartford, CT, Worcester, MA, and Providence, RI—are so close, you could tour homes in all of them in a single day. Our ranking also has one spot in the South and a somewhat bizarre outlier in California—more on that later.
To figure out if an area is a buyer’s or seller’s market, Pamela Ermen likes to track the change in the number of closed sales per month, compared with the change in the number of new listings per month.
“When sales are going up and inventory is going down, that’s a real seller’s market,” says Ermen, a Virginia Beach–based Realtor® at Re/Max and a speaker and coach at Real Estate Guidance.
Still, sellers who focus solely on low inventory can wrongly conclude that they can list their home at a higher price than an agent might advise. That can lead to their property languishing on the market not receiving strong offers. Meanwhile, buyers who focus only on the number of sales going down might wrongly think there’s less competition. That might result in heartache when they find out the hard way that many homes are still getting multiple offers.
To find true seller-friendly places, the Realtor.com data team looked at the May 2023 listing data for the 100 largest metropolitan areas. Then we ranked each based on the number of days that the median listing is on the market, combined with the portion of listings that have had the price reduced. These metrics tell us where homes are selling faster than average and with fewer sellers having to reduce their price to make the sale.
We selected just one metro area per state to ensure geographical diversity. (Metros include the main city and surrounding towns, suburbs, and smaller urban areas.)
Here’s where sellers can expect the market to be most tilted in their favor this summer.
Median list price: $265,000 Median days on the market: 13 Listings with a price reduction: 1 in 17
Rochester, on the western edge of New York along the southern shore of Lake Ontario, not only is at the top of our seller’s saviors list—it’s also in a class of its own. Rochester had both the lowest number of days on the market and the lowest portion of listings with a price reduction. But this is nothing new for the so-called Flower City.
The metro area has become a mainstay of the Realtor.com hottest real estate markets list. It’s also where sellers are usually still getting their asking price, and where buyers can find one of the largest selections of homes for less than $200,000. Plus, home prices are well below the national median list price of $441,500 in May.
These affordable homes have made the area appealing to locals, out-of-towners, and investors.
“If you’re priced right in our market, you can expect to still sell in about one week,” says Jenna May, a local real estate agent at Keller Williams Realty.
When the market was at its pandemic peak in 2022, and even before anyone had heard of COVID-19, Rochester was still leading the nation in the low number of days on the market. Demand here for homes is high and seems destined to stay that way.
“There are people who are offering $80,000 over listing price and not getting the home,” says May. “It’s that competitive.”
Median list price: $424,925 Median days on the market: 19 Listings with a price reduction: 1 in 14
The capital city of Connecticut is also no stranger to the Realtor.com list of the nation’s hottest real estate markets. Hartford is the largest population hub in the state, with 1.2 million residents.
It also boasts home prices that are about 5% below the national median.
“The Northeast has been well undervalued compared with other markets—and not just for years, but for decades,” says Lisa Barrall-Matt, a senior broker at Berkshire Hathaway in West Hartford.
Homes in the Hartford area have been priced $100,000 less than comparable homes in other markets, Barrall-Matt says, for so long that she began to take it for granted.
Now, she’s feeling vindicated: “I used to say, ‘Why aren’t prices higher?’ Now I’m saying, ‘Where’s the ceiling?’”
Median list price: $622,500 Median days on the market: 24 Listings with a price reduction: 1 in 13
Portland became a popular pandemic destination for Northeasterners looking for a scenic, coastal city with some great restaurants, entertainment, and a brewery scene. The area has a rich history, having a Native American presence dating more than 10,000 years before becoming an early Colonial settlement.
The above-average prices in this artsy city on Casco Bay aren’t keeping sellers from enjoying quick sales. In fact, few listings are getting marked down. The demand for housing here is just so strong. Portland has been featured on our list of the best places to retire in 2022, and it has one of the last year’s hottest neighborhoods: Windham, just on the northwestern edge of Portland proper.
Prices in Portland have grown significantly faster during the pandemic—from May 2019 to now—than they did in most of the country. Where prices rose about 40% nationally, prices in Portland have grown by about 62%. Just since this time last year, prices rose 17%.
A newer four-bedroom home in South Portland that’s within walking distance of Fore River is listed for $650,000, close to the area average.
Median list price: $517,450 Median days on the market: 19 Listings with a price reduction: 1 in 10
Worcester, about 40 miles west of Boston, was nicknamed the “Heart of the Commonwealth” because of its central location in Massachusetts.
This medium-sized metro has a name that’s fun to say, like “rooster” but with a W. But it simply doesn’t have enough homes to match the high interest from potential buyers, according to Nick McNeil, a local Realtor with the Lux Group.
“The amount of demand and the absolute lack of inventory is nuts,” he says. “And there’s not much room for new construction in this area, with tight regulations on what can be built.”
Until there’s some kind of change in the supply and demand dynamic in the area, McNeil says, it’s going to be hard for buyers, and relatively easy for sellers—as long as they’re not also trying to buy.
“The best situation you can be in is if you can sell now,” he says.
Median list price: $384,250 Median days on the market: 25 Listings with a price reduction: 1 in 10
Amid the rolling hills of Eastern Pennsylvania’s Lehigh Valley, about 60 miles northwest of Philadelphia, Allentown has a few things going for sellers right now. The portion of homes with a price reduction is about half the national average, and homes are selling about 40% faster.
Like some other places on this list, the homes in this historic steel town are priced below the national average. But local incomes are a bit higher than average, offering buyers more affordability. That’s helping the real estate market to remain competitive as buyers seek out deals.
Allentown offers a mix of urban, suburban, and rural lifestyles, making it broadly attractive for buyers.
What’s especially notable about the area is the price growth over the past several years. Allentown metro prices have risen by 78% since before the pandemic, ahead of all the other places on this list.
For about the local median price in Allentown, buyers can find a five-bedroom bungalow in the Hamilton Park neighborhood west of downtown Allentown.
Median list price: $374,950 Median days on the market: 29 Listings with a price reduction: 1 in 11
Perched on the western shore of Lake Michigan in southeastern Wisconsin, Milwaukee is known for its breweries, including Miller and Pabst. It’s also where Harley-Davidson was founded. And it’s been a staple of housing affordability for some time.
However, prices have been rising in Milwaukee’s metro area: They rose by around 11% compared with this time last year.
The median number of days on the market is below the average now, just like it was before the pandemic. The same goes for the portion of listings with a price reduction. This is all very good news for home sellers hoping for a quick, profitable sale.
For $375,000, a buyer can get a large, four-bedroom home just 5 minutes from hiking trails, a golf course, and a dog park, all along the shoreline.
Median list price: $386,973 Median days on the market: 29 Listings with a price reduction: 1 in 9
The Virginia Beach metro area, a popular vacation spot for beach, maritime history, and seafood lovers, is another place where incomes are higher than average and home prices are lower.
Last year, sellers could count on getting multiple offers, usually leading to potential buyers bidding up the price, says Virginia Beach–based Realtor Ermen. Now, it’s not as easy to figure out that pricing sweet spot. If the home is listed too high, that’s when there’s eventually pressure to reduce the price.
In the month of May, even with a low number of price reductions, Erman says, “90% of price reductions were made before the listing hit the average time on market.”
That indicates sellers are getting antsy, and probably would have been better off pricing the home lower to begin with. But homes that are priced to sell are still moving briskly.
Median list price: $1,530,000 Median days on the market: 25 Listings with a price reduction: 1 in 9
San Jose is the oddball on this list.
Nestled in the heart of Silicon Valley, it is one of the most expensive real estate markets in the nation. Homes in this San Francisco Bay Area hot spot cost more than triple the national average, which means real estate attracts a very specific buyer.
Because San Jose is a global technology hub, its population is very diverse, and not just racially or ethnically. Roughly 40% of residents were born outside of the U.S., according to the U.S. Census Bureau. Most significantly, many residents have tons of money to spend, whether they’re high-salaried tech employees or they have had an entrepreneurial startup windfall.
Local real estate agents will tell you that San Jose is simply insulated from many of the market dynamics because the clientele is so wealthy. If they’re making an all-cash purchase, they don’t have to worry about higher mortgage rates. And that’s a big boon for sellers.
Median list price: $539,950 Median days on the market: 31 Listings with a price reduction: 1 in 10
Providence, home to Brown University and the Rhode Island School of Design, is a bustling town filled with older homes. About 50 miles southwest of Boston, it’s one of the medium-sized, Northeastern metros on our list that are enjoying especially strong housing markets right now.
Providence prices are significantly above the national average, but compared with nearby Boston, where the median list price is north of $850,000, Providence is a downright bargain.
Plus, it’s got a lot going for it. It boasts beautiful scenery along the Seekonk River, a thriving arts scene, and good jobs. The headquarters for CVS is located in nearby Woonsocket.
In Providence, for $550,000, a little above the local average, buyers can find a midcentury two-bedroom home with classic brick construction about 15 minutes from downtown.
Median list price: $229,950 Median days on the market: 31 Listings with a price reduction: 1 in 9
Home prices in this Rust Belt city, which has struggled in more recent years, are still dramatically lower than the national average—about 45% less expensive. And with the focus of buyers on affordability, it’s no wonder that Toledo has taken off.
In the past year, median list prices in Toledo have risen by 25% (10% per square foot), which is quite a bit higher than before the pandemic.
For less than the median list price in Toledo, buyers can get a massive, six-bedroom home in Toledo’s Old West End neighborhood, just northwest of downtown.
Real estate professionals are increasingly opting for virtual house tours to show off their listings as the coronavirus outbreak continues to cause fear in the U.S.
The
move comes as Leonard Steinberg, chief evangelist and corporate
broker at Compass, called for a two-week moratorium on in-person home
showings. Meanwhile, Redfin’s CEO Glenn Kelman has said his
brokerage is canceling all open houses on its listings and limiting
in-person showings to no more than two clients at a time.
Virtual
tours are however proving to be a useful alternative to in-person
viewings, and more agents are turning to them. Some prefer to use
video call software such as FaceTime to walk buyers through their
properties.
“As a virtual tour provider in Washington, D.C., we are seeing an uptick in demand for video and more elaborate virtual tours so homeowners don’t need to have an open house,” Roman Caprano at Sky Blue Media told realtor.com. “In our market, homes sell in days, so any agents typically only invest in photos, but now they are purchasing more content.”
New
York City-based Ideal Properties Group last week launched a virtual
listing viewer called Showing on Demand.
Elsewhere,
the Washington Association of Realtors has announced that the
Northwest Multiple Listing Service has “made the difficult decision
to temporarily disable the public and broker open house feature in
the Matrix system,” its CEO Steve Francks said in a statement.
“Until
at least March 31, brokers will not be able to input, search, or view
public or broker open house information in Matrix,” he added. “Open
house information will not be available for display on member public
websites (IDX and VOW sites). NWMLS will separately contact all
listing brokers who have a scheduled open house to let them know it
has been removed from Matrix.”
Virtual tours used to be the domain of larger and more expensive homes when they first started becoming common, but Keller Williams salesperson David Kong told the New York Post that he’s now offering them to a much wider group of clients. While virtual tours can’t fully replace in-person showings, they do help prospective buyers to evaluate a property better when they can’t visit it physically.
“For
those that are concerned about the virus, this allows them to make a
more informed decision about the property and whether to get out and
go see it,” said Wes Jones, a managing broker with Keller Williams
in Bellevue, Washington, a Seattle suburb
Redfin
has also started posting interactive 3D scans of all of its listings,
so buyers can view them without any health risk. The service also
enables buyers to schedule a video chat tour with the listing agent
for homes sold by other brokerage. Redfin’s agents will discuss the
features of the home as they walk through it, and will respond to any
requests to pan the camera or zoom in on specific details.
As
for in-person home tours, Redfin has issued guidance to its
customers, asking them not to shake hands and practice “social
distancing”, which means staying at least six foot apart from
anyone else present during the tour.
“The reality is real estate is a contact sport,” said Cara Ameer, a real estate professional in California, to realtor.com. “And that means exposing yourself to a lot of potential germs from shaking hands, interacting at open houses, and touching all sorts of doorknobs and light switches multiple times a day. I think we need to adopt a new normal of practices during this period of time.”
Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected]
Real estate leaders have spoken out in the wake of the murder of George Floyd and the resulting protests against police brutality, vowing change in the industry.
National Association of Realtors President Vince Malta led the way, calling the death of Floyd “senseless and tragic”. He expressed sympathy for the family of Floyd, as well as others who’ve experienced similar grief and pain.
“Our neighbors in the communities where we work and live across America should feel safe and free from discrimination,” Malta said in a statement. “As longtime champions of fair housing, equality and inclusion are among NAR’s most cherished values. NAR is committed to leading the way on policies that address racial injustice and that build safe and inclusive communities. Building the future begins with equal access to housing and opportunity for all.”
Keller Williams CEO Gary Keller wrote in a letter to agents Monday that he believes racism is wrong, and that his company stands with the black community in support of equality. He said the company plans to create a task force within its International Associate Leadership Council that will come up with recommendations on how to eliminate racial disparity in the real estate industry.
“I will be reaching out to your regions immediately to ask for a nomination from each to join us in this critical effort,” Keller wrote. “I believe we can also set an example within the industry by committing more of ourselves to a better, and equitable future.”
Keller further asked his staff to “self-reflect, listen, learn and speak up to bring about change.”
“I believe that the real estate community has a unique opportunity to promote healing and reform,” Keller’s letter read.
Meanwhile, Redfin CEO Glenn Kelman said that he too was planning to do more within his own company.
“The most obvious thing is hiring and developing more people of color to positions of power,” Kelman wrote on Redfin’s blog on Sunday. “We say that we believe talent is equally distributed between people of different races, but most businesses, including Redfin, are run mostly by white people.”
Redfin plans to publish its annual report on employee diversity later this month, and will go into more detail about which of its diversity initiatives are working and which aren’t, as well as what the company plans next. He also said he plans to provide more education to his workforce on race and real estate.
“Let’s commit as businesses and business people to serve blacks and other people of color better,” he wrote. “Companies that employ hundreds or thousands may feel it’s beyond our control to stop one grocer or bank teller or broker from jumping to the wrong conclusion about a customer, and doing something racist that hurts that customer, and stains our reputation for years.”
Another executive, Compass CEO and co-founder Robert Reffkin, said he saw himself as a “black man who has felt out of place his entire life.”
In a company-wide email, he said he was heartbroken that the pain everyone is feeling now might still not be enough to bring about real change.
Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected]
North Carolina-based Truist Financial Corporation announced on Tuesday that seasoned mortgage executive David Smith will be the head of Truist Mortgage effective July 31. Smith will replace the soon-to-be-retired Todd Chamberlain, who will assist with the transition.
Smith, whose experience includes leadership roles at companies such as Keller Williams and CitiMortgage, will oversee the strategy and execution of originations, fulfillment, servicing and warehouse lending.
In addition, Smith will lead the nationwide direct channels and correspondent business, reporting to chief retail and small business banking officer Dontá Wilson.
Wilson said that Smith positions Truist to “reimagine the future,” according to a news release.
Truist, a top U.S. mortgage lender and servicer, has shrunk amid a challenging mortgage market.
In the first quarter of 2023, the company originated $4 billion in mortgages, according to the Inside Mortgage Finance (IMF) estimates. The volume was 64% lower than in the same period of last year but was enough to rank the company the 15th largest residential mortgage lender in the country.
The company’s volume comes mainly from third-party originators. It originated $2.7 billion through TPO in Q1 2023, down 67.2% year over year. Meanwhile, the retail channel was responsible for $1.3 billion, a 58.3% decline in the same period.
The firm’s owned servicing portfolio, now under Smith’s leadership, reached $272 billion from January to March, 10.4% higher than in the same period of 2022. Truist is the 12th largest servicer by owned portfolio in the U.S, according to the IMF data.
Prior to joining Truist, Smith led the mortgage lending, insurance and title businesses affiliated with Keller Williams. Before that, Smith was the president and chief executive officer of CitiMortgage, a subsidiary of Citibank, where he navigated the financial downturn of 2008. His expertise is in building product breadth and pricing strategies for clients.
Smith said that he targets with his new position at Truist to deliver an “innovative, digital-first client experience to help even more clients bring their dreams into reality and achieve financial happiness,” according to a news release.
Truist Financial is promoting David Smith to head up its mortgage business, replacing Todd Chamberlain who will be retiring effective July 31.
Smith joined the Charlotte, North Carolina bank as deputy head of mortgage in January, following a near two-year stint as the president of Keller Home Financial Service, an affiliate of real estate franchisor Keller Williams, according to his LinkedIn profile.
For over 13 years, Smith worked at Citi, and spent the last two as head of its U.S. mortgage division. He also has experience with servicing, not just at Citi (including as head of default specialty servicing), but also with prior positions at Aurora Loan Services and Select Portfolio Servicing.
In his new role, Smith will report to Truist Chief Retail and Small Business Banking Officer Dontá Wilson and lead all areas of mortgage, including originations, fulfillment, warehouse lending and servicing.
Smith is taking the top slot after company CEO Bill Rogers said on Truist’s first quarter earnings call that further cutbacks in the mortgage business were possible.
“David’s experience and accomplishments as a leader in the mortgage industry position Truist to reimagine the future of Truist Mortgage for our clients,” Wilson said in a press release. “As we mark David’s installment as leader, I want to also express my gratitude for Todd Chamberlain’s leadership to help make the American dream of homeownership come true for millions of clients — truly building better lives and communities.”
Chamberlain joined SunTrust in February 2018 as executive vice president, head of mortgage banking, moving to head of consumer lending solutions in January 2019.
Later that year, SunTrust agreed to merge with BB&T and following the completion of the deal was rebranded as Truist. Chamberlain stayed on board as EVP, head of mortgage banking.
Before joining SunTrust, and between two stints at Regions Bank, Chamberlain had replaced Sy Naqvi as the CEO of PNC Mortgage.