Tag Archives: National Association of Realtors

Zillow to Pay $130 Million to NAR’s Move, Inc.

Move, Inc. and Zillow Reach Settlement Agreement

By Jeff Sorg, OnlineEd Blog

canstockphoto0389625 handshake(June 7, 2016) – The National Association of REALTORS is reporting in a press release that Zillow Group, Inc. has agreed to a settlement amount of $130 million in damages instead of going to trial to settle a 2014 lawsuit alleging misappropriation of trade secrets. Zillow Group and Move, Inc. are both reporting that they have reached an amicable resolution.

Move will receive the bulk of these funds but NAR hopes that they will invest this money to enhance the consumer experience on realtor.com® and benefit our members in support of the REALTOR® brand.

NAR reported that it will receive 10 percent of the settlement payment after Move deducts its legal fees, since Move covered the costs of the lawsuit. After this amount is determined, NAR’s Leadership Team will consider how best to apply those funds in service of NAR’s REALTOR® members; we will share that information as soon as a decision is made.

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

All information contained in this posting is deemed correct as of the date of publication, but is not guaranteed by the author and may have been obtained from third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

OnlineEd® is a registered trademark of Harlow Spaan and Jeffrey Sorg

NAR and zipLogix Enter Agreement to Provide zipForms® for Free to REALTORS®

NAR makes deal to provide zipForms as a free member benefit

By Jeff Sorg, OnlineEd Blog

for free text(Nov. 16, 2015) – The National Association of REALTORS® is reporting that is has inked a deal with zipLogix to provide zipForm PLUS® and zipTMS™ as a free member benefit to all NAR members.

This free NAR member benefit gives REALTORS® access to the forms they want and allows them to manage the transaction via zipLogix’s new zipTMS™, its Transaction Management System allowing agents to be able to store unlimited transactions to meet their state’s Department of Real Estate requirements.

For more information: http://www.realtor.org/articles/nar-announces-new-initiative-with-ziplogix

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

 All information contained in this posting is deemed correct as of the date of publication, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

CFPB Director Addresses National Association of Realtors®

Prepared Remarks of Richard Cordray
Director, Consumer Financial Protection Bureau

 National Association of Realtors

Richard Cordray

Richard Cordray

WASHINGTON (September 17, 2015) – Thank you for inviting me today.  That renowned philosopher from the Garden State of New Jersey, Bruce Springsteen, once said, “I have spent my life judging the distance between American reality and the American dream.”  For the past few years, we have all been judging that distance for ourselves, and we have seen how the worst financial crisis of our lifetimes caused the gap to widen for far too many people.  But as we continue to emerge from the Great Recession, we are now starting to see things turn around.  The housing market is finally breaking out in many areas around the country.  It is a very happy development, one that is good for consumers, good for real estate professionals, and good for the United States of America.

In the wake of the financial crisis, Congress created the Consumer Bureau with the sole purpose of protecting consumers.  We do that by working to ensure that people have access to consumer financial products and services; that these markets work in a fair, transparent, and competitive manner; and that consumers are empowered to take more control over their financial lives.  To begin with, our first major task as a brand-new agency was to address the serious problems in the mortgage market that caused the crisis in the first place.

Since opening our doors four years ago, the Consumer Bureau has been hard at work to put new rules in place to encourage common-sense, consumer-friendly business practices.  We have sought to take a balanced and measured approach to this task, mindful of the concerns of many stakeholders.  When Congress required us to finalize several substantial mortgage rules within our first eighteen months, we stepped up and got the job done.

When we put those new regulations in place, some were critical of our work.  For example, the “Ability to Repay” rule requires lenders to make sure that borrowers actually have the ability to repay their loans before extending them a mortgage.  Some enjoyed describing this rule, which was also known as the “Qualified Mortgage” or QM rule, as the “Quitting Mortgages” rule.  They made aggressive predictions that our rules would cause mortgage prices to double and would cut the volume in half.  They offered dire predictions that our rules would lead to the demise of community banks and credit unions, which would have to withdraw from the mortgage market altogether.  We never believed any of this unsupported hyperbole.

And it turns out we were right.  The rules have now been in place for the better part of two years, and none of those heated claims has come true.  In fact, recent data confirms the very opposite of the fears that were voiced by our critics.  In 2014, the first year of our new rules, mortgage originations for owner-occupied home purchases increased between 4 and 5 percent.  The upward trend appears to have accelerated over the first half of this year.  And while we saw minor consolidation in some parts of the mortgage market, there is no evidence of any mass exodus, as the doomsayers predicted.  In fact, after adjusting for merger activity, the number of lenders that reported having originated mortgages showed an increase in 2014.  And in particular, the number of community banks and credit unions that originated home-purchase mortgages last year was higher than the year before.  Let me say plainly, from my standpoint as the Director of the Consumer Financial Protection Bureau, that is great news.  It means more opportunity for more consumers, and a renewed pathway to the American dream in a mortgage market that has been strengthened by the changes we have made.

There is no reason to be surprised at this outcome, because our rules merely imposed common-sense requirements that lie at the heart of all responsible lending.  In addition, we have been taking pains to create some special rules to protect community banks and credit unions, which had amassed the lowest default rates right through the wreckage of the financial crisis.  Reasonable regulation of financial markets, which includes evenhanded oversight and enforcement of the law, should always tend to benefit the most responsible providers.  By taking on and rooting out unfair competition that gobbled up market share by driving down sound underwriting standards, the Consumer Bureau is supporting responsible lenders.  The market leaders of today are those that have remained focused on providing sustainable homeownership rather than just making a quick buck, no matter how.

At the same time, sensible regulation that includes substantial consumer protections should foster greater trust by consumers in the financial marketplace.  If people believe they will be treated fairly rather than becoming victims of predatory lending, they can develop a renewed sense of consumer confidence.  And in the past few years, as consumers have improved their own financial health and seen their home values stabilize in many parts of the country, those sentiments are gradually returning.  Steady and prepared consumers, along with sound lending, are the key ingredients in the recipe for an improved housing market.  And what that means for everyone here is that you now have the chance once again to show America what you do best:  provide excellent customer service and help put people in the right homes for the right price.

It is hard to appreciate fully what that means for so many people.  Most immediately, it means that for those who lost so much during the economic crisis, buying a house may again be within reach.  A home is the most important financial investment that many families will ever make.  At the same time, homeownership remains the sturdiest foundation for building wealth among the middle class.  Although many people intend to create a nest egg for the future, the mechanism that most reliably causes it to happen for many Americans is making the monthly payments on an amortizing mortgage.  Beyond that, as we all know very well, a house that becomes a home is much more than four walls and a roof.  Instead, it is a special place to call your own, a place to rest and feel safe, a place to raise a family and create lasting memories, a place to hold up as a source of pride and accomplishment.

The National Association of Realtors represents more than one million hard-working members – brokers, salespeople, property managers, appraisers, housing counselors, and more.  You suffered greatly during the crisis and its aftermath.  The new Consumer Bureau is here to work with you to ensure that consumers’ experience of the financial marketplace and the promise of the American Dream are one and the same.

In that spirit, to improve the mortgage market we are making sure protections are put in place at every stage of the process, from shopping for a mortgage to closing on the house to paying back the loan.  As I have already noted, in January 2014, our first set of mortgage rules took effect.  They restored sensible underwriting practices (such as documenting income to ban Liar Loans) and addressed some of the worst practices by mortgage servicers.  By the way, we have heard all over the country from real estate professionals who have been frustrated – and lost countless sales – by poor practices from mortgage servicers.  We have come to understand that your interest in improving servicer performance is directly aligned with the interests of consumers, and of the Consumer Bureau.  We will continue to work with you and listen to you about how we can improve these features of the mortgage market.

After getting through the first set of new mortgage rules, we turned to another important task imposed by Congress.  We integrated and streamlined multiple forms that consumers received at the application and closing stages of the mortgage process, to make the forms easier to use and understand.  This regulation was completed almost two full years ago, but will finally take effect on October 3.  Among other things, what we call our “Know Before You Owe” mortgage disclosure rule makes it easier to shop for a mortgage.

In essence, what we have done is to replace four overlapping mortgage disclosure forms and put in their place just two forms that consumers have told us are much easier to understand.  The first form is the Loan Estimate, which provides a summary of the loan offered along with the estimated costs associated with the mortgage such as taxes and insurance and closing expenses.  The second form is the Closing Disclosure, which offers a detailed accounting of the transaction.  With a simple accounting of payments and fees, these new forms show what people are getting into – the price and key terms of their loan and how its terms could change over time.  They present the information in plain language, in a format that is easy to follow, where the costs and risks of the loan are made clear.  And right up front on the first page, shoppers can see what they want to see the most:  the loan amount, their monthly payments, taxes, insurance, other property costs, and the total cash required to close the loan.  Our consumer testing shows that when borrowers use our new forms, they will end up with a better understanding of the final terms of their mortgage before they close on the loan.

The changes we have made also are designed to make comparison shopping easier.  Our efforts here have centered on reducing the information gap between lenders, who understand mortgage pricing inside and out, and consumers, to whom the process can often feel like a mystery.  We want to encourage consumers to focus on “shopping for a mortgage” instead of just “getting a mortgage.”  Consumers have much more power than they realize to shop for the best deal.  The power to comparison shop allows them to take more control of their financial lives and make better choices that will make a difference for themselves and their families.

Homebuyers will get the Loan Estimate no more than three business days after they apply for a loan.  If they apply for loans with multiple lenders, they will receive all the information in a common format to make a direct comparison between them.  Consumers will be able to see directly and immediately who is offering them better rates or cheaper fees.  Consumers will then be better able to weigh those price differences against other factors that matter to them.

When consumers have decided on a loan, our new rules also require lenders to give them the Closing Disclosure three business days before the closing occurs.  It summarizes the final loan terms and costs and presents a detailed accounting of the transaction.  Before people arrive at the closing, they can compare this form to their Loan Estimate to see what has changed.  Our form makes that comparison very obvious, which minimizes the potential for nasty surprises such as “bait and switch” increases in rates, fees, or settlement costs.  Should the Closing Disclosure become inaccurate due to three very limited sets of changes that are especially crucial – changing the loan product (say from fixed-rate to adjustable-rate), increasing the APR beyond certain limits, or adding a prepayment penalty – consumers must be given a revised Closing Disclosure at least three days before the closing.  Some have been spreading misinformation about this point, claiming that last-minute changes based on walk-throughs or similar circumstances will cause frequent three-day delays in the closing process.  That is simply wrong.  Sellers’ credits and the like will never require a new Closing Disclosure that delays the closing date.  Only the three very limited circumstances just described relating to changes in the loan terms will require a new Closing Disclosure.  This rule will reduce paperwork, remove confusion, and make the process more transparent – all changes that will help promote home sales, not hinder them.

To further help consumers with their mortgage shopping experience, the Consumer Bureau is also developing and providing unbiased tools and resources as part of our “Know Before You Owe” mortgage initiative.  We believe knowledge is power, and that empowered consumers are good for the marketplace.

In March, we released “Your Home Loan Toolkit,” which provides a step-by-step guide to help consumers understand the nature and costs of real estate settlement services, define what “affordable” means to them, and find the best mortgage to fit their personal circumstances.  Creditors must provide a copy to all home purchase mortgage applicants within three business days of receiving an application, which means millions of consumers will get this streamlined, plain-language document each year.  We encourage all industry participants, including the real estate professionals in this room, to provide it to potential homebuyers as early as possible in the home-buying process so they can use this information most effectively.

Another signature offering we are developing and refining for consumers is called “Owning a Home” – an online, interactive set of tools and resources to help consumers navigate the home-buying process and make sound decisions.  Right now we are greatly expanding this section of our website to help consumers shop for a mortgage and go about buying a home, from the very start of the process all the way to the closing table.  It can be found on our website at consumerfinance.gov.

While many people want to buy a home, getting their finances ready for homeownership can be a challenge.  Owning a Home helps people assess their spending, learn how to check their credit, and figure out how much they can spend on an affordable mortgage.  The site also guides them through the process of meeting with lenders and getting a prequalification or preapproval letter, helps them know what questions to ask when meeting with lenders, and assists them in gathering the paperwork they need to move forward.  Gene Koo, who serves as the head of Consumer Engagement at the Consumer Bureau, will be giving us a demo of some of these Owning a Home features here very shortly.

We also recently launched a real estate professional’s guide to our Know Before You Owe rule and our supporting tools.  This guide summarizes the key facts you need to know and provides handy tips for achieving smooth closings on time.  We encourage you to check it out on our website.

As we move forward, we will continue to look for ways to make the mortgage process easier.  This includes our work on the closing experience.  We are well aware that the sheer volume of the documents can be overwhelming to people who are generally unfamiliar with the process.  So we have been evaluating electronic closings and how improvements in technology can benefit consumers and lenders alike.  We recently conducted a pilot project which found that those who closed their mortgage using an electronic platform showed higher measures of understanding, efficiency, and feeling empowered than borrowers who used only paper forms.  Based on those results, we are strongly encouraging further industry action and innovation around “e-closings.”

The mortgage market has experienced dazzling changes in the past decade.  It has gone from being the overheated, increasingly irresponsible market that blew up the largest economy in the world, to retrenching dramatically into an overly tight and restrictive market where many good, creditworthy applicants could not qualify for reasonable loans.  Lack of effective regulation that fostered a race to the bottom in underwriting standards has now led to strong new regulations designed to protect and support both consumers and responsible businesses.  The result today is a mortgage market that is steadily recovering, with home values increasing in many areas and millions of homes emerging from their previous underwater status.  Through these sometimes bewildering changes, the National Association of Realtors has hung tough and worked toward better times ahead.  It has been a difficult decade, but you have embraced change as we have worked to make the marketplace fairer and more transparent for all Americans.  Adversity always presents a test of strength, but you have risen to the challenge.  Together we are building a more solid foundation so that you can thrive and so that families across the country can make the American Dream their reality.  At the Consumer Bureau, we salute you and thank you for doing what you do.

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

 All information contained in this posting is deemed correct as of the date of publication, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

Home Sales Slow in April, But Remain up From a Year Ago

(c) Can Stock Photo(Jeff Sorg, OnlineEd) –  Despite properties typically selling faster than at any time since July 2013, existing–home sales slowed in April but remained above an annual sales pace of five million for the second straight month, according to the latest report from the National Association of Realtors®. All major regions except for the Midwest experienced sales declines in April.

Total existing-home sales declined 3.3 percent in April, but have increased year–over–year for seven consecutive months and are still 6.1 percent above a year ago, according to the latest report from the  National Association of Realtors®

“April’s setback is the result of lagging supply relative to demand and the upward pressure it’s putting on prices,” said Lawrence Yun, NAR chief economist.” However, the overall data and feedback we’re hearing from Realtors® continues to point to elevated levels of buying interest compared to a year ago. With low interest rates and job growth, more buyers will be encouraged to enter the market unless prices accelerate even higher in relation to incomes.”

Properties sold in April faster (39 days) than at any time since July 2013 (42 days) and the second shortest time (37 days in June 2013) since NAR began tracking in May 2011.

“Housing inventory declined from last year and supply in many markets is very tight, which in turn is leading to bidding wars, faster price growth and properties selling at a quicker pace,” says Yun. “To put it in perspective, roughly 40 percent of properties sold last month went at or above asking price, the highest since NAR began tracking this monthly data in December 2012.”

NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark., cautions that closings for some home sales could drag after August 1 and into the fall as lenders transition to the new closing procedures and documentation required by the Consumer Financial Protection Bureau’s Real Estate Settlement and Procedures Act and Truth in Lending Act, or RESPA–TILA, integrated disclosure rule. “There likely will be bumps in the closing process while all parties get used to the new requirements,” he said. “We hope that the move away from the HUD–1 is smooth, but even if only 10 percent of transactions experience closing issues, that’s as many as 40,000 transactions a month.”

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

  This article was published on May 21, 2015. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

 

 

 

NAR Reports Sales Decline to Lowest Level in 9 Months

(c) Can Stock Photo(Jeff Sorg, OnlineEd) –  The National Association of Realtors® is reporting that existing-home sales declined in January to their lowest rate in nine months. All major regions experienced declines in January, with the Northeast and West seeing the largest, but sales remain higher than a year ago by 3.2% .

Total existing-home sales are completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 4.9 percent to a seasonally adjusted annual rate of 4.82 million in January, the lowest since last April at 4.75 million, from an upwardly-revised 5.07 million in December.

Lawrence Yun, NAR chief economist, says the housing market got off to a somewhat disappointing start to begin the year with January closings down throughout the country. “January housing data can be volatile because of seasonal influences, but low housing supply and the ongoing rise in home prices above the pace of inflation appeared to slow sales despite interest rates remaining near historic lows,” he said. “Realtors® are reporting that low rates are attracting potential buyers, but the lack of new and affordable listings is leading some to delay decisions.”

To view the complete report, click here.

 

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

  This article was published on February 24, 2015. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

Sellers Remain for All-Time-High of 10 Years Before Selling, Says NAR Survey

(Jeff Sorg, OnlineEd) —Pending home sales declined in October but remained at a healthy level of activity and are above year-over-year levels for the second straight month, according to the National Association of Realtors®.

“In addition to low interest rates, buyers entering the market this autumn are being lured by the increase in homes for sale and less competition from investors paying in cash,” said Lawrence Yun, NAR Chief Economist. “Demand is holding steady but would be more robust if it weren’t for lagging wage growth and tight credit conditions that continue to hamper those individuals looking for relief from rising rents,” he added.

The median existing-home price for all housing types in October 20147 was $208,300, which is 5.5 percent above October 2013. Monthly median price growth has averaged 5.8 percent in 2014 (through October) after averaging 11.5 percent last year.

“The increase in median prices for existing-homes has leveled off, representing a healthier pace that has kept affordability in-check for buyers in many parts of the country while giving more previously stuck homeowners with little or no equity the ability to sell,” says Yun.

Yun says evidence of rising home prices allowing more willing homeowners the ability to sell can be found in NAR’s annual survey released earlier this month, which revealed that the typical seller over the past year was in their home for 10 years before selling—an all-time survey high for tenure of home.

NAR also recently released its economic and housing forecast for 2015 and 2016. Yun is forecasting existing-home sales this year to fall slightly below 2013 (5.1 million) to 4.9 million, and then increase to 5.3 million next year and 5.4 million in 2016. Yun expects the national median existing-home price to rise 4 percent both next year and in 2016.

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 For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

  This article was published on December 2, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

 

Existing Home Sales Experience First Year-Over-Year Increase Since October 2013

(c) Can Stock Photo(Jeff Sorg, OnlineEd) – The National Association of REALTORS today is reporting that existing home sales rose in October for the second straight month and are now above year-over-year levels for the first time in a year.

Lawrence Yun, NAR Chief Economist, says the housing market this year has been a tale of two halves. “Sales activity in October reached its highest annual pace of the year as buyers continue to be encouraged by interest rates at lows not seen since last summer, improving levels of inventory and stabilizing price growth,” he said. “Furthermore, the job market has shown continued strength in the past six months. This bodes well for solid demand to close out the year and the likelihood of additional months of year-over-year sales increases.”

 

 

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

This article was published on September 18, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

First-time Buyers Fall to Lowest Level in Nearly Three Decades

(c) Can Stock Photo (Jeff Sorg, OnlineEd) – The share of first-time buyers fell to its lowest point in nearly three decades, according to an annual survey recently released by the National Association of Realtors® (NAR).

The long-term average in this survey, dating back to 1981, shows that four out of 10 purchases are from first-time home buyers. In this year’s survey, the share of first-time buyers dropped 5 percentage points from a year ago to 33 percent, representing the lowest share since 1987 (30 percent).

Lawrence Yun, NAR chief economist, says there are many obstacles young adults are enduring on their path to homeownership. “Rising rents and repaying student loan debt makes saving for a down payment more difficult, especially for young adults who’ve experienced limited job prospects and flat wage growth since entering the workforce,” he said. “Adding more bumps in the road, is that those finally in a position to buy have had to overcome low inventory levels in their price range, competition from investors, tight credit conditions and high mortgage insurance premiums.”

Yun adds, “Stronger job growth should eventually support higher wages, but nearly half (47 percent) of first-time buyers in this year’s survey (43 percent in 2013) said the mortgage application and approval process was much more or somewhat more difficult than expected. Less stringent credit standards and mortgage insurance premiums commensurate with current buyer risk profiles are needed to boost first-time buyer participation, especially with interest rates likely rising in upcoming years.”

The household composition of buyers responding to the survey was mostly unchanged from a year ago. Sixty-five percent of buyers were married couples, 16 percent single women, 9 percent single men and 8 percent unmarried couples.

The median age of first-time buyers was 31, unchanged from the last two years, and the median income was $68,300 ($67,400 in 2013). The typical first-time buyer purchased a 1,570 square-foot home costing $169,000, while the typical repeat buyer was 53 years old and earned $95,000. Repeat buyers purchased a median 2,030-square foot home costing $240,000.

When asked about the primary reason for purchasing, 53 percent of first-time buyers cited a desire to own a home of their own. For repeat buyers, 12 percent had a job-related move, 11 percent wanted a home in a better area, and another 10 percent said they wanted a larger home. Responses for other reasons were in the single digits.

According to the survey, 79 percent of recent buyers said their home is a good investment, and 40 percent believe it’s better than stocks.

Nearly nine out of 10 buyers (88 percent) financed their purchase. Younger buyers were more likely to finance (97 percent) compared to buyers aged 65 years and older (64 percent). The median down payment ranged from 6 percent for first-time buyers to 13 percent for repeat buyers. Among 23 percent of first-time buyers who said saving for a down payment was difficult, more than half (57 percent) said student loans delayed saving, up from 54 percent a year ago.

Eighty one percent of first-time buyers used a variety of outside resources for their loan down payment, in addition to tapping into their savings. Twenty-six percent received a gift from a friend or relative – most often their parents – and 6 percent received a loan from a relative or friend. Ten percent of buyers sold stocks or bonds and tapped into a 401(k) fund.

Ninety-three percent of entry-level buyers chose a fixed-rate mortgage, with 35 percent financing their purchase with a low-down payment Federal Housing Administration-backed mortgage (39 percent in 2013), and 9 percent using the Veterans Affairs loan program with no down payment requirements.

“FHA premiums are too high in relation to default rates and have likely dissuaded some prospective first-time buyers from entering the market,” says Yun. “To put it in perspective, 56 percent of first-time buyers used a FHA loan in 2010. The current high mortgage insurance added to their monthly payment is likely causing some young adults to forgo taking out a loan.”

Buyers used a variety of resources to search for a home, with the Internet (92 percent) and real estate agents (87 percent) leading the way. Other ways included mobile or tablet applications (50 percent), mobile or tablet search engines (48 percent), yard signs (48 percent) and open houses (44 percent).

Ninety percent of home buyers who searched for homes online ended up purchasing their home through an agent,” according to Yun. “In fact, buyers who used the Internet were more likely to purchase their home through an agent than those who didn’t (67 percent). Realtors® are not only the source of online real estate data, they also use their unparalleled local market knowledge and resources to close the deal for buyers and sellers.”

When buyers were asked where they first learned about the home they purchased, 43 percent said the Internet (unchanged from last year, but up from 36 percent in 2009); 33 percent from a real estate agent; 9 percent a yard sign or open house; 6 percent from a friend, neighbor or relative; 5 percent from home builders; 3 percent directly from the seller; and 1 percent a print or newspaper ad.

Likely highlighting the low inventory levels seen earlier in 2014, buyers visited 10 homes and typically found the one they eventually purchased two weeks quicker than last year (10 weeks compared to 12 in 2013). Overall, 89 percent were satisfied with the buying process.

First-time buyers plan to stay in their home for 10 years and repeat buyers plan to hold their property for 15 years; sellers in this year’s survey had been in their previous home for a median of 10 years.

The biggest factors influencing neighborhood choice were quality of the neighborhood (69 percent), convenience to jobs (52 percent), overall affordability of homes (47 percent), and convenience to family and friends (43 percent). Other factors with relatively high responses included convenience to shopping (31 percent), quality of the school district (30 percent), neighborhood design (28 percent) and convenience to entertainment or leisure activities (25 percent).

This year’s survey also highlighted the significant role transportation costs and “green” features have in the purchase decision process. Seventy percent of buyers said transportation costs were important, while 86 percent said heating and cooling costs were important. Over two-thirds said energy-efficient appliances and lighting were important (68 and 66 percent, respectively).

Seventy-nine percent of respondents purchased a detached single-family home, 8 percent a townhouse or row house, 8 percent a condo and 6 percent some other kind of housing. First-time home buyers were slightly more likely (10 percent) to purchase a townhouse or a condo than repeat buyers (7 percent). The typical home had three bedrooms and two bathrooms.

The majority of buyers surveyed purchased in a suburb or subdivision (50 percent). The remaining bought in a small town (20 percent), urban area (16 percent), rural area (11 percent) or resort/recreation area (3 percent). Buyers’ median distance from their previous residence was 12 miles.

The typical seller over the past year was 54 years old (53 in 2013; 46 in 2009), was married (74 percent), had a household income of $96,700, and was in their home for 10 years before selling, a new high for tenure in home. Seventeen percent of sellers wanted to sell earlier but were stalled because their home had been worth less than their mortgage (13 percent in 2013).

Yun attributes the increase in seller’s age and tenure in home to rebounding home prices. “Faster price appreciation this past year finally allowed more previously stuck homeowners with little or no equity the ability to sell after waiting the last few years,” he said.

Sellers realized a median equity gain of $30,100 ($25,000 in 2013) – a 17 percent increase (13 percent last year) over the original purchase price. Sellers who owned a home for one year to five years typically reported higher gains than those who owned a home for six to 10 years, underlining the price swings since the recession.

The median time on the market for recently sold homes dropped to four weeks in this year’s report compared to five weeks last year, indicating tight inventory in many local markets. Sellers moved a median distance of 20 miles and approximately 71 percent moved to a larger or comparably sized home.

A combined 60 percent of responding sellers found a real estate agent through a referral by a friend, neighbor or relative, or used their agent from a previous transaction. Eighty-three percent are likely to use the agent again or recommend to others.

For the past three years, 88 percent of sellers have sold with the assistance of an agent and only nine percent of sales have been for-sale-by-owner, or FSBO sales.

For-sale-by-owner transactions accounted for 9 percent of sales, unchanged from a year ago and matching the record lows set in 2010 and 2012; the record high was 20 percent in 1987. The share of homes sold without professional representation has trended lower since reaching a cyclical peak of 18 percent in 1997.

Factoring out private sales between parties who knew each other in advance, the actual number of homes sold on the open market without professional assistance was 5 percent.

The 2014 NAR Profile of Home Buyers and Sellers can be ordered by calling 800-874-6500, or online at www.realtor.org/prodser.nsf/Research. The study costs $19.95 for NAR members and $249.95 for non-members. Highlights of the report are available at no cost.

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For more information about OnlineEd and their education for real estate and mortgage brokers, visit www.OnlineEd.com.

  This article was published on September 18, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

Community Advice for New Real Estate Agents

Whether you are a brand new real estate agent or a seasoned professional, read on for some of the best tips from the real estate community!

The National Association of REALTORS® recently conducted an informal survey in which they asked members of the national real estate community for advice they would give to real estate professionals just starting out.  The volume of responses was overwhelming and the answers were diverse, insightful, and sometimes, entertaining!  We would like to share a few of our favorites.

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Starting your career in real estate can be challenging. Here are a few helpful tips from the community!

  • “Always answer your phone!” – Barbara
  • Never park in the clients driveway, unless necessary.” – Connie
  • “Lawyers don’t give law a “try”, doctors don’t give medicine a “try”.  Don’t give real estate a try.  You’ve chosen a career, not a job.  Conduct yourself accordingly.” – David
  • “Have a mentor and sign on with a company that believes in training.” – Rosemary
  • “Get up!  Suit up!  Show up!  Follow up!” – Lori
  • “If you have bad news, share it with your clients as soon as you get the information.” – Karen
  • Get yourself digitally marketed and your own personal website – and some luck!”  – KC
  • Accurate descriptions of listings are the most important part of your job and the easiest to screw up. Know the difference between a 1.5 and a 2 story. Glowing descriptions and embellishments may help you sell one house, but outright inaccuracies hurt your reputation and the overall market.” – Andrew
  • “Don’t buy leads! Focus your money, time and energy on people you know and meet. Statistics show that this is usually the greatest source of revenue for us, but so many throw money down a black hole in hopes that 1 lead will pay for the whole system.” – Kim
  • “Refer your clients to the most thorough, knowledgeable, honest home inspector you can find.”
  • “Turn your phone off at 6:30 pm in order to have some time for yourself and family.” – David
  • Take a lot of vitamins…you need a clear head to think, a strong body to take all the punches of stress!” – Marilou
  • “It would be wise to make sure you have an accredited home staging professional(*) on your team as you want to be able to market all of your listings as ‘staged,’ gaining you a fabulous reputation for taking care of your clients and helping them to sell their homes quickly and for the most amount of money!” – Maureen
  • “Always go to the building (department) and pull property cards and check taxes, never go by what’s in the listing!” – Francesca
  • Stay away from the naysayers and negative agents.” – Deborah

And the author’s personal favorite:

  • “Be likeable.”

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Forming a successful career in real estate can be a challenge, but it doesn’t have to be frustrating. Connect with individuals, organizations and groups that can point you in the right direction with helpful tips, advice, and guidance!

*Check out OnlineEd’s course, “The Power of Staging” to start staging your listings.
For information about the National Association of REALTORS®, visit their website.
For more information about real estate education provided by OnlineEd, visit the OnlineEd website.