Our thoughts on Zillow-Opendoor partnership
Plus, where homebuyer income is rising fast
One of our favorite sayings
We all deal with buyers who are on the fence and seemingly unmovable.
This is totally understandable. Buying a home is usually the biggest and most important investment a person can make.
But that’s where we come in. One of our many jobs is to help them make that decision.
When it’s 50/50, and we’ve explained all the benefits of owning property, this is what we like to say: “Let’s go ahead and buy real estate and wait, and not wait to buy real estate.”
I’ve found that, sometimes, that one line does the trick.
Zillow and Opendoor partner up
In a surprising development, long-time rivals Zillow and Opendoor are teaming up to streamline the home selling process for a “small” fee. As part of their multi-year partnership, sellers will be able to use a “housing super app” which aims to dominate online real estate by combining Zillow’s recognizable brand with Opendoor’s iBuying software.
Sellers can use this app to do the following:
Browse Zillow listings and work with Zillow agents, and then request an Opendoor offer on their home
Compare profit from a regular market sale through a Zillow agent to Opendoor’s instant cash offer, then bundle their choice with additional buying and financing services
While we believe this service will be competitive, especially in smaller markets, we expect it will struggle in larger markets and at higher price points. That level of clientele expects a high level of detail, hands-on service, and real expertise you just can’t get from iBuying. We’ll keep a close eye on this story when these services fully launch.
Are we headed into a buyer's market?
Buyers are back in the game. According to Redfin data from the last week of July and a recent report by Realtor.com, for the first time in weeks, there was a rise in mortgage purchase applications, home tours, and requests for home-buying services. Here’s what triggered that spike:
Mortgage rates dipped below 5% and were briefly down a full point from their summer high of more than 6%
The number of active listings jumped 31% from a year earlier
While overall monthly mortgage applications were down 16% YoY, activity in the last week of July jumped 1% week-over-week, the first increase in five weeks
The median home price is now at $380,187, which marks the slowest growth rate since July 2020
The monthly mortgage payment on a median home has dropped to $2,267, down from the record $2,467 we saw in June
We’re in the early stages of an exciting buyer’s market right now. Inventory is growing, buyers are active, and sellers (...who are willing to negotiate) are still getting a great price for their property. It’s so motivating to see these numbers because it proves how much opportunity is out there, if you know where to look.
Where homebuyer income is rising fast
Since the start of the pandemic, the average homebuyer’s income has soared in a handful of popular housing markets. The influx of high-earning remote workers raised the average buyers’ income in these cities by more than double the national average of 6.8%.
Check out the top 10 cities with the greatest average homebuyer income increase between 2019 and 2021:
Boise, ID - 24.1%
Austin, TX - 19.1%
Cape Coral, FL - 18.5%
North Port, FL - 18.5%
West Palm Beach, FL - 17.0%
Miami, FL - 16.9%
Phoenix, AZ - 15.9%
Stockton, CA - 15.3%
Tacoma, WA - 15.1%
Salt Lake City, UT - 13.8%
When income levels change so significantly, it impacts local markets in two distinct ways. First, when people start to earn more, they typically take that income and move to off-the-grid markets. We saw that a lot during the pandemic as high earners relocated to Arizona, Texas, Florida, and other smaller markets. Secondly, when local salaries rise in smaller cities, a number of those residents will take that opportunity to move to major metros like LA, NYC, and Miami. Either way, changing incomes create a number of opportunities for local agents.
The news that just missed the cut
Source: LA Times
This 10-acre Italian-style villa just took a $40M price cut
Backyard Office capitalized on this home trend just in time
The list of household maintenance essentials every first-time buyer needs
A day in the life of Mauricio Umansky, founder of The Agency
How real estate investment technology impacts the buying experience
Did you know HOAs can enforce these 5 weird rules?
Advice from James and David to win the day
Being your own boss can definitely be rewarding, but it requires incredible discipline, focus, and motivation. If you’re struggling to find your inner go-getter, try 1-2 of these quick tips:
Make a schedule, and stick to it!
Get clear on your goals
Dress the part, even when you’re working from home
Equip yourself with the right tools
Time-block your day for maximum efficiency
Be smart about when (and how often) you check your email
Learn how to turn your “work brain” off after hours
Schedule marketing time into your week
Build a network of peers and mentors to lean on and learn from
Don’t neglect your self-care!
Want more motivation and productivity resources? Check out this article.
Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Rocket Mortgage
Today’s top stories really prove that we’re in a season of opportunity. Buyers are busy, inventory is growing, and in a number of cities, people are ready to put their rising income to good use! Make the most of every chance you get to network, grow your leads list, and build relationships. Your work today will pay off for months to come!
- James and David
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