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- Zillow’s rival takes massive swing
Zillow’s rival takes massive swing
Plus, invisible danger affecting home prices
Rinku Mathew
February 13, 2024
Sunday’s biggest winners?
There were a lot of big winners in the Super Bowl on Sunday. The Chiefs. Travis Kelce. His very-familiar-looking girlfriend. But the biggest winner of all might’ve been all the real estate agents who list with the fastest-growing listing site, Homes.com.
The company launched its massive marketing campaign in truly grand style. We have more details on their epic kickoff below, and why we think it’s a huge score for real estate agents everywhere.
On the subject of big campaigns, The Blueprint will be partnering with Homes.com as their portal sponsor for 2024. We are truly thrilled. We think it’s great how Homes.com allows agents to own their listings, and we think the site has proven itself to be a real threat to Zillow.
We think it’s going to be a big year for them and for our partnership!
- James and David
Homes.com investing $1B in massive Super Bowl marketing campaign
During the Super Bowl, CoStar the parent company of Homes.com, launched “the biggest marketing campaign in real estate history” by purchasing four ads during the game.
Homes.com is investing more than one billion dollars “to drive 80 billion impressions, reaching more than 90% of households, to generate millions and millions of visits” to the listings on their portal. This is a strong demonstration of the company’s commitment to real estate agents who list with them.
Our take
Very smart move by Homes.com! As we mentioned in an earlier post, we are fans of the company’s “your listings, your leads” business model. We are also bowled over by this massive marketing push. As the company said in its promotional video for the campaign, “no other competitor comes close to our investment to drive leads to all agents.” We can certainly see that! One Super Bowl commercial would be impressive; four ads are astounding. We wish all listing sites would do this. It’s the kind of marketing assistance that can really help agents.
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Mortgage rate optimism hits record high
36% of consumers expect mortgage rates to go down in the next 12 months. That’s according to Fannie Mae’s monthly Home Purchase Sentiment Index (HPSI) survey. That 36% is an all-time high for the survey. Here’s what else the company found:
The HPSI increased 3.5% points in January to 70.7, the highest level since March 2022, when the 30-year mortgage rate was around 4%
82% of consumers said they are not concerned about losing their jobs in the next 12 months, up from 75% in December 2023
17% of consumers believe now is a good time to buy, unchanged from December, but a slight improvement over November's all-time low of 14%
40% expect prices to remain the same, 37% expect prices to go up, and 22% expect them to go down in the next 12 months.
Our take
Consumers are really feeling good about their job situations right now and seem to think, that while prices won’t change, mortgages will drop in the next 12 months. This is excellent news for us agents as we enter the spring selling season. Yes, only 17% of buyers said it’s a good time to buy, but that’s where we come in. We can show them it’s a great time to buy! With prices expected to go up and mortgage rates expected to fall this year, buying now and refinancing later makes total sense.
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How air quality affects home prices
Source: Redfin
Home prices are 65% higher in places with high-risk air quality, Redfin reports. The median sale price in a high-risk metro was $563,710 as of December, far above the $341,483 price in low-risk metros. A "high risk" metro is one where at least 10% of properties fall into the “major, severe, or extreme, categories of risk” as labeled by the climate data organization First Street.
There are 13 major metros where over 85% of homes face high risk from poor air quality. All of these metros are in the West, where wildfires have been intensifying. Nine are in California alone.
Here are the metros where at least 85% of their homes are at risk from poor air quality:
Bakersfield, CA – 100%
Boise City, ID – 100%
Fresno, CA – 100%
Oakland, CA – 100%
Portland, OR – 100%
Sacramento, CA – 100%
San Francisco, CA – 100%
San Jose, CA – 100%
Seattle, WA – 100%
Stockton, CA – 100%
Tacoma, WA – 100%
Los Angeles, CA – 85.4%
Riverside, CA – 85.4%
Our take
This is truly one of the most alarming reports we’ve read. We are not scientists and cannot comment on the science surrounding reports like this, but we do carefully monitor any factor that affects housing prices and costs. We know that these issues are making it virtually impossible to get home insurance in many, if not all, of these metros right now. This is where NAR and other trade organizations can do some real good. They need to lobby our elected officials to take effective action soon, because the costs to consumers are already getting out of hand.
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Schematics
The news that just missed the cut
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What agents can learn about marketing from Taylor Swift
Learn how to protect yourself from real estate fraud
How much it costs to live in America’s most expensive cities
Guess whose Italian villa just listed for $538M
Foundation Plans
Advice from James and David to win the day
The Super Bowl is seen as the start of spring selling season. Although 2024 will be the second straight year in which mortgage rates exceed 6%, early signs point to more activity this spring than last. In today’s edition, we’d like to offer you some tips on how you can make the season as easy, advantageous, and regret-free as possible for your clients.
Use an appraisal contingency to protect your buyer – In most markets, when you make an offer, you should also make sure to include an appraisal contingency clause. It protects your buyer and indicates that the purchase contract is "contingent upon the appraisal meeting or exceeding the agreed upon contract price.” In previous years, buyers weren’t including these clauses to make their offers more attractive. If you choose to do that, make sure your buyers know that they will have to cover the difference if the appraisal comes back lower than the contract price.
Don’t skimp on repairs – It’s tempting to avoid doing this because the upfront costs are high. Encourage your sellers to repair and spruce up their homes IF they want to attract high-quality bids. Help your clients maximize their renovations and repairs by sharing which upgrades garner the best return on investment, and by reviewing neighborhood comps for insight into what buyers want.
Hire professionals to improve the quality of your listings – Nearly 40% of sellers told Zillow that better photos would have fetched a higher price for their home. Be sure that your listing photos and virtual tour videos present your client's property in the best possible light. Don’t do these yourself! Hire a professional. Similarly, we can’t emphasize enough: hire professional stagers! It makes a huge difference. Staging helps potential buyers imagine how the space can be used to its full advantage. Trust us: buyers need the help.
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Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Mortgage News Daily
The spring season is about to begin! How do you feel about it? What concerns you? Feel free to drop us a line and ask us anything. We truly love hearing from you. :)
That’s it for this edition of the Blueprint. We’ll see you on Friday!
- James and David
