Plenty of Interest, Limited Inventory Consumer confidence in the economy, employment, wages and their future financial situation have less to do with the current state of the real estate market than tight inventories, increasing interest rates, labor shortages and limited construction materials. Despite those limitations, all indicators suggest a strong 2017. The National Association of Realtors’ (NAR) Pending Home Sales Index (existing homes) was 112.3 for February 2017, which the second highest index since April 2006. The National Association of Home Builders/Wells Fargo National Housing Market Index increased significantly, to 71 for March 2017, compared to a 58 for March 2016. The present single- family home sales index increased from 71 for February to 78 for March.

It’s Time to Buy According to the NAR’s 2017 Home Survey, 72% of Americans surveyed during Q1 2017 think now is a good time to buy a home, and 47% think so strongly, compared to 44% during Q1 2016. The profile of those Americans who strongly support the idea of buying a home now is 55 years of age and older, a household income of more than $50,000 and living in the Midwest and South. Those that are less inclined to buy a new home now are 34 years of age and younger, have a household income less than $50,000, live in the West region and in urban areas and currently rent.

Who Are the Homebuyers? The NAR 2017 Home Buyer and Seller Generational Trends study reported that 35% of all homebuyers were first-time buyers, and 66% of them were 36 years of age and younger. Buyers, 37–51, were the second largest group, at 26%. Not surprisingly, 66% of recent buyers were married couples. What was surprising, however, is that the second largest group was single females, at 17%, and the largest group of them was 62 to 70 years of age. Other interesting findings include 11% of homebuyers purchased a multi-generational home, often to care for aging parents, and homebuyers 37–51, were the most racially diverse, with 26% being Hispanic Americans, African Americans or Asian Americans.

Small Real Estate Firms Still Dominate According to the NAR 2016 Profile of Real Estate Firms, their primary characteristics were 78% working from a single office, with three full-time real estate licensees; 83% were independent, non- franchised; and 85% specialized in residential properties. Firms that fit this profile have a median total annual sales volume of approximately $4.5 million and a total of approximately 21 transactions. For all firms, the following sources generated their annual sales volume: past client referrals, 30%; repeat business from past clients, 30%; Website, 10%; social media, 5%; and open houses, 2%.

Market Futures According to Dodge Data & Analytics projections, single-family housing construction will increase 12% during 2017, to a total of $227.10 billion, while the forecast for total single-family housing starts is 1.242 million, compared to 1.176 million during 2016. Mortgage News Daily reported a 30- year, fixed mortgage rate of 4.25%, as of March 30, 2017. The Freddie Mac commitment rate for a fixed- rate mortgage is forecast to be 4.36% for 2017 and 5.09% for 2018. In the NAR’s 2017 Home Survey, most age groups surveyed thought home prices would increase during the next 6 months, and more than 50% among those 34 or younger, 45–54 and 65 and older.

Advertising Strategies What should be a good media combination for real estate firms is 10- or 15-second TV spots that build name awareness and invite viewers to the firm’s Website and ads on your station’s Website that show the photo of a featured listing and/or announce open houses. Real estate firms should consider using various incentives to attract buyer to open houses, such as a gift card for everyone who visits during a specific time period and/or a drawing from the names of all who visit for a substantial prize. Data in the Profiler offer some niche opportunities for realtors, such as specializing in finding a home for single females, 62 to 70 years of age; finding a home for buyers that need a multi-generational home; or having an associate that speaks Spanish.

New Media Strategies Encourage agents to record a weekly video, interviewing buyers, showing how to prepare a home for sale, interviewing a local banker to discuss the mortgage market, a tour of a local community’s amenities, etc. Post these videos on the firm’s Website and social media. Create and distribute a quarterly email campaign to past clients and all current prospects to generate referrals. Offer incentives to maximize participation: drawing for a free home carpet cleaning, family day pass to local amusement park or zoo, etc. Studies show that commercial real estate firms should be able to generate leads using a combination of a blog with posts that include links to whitepapers and/or videos, which are promoted on and linked from the firm’s LinkedIn page.