I was recently asked to provide some answers to the following questions for the RISMedia’s Real Estate Magazine…
1. As we wrap up the fourth quarter of 2011, has this year panned out as you expected it to? Were there any major surprises…good or bad?
This year was definitely a little more challenging than expected with all of the financing changes that occurred as far as the tightening of credit, increase in FHA MI, and continued issues with appraisals but overall we still are having a great year. We opened a fourth office and agents are affiliating with us which is great. Each year, I do my Top 10 predictions for the upcoming year and I hit on some, missed on others. The best miss was I had predicted interest rates would be above 6% and as we all know, I couldn’t have been any further off which is good. For the best hit, I predicted we would see new home sales prices come down and as a result we would see more new home sales and we did – at least in Northern Virginia we did. Toll Brother’s had a record year in South Riding, a community next to our Chantilly office, selling 110 houses in their fiscal year which ended in October. The community where our Ashburn office is located, Brambleton sold 354 houses in 2010; the 8th best-selling community in the country has sold over 500 houses YTD.
2. In your opinion, what will be the most significant drivers of business in 2012 and how are you preparing your company to take advantage of them?
In my opinion, there are a few. Investors will continue to play a huge role in our market. Educating agents on how to work with investors, helping them get involved in property management and learn to market themselves to attract more investors and tenants to ensure success in this arena. On the flip side of investors are first time buyers. As rents increase, with the interest rate environment we are currently in, buying may be a better option for many would be tenants. So having a plan of action to help first time buyers is extremely important. Although interest rates have been at record lows, they have not motivated huge numbers of buyers to enter the market but a sharp increase in rates could be devastating to the housing recovery so keeping rates low is critical and educating the public on the true cost of home ownership is critical. In addition, HAMP 2.0, if successful will help keep in their homes longer, this will help stabilize neighborhoods and prevent further foreclosures plus it will aid in increasing consumer confidence. So being a trusted advisor to our past clients, letting them know about this opportunity is important to growing their business as they are a trusted advisor. We also need to lobby RPAC to keep the Mortgage Interest Deduction as well as prevent the implementation of 20% down payment loans so getting our agents involved in RPAC is a focus next year as well.
3. What are your predictions for consumer confidence in 2012? What issues stand to most significantly impact consumer confidence next year and what strategies will you employ to help restore confidence?
If the press continues to pump out negative information on the economy and housing instead of putting a positive spin on what is happening and jobs are not restored, consumer confidence will stay low. It is critical that agents get the word out about their market as each market is local and even hyper local. Consumer confidence will be a key for us to continue to drive sales locally. Our market in Northern Virginia is unlike any other in the country. Our distressed property inventory is only 18% of our market, as such, foreclosures and short sales are not a driving force, our unemployment rate in Northern Virginia is in the 5% range, and we only have a 2.9 month supply of houses. It is our job to get this information out to our clients and consumers to dispel the negative news they hear virtually daily on the housing market. We need to continue to let them consumers know that if their employment is stable, the house is right for them and their family, interest rates are phenomenal and now is the right time to buy. So education is the key. Blogging, videos, email campaigns and direct mail are how we plan to get the word out to the public.