Smart Home Technology Is the Smart Way to Sell

Smart Home Technology Is the Smart Way to Sell

RECBL - Real Estate News

Potential homebuyers are looking to buy smart, even if they have to pay more to do it.

Buying "smart" means purchasing a home with pre-installed smart home technology; a trend which is reinvigorating real estate.

Smart technology refers to devices that are connected to the internet and can be controlled and monitored from any location via your smartphone, tablet or computer.

From single mothers to married couples entering retirement, owners of smart homes spend less time and energy managing their homes and more of their valuable resources on career goals, personal relationships, daily tasks and hobbies. Studies predict that smart homes will be the norm by 2020, and real estate agents need to be well-versed.

According to a recent survey, the four main categories of smart products that are important to homebuyers are security (e.g., locks and alarm systems); temperature (e.g., thermostats and fans); lighting (e.g., light bulbs and lighting systems); and safety (e.g., fire/carbon monoxide detectors and nightlights).

Homebuyers across the board are most attracted to smart security and temperature. According to the report, Americans prefer security and temperature over smart appliances and entertainment. Older generations are more likely to have these types of smart home technology: 40 percent of homeowners over 65 years of age have smart temperature products, compared to 25 percent of millennials.

Potential homebuyers of all ages and genders are interested in smart home technology. In fact, 45 percent of Americans either have smart home devices or plan to incorporate them. Of respondents who said they have smart products in their homes, 43 percent are millennials, 33 percent are between 33 and 54 years of age, and 24 percent are 55 and older. Of these, 57 percent are male and 43 percent are female.

Agents looking to work with smart homes need to pay close attention to women homebuyers, a fast-growing segment. Smart home technology may be a valuable resource for increasing women’s homeownership, as single women-especially those with families-will be attracted to owning a home that makes their lives easier and makes them feel safe.

Not only are smart homes safer, but they also have high value. Homebuyers and sellers are willing to pay more for homes with smart technology. Fifty-four percent of homeowners said they would install smart home products if doing so would ensure they could sell their homes faster. Of these, 65 percent said they would pay $1,500 or more. For millennials, this number increases to 72 percent.

Real estate agents can utilize this information in selling homes at a faster rate and higher price to potential homebuyers who understand the value of smart homes. Make sure the homes you sell are equipped with eye-catching smart technology, and communicate to potential buyers the increased value these devices bring to their home and the safety they bring to their families.

DesirEe Patno is president and CEO of the National Association of Women in Real Estate Businesses (NAWRB).

For more information, please visit www.nawrb.com.

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The Yin and Yang of the Millennial Market

The Yin and Yang of the Millennial Market

In a recent release from apartmentlist.com, it’s very interesting to learn while millennials are starting to buy homes, there are not enough homes in their price range on the market - and even if there were, many could not come up with a down payment.

In his latest Apartmentlist Rentonomics report, Andrew Woo writes that during the Great Recession, investors bought countless foreclosed properties, most of which were starter homes.

And rather than selling when prices recovered, investors turned them into profitable single-family rentals. And as a result, Woo says there are very few existing starter homes on the market.

Woo points to Megan McGrath of MKM Partners, who says the housing recovery was primarily at the middle end of the market which drove up home prices and land prices followed. With higher land prices, it is harder for home builders to make a good profit at lower home prices.

During the housing recovery, the price spread between new and existing homes increased because builders were focused on the move-up buyer. But Woo says now middle-end sales are starting to slow down, and builders need to target new buyers to sustain growth.

He says big builders are starting to introduce new product lines at lower price points, and these starter homes are selling well. But the only way for builders to lower prices and take a hit to their margins is if they see big growth in new orders, and he is not seeing that happening anytime soon.

Woo says the demand is clearly growing but is not as strong as demographics would suggest. Single-family construction still stands at 18% below its 25-year average, and he warns about a developing affordability gap.

Aparetmentlist.com recently surveyed 24,000 millennial renters and found that 80 percent want to purchase a home, but face a huge obstacle in affording one. Woo says its because millennials vastly underestimate the savings needed for a down payment.

Woo fears based on current saving rates most millennials will need at least a decade to save enough - and that a lack of savings, combined with the shortage of affordable starter homes, will leave a large share of millennials renting for years to come.





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10 Cities With Climbing Costs of Living

10 Cities With Climbing Costs of Living

One major determining factor in deciding where to buy or rent a home is cost of living. A recently released study by GOBankingRates.com ranks the cities with costs of living that climbed the most in 2016-a sign of a housing market heating up.

Researchers based the ranking on the increase in the "cost of living index," which includes food, rent and transportation, and the increase in income needed to "live comfortably." The ranking includes cities where both the cost of living index increased and the income needed increased.

The top ten cities:

1. Nashville, Tennessee
 Cost of Living Index Increase: 8.61 points
 Income Needed Increase: $9,135

2. Seattle, Washington
 Cost of Living Index Increase: 7.32 points
 Income Needed Increase: $3,190

3. Louisville, Kentucky
 Cost of Living Index Increase: 4.49 points
 Income Needed Increase: $2,066

4. Austin, Texas
 Cost of Living Index Increase: 3.84 points
 Income Needed Increase: $1,407

5. Jacksonville, Florida
 Cost of Living Index Increase: 3.36 points
 Income Needed Increase: $2,095

6. Los Angeles, California

Cost of Living Index Increase: 2.89 points

Live Comfortably Amount Increase: $1,676

7. Philadelphia, Pennsylvania

Cost of Living Index Increase: 2.78 points

Live Comfortably Amount Increase: $2,590

8. Virginia Beach, Virginia

Cost of Living Index Increase: 2.65 points

Live Comfortably Amount Increase: $1,720

9. Indianapolis, Indiana

Cost of Living Index Increase: 2.58 points

Live Comfortably Amount Increase: $1,111

10. New Orleans, Louisiana

Cost of Living Index Increase: 2.15 points

Live Comfortably Amount Increase: $1,221

Source: GoBankingRates.com

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Home Equity Major Retirement Asset for Most

Home Equity Major Retirement Asset for Most

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One of the most significant advantages of owning a home is the ability to build wealth-and according to a recent report from the Employee Benefit Research Institute (EBRI), home equity is one of the top two assets households rely on in retirement, barring pension or Social Security benefits.

The report, "Importance of Individual Account Retirement Plans and Home Equity in Family Total Wealth," compared assets in households headed by those between the ages of 25 and 64, computing the share of assets comprised of home equity and retirement plans (e.g., 401(k), IRA)-the other key source of income in retirement.

The median share was 78.2 percent, and even higher when focused in on the 55-64 age range: 87.4 percent.  "The data show that it is overwhelmingly the case that individual account (IA) retirement plan assets, plus home equity, represent almost all of what families have to use for retirement expenses outside of Social Security and traditional pensions," said Craig Copeland, author of the report and senior research associate at EBRI, in a release.

Markedly, the presence of an IA can be an indicator of a households assets overall. More than three-quarters (79.6 percent) of households without an IA have less than $10,000 in assets, according to the report, suggesting some link between having an IA and owning a home.

"Those families without IA assets typically have very low overall assets, so they have almost nothing to draw from for retirement expenses (outside of Social Security)," Copeland said.

Source: Employee Benefit Research Institute (EBRI)

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Housing Ablaze With Activity, Even as California Cools

Housing Ablaze With Activity, Even as California Cools

Cash Buyers List News

​Housing continues to be ablaze with activity, with off-the-charts prices and supply consumed at rapid-fire pace, according to the latest data preview from realtor.com(R). 

Prices in May were 10 percent higher than those one year ago, with the national median at $275,000 and the national median age of inventory at 60 days-five days, or 8 percent, faster than one year ago. Inventory, though higher in May than in April, will still be down 11 percent.

​"Last month there were more prospective buyers, and homes are selling more quickly than during any other May since the recession," says Javier Vivas, manager of Economic Research at realtor.com.

"For the first time, one in three homes nationwide are selling in under 30 days. The lack of affordable homes for sale remains a critical issue, particularly for a growing number of first-time homebuyers and millennials, who are lining up for starter homes but can’t break in."

Red hot California again ruled realtor.coms Hotness Index for May, though some markets are showing signs of fizzling-clearing a path, according to Vivas, for simmering markets, such as Boston, Mass., and Midland, Texas, to heat up. The markets topping the Index have more views per listing on realtor.com compared to the national average-sometimes three times more-and supply moving as much as 36 days faster than the national average.

"This is officially the most competitive, fastest-moving spring housing market in decades," Vivas says. "Some places like the Bay Area have become too hot to handle-and now a lack of inventory and affordability are allowing other markets to catch up."

The top 10 in the Hotness Index:

1.  Vallejo-Fairfield, Calif.
 Median Age of Inventory: 28 days

2. San Francisco-Oakland-Hayward, Calf.
 Median Age of Inventory: 24 days

3. Boston-Cambridge-Newton, Mass.-N.H.
 Median Age of Inventory: 33 days

4. Sacramento-Roseville-Arden-Arcade, Calif.
 Median Age of Inventory: 33 days

5. Kennewick-Richland, Wash.
 Median Age of Inventory: 34 days

6. Colorado Springs, Colo.
 Median Age of Inventory: 32 days

7. Columbus, Ohio
 Median Age of Inventory: 36 days

8. Midland, Texas
 Median Age of Inventory: 34 days

9. San Jose-Sunnyvale-Santa Clara, Calif.
 Median Age of Inventory: 24 days

10. Stockton-Lodi, Calif.
 Median Age of Inventory: 36 days

For more information, please visit www.realtor.com.

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WHAT'S BEHIND THE GATES? HIGHER-PRICED HOMES

Homeowners behind gates can expect an average $30,000 more for their home come sale-a premium, however, that can be offset by costly community amenities, according to research from the American Real Estate Society (ARES). The premium is due to actual and perceived benefits, such as privacy and safety, on the part of the buyer.

"This [research] provides clear evidence that homes in gated communities sell at a premium relative to comparable homes in non-gated communities," said ARES Publication Director Ken Johnson in a release. Johnson is a real estate economist at Florida Atlantic Universitys College of Business.

The premium may be less in gated communities where amenities like a clubhouse, pool or tennis court drive up maintenance costs for residents, ARES researchers found. Examining a sample of gated communities, researchers discovered a $19,500 decrease in sale price in communities with these types of amenities.

"Additional maintenance costs associated with these amenities often outweigh their benefits, and it appears that while a gate has value, additional neighborhood amenities do not always provide additional value," explained Mark A. Sunderman, one of the ARES researchers.

"From the perspective of both the buyer and the seller, this information should help each to better price property," Sunderman continued. "A good understanding of what adds value and what does not should help create increased marketability of gated homes."

"The long-held belief that gates add value is supported by the data, as long as the impact of the amenities is properly factored in," Johnson added. "This should set buyers minds to rest as to whether or not they are actually receiving a boost in value when they purchase inside a gated community."

Source: Florida Atlantic University (FAU)

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LIVING COMFORTABLY IN THESE CITIES WILL COST YOU

Hankering to wing off to Worcester, or relocate to Rochester? Wherever you're considering moving, it's important to know whether your income can sustain a "comfortable" life there.

Finder.com recently crunched the numbers to determine just that in close to 80 cities around the country.

Among the key findings of Finder.com's analysis-and shocking no one-is San Francisco, Calif. at No. 1, requiring the highest salary of all the cities analyzed, and Los Angeles, San Diego and San Jose in the top 10. In these cities, the salary required to obtain a mortgage for the average home is higher than the salary required for mortgage payments, average debt and average expenditures.

The salary needed to live comfortably in San Francisco, according to the analysis, is $180,600-the average home in the Golden Gate City costs $1,119,500. In Los Angeles, the salary needed to live comfortably is $90,244; in San Jose, $129,864.

The city with the lowest salary requirement is Jackson, Miss., where residents can live comfortably for $43,265.

The U.S. Census Bureau reports the average salary was $52,250 in 2013. In the Finder.com analysis, this figure is sufficient income to live in 36 of the 78 cities analyzed.

For its analysis, Finder.com defined living "comfortably" as:

 - Having the ability to purchase an average home (with a 20 percent down payment);
 - Having the ability to cover average per-person expenditures; and
 - Having the ability to pay off annual non-mortgage related household debt.

Using those controls, Finder.com analyzed factors such as the state's median home price, average interest rate for a 30-year, 20-percent-down mortgage, and average non-housing expenditure.

To learn income requirements for a comfortable life in your desired city, visit Finder.com.

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