The income and sales volume of National Association of Realtors® members dropped slightly over the last year, but membership increased as younger members continue to enter the industry, according to the 2018 National Association of Realtors® Member Profile. This past year, there was a rise in new members from 1.22 million in March 2017 to 1.30 million in April 2018. The profile found that 29% of members have less than two years of experience, an increase from 28%. “While inventory shortages continue and home prices remain high, NAR has seen a whopping 6% increase in membership over the last year. Younger Americans are seeking business opportunities that working in real estate provides, but the overall trend is a slightly older age profile,” Lawrence Yun, NAR chief economist stated. The survey’s results are representative of the nation’s 1.3 million Realtors®; members of NAR account for about half of all active real estate licensees in the US Realtors® go beyond state licensing requirements by subscribing to NAR’s Code of Ethics and standards of practice and committing to continuing education. Realtors®’ median age was 54 this year, slightly up from the last two years, at 53. Sixty-three% of Realtors® are female, and the typical Realtor® is a 54-year-old white female who attended college and is a homeowner. The most common first careers reported are in management, business or finance, or in sales and retail, both at 16%. Only five% of Realtors® reported real estate was their first career; 72% said that real estate was their only occupation, and that number jumps to 82% among members with 16 or more years of experience. Sixty-five% of Realtors® are licensed sales agents (same as last year), 21% hold broker licenses (down from 22%), and 15% hold broker associate licenses (same as last year). New members tended to be more diverse than more experienced members; 25% of members with two years of experience or less were minorities, up from 22% last year.
According to the survey, the main factors that limit potential clients in completing transactions are difficulty finding the right property (35%), housing affordability (17%), and difficulty in obtaining mortgage financing (12%). Impacted by low inventory, the typical number of transactions decreased slightly from 12 transactions in 2016 to 11 transactions in 2017. Despite rising home prices again in 2017, the median brokerage sales volume decreased to $1.8 million in 2017 from $1.9 million in 2016. “A familiar story lingers from last year, as limited inventory continues to plague many housing markets across the country. For the fifth year in a row, the difficulty finding the right property has surpassed the difficulty in obtaining a mortgage as the most cited reason limiting potential homebuyers,” said Yun. The typical Realtor® earned 12% of their business from repeat clients and customers (compared to 13% in 2017) and 17% through referral from past clients and customers (compared to 18% in 2017). Realtors®’ web presence and use of social media has increased in recent years as a valuable marketing tool to reach clients and build online communities. Sixty-eight% of members reported having their own website, the same number as last year. Members continue to be more comfortable with using the latest technology on a daily basis as 71% of members were on Facebook for professional use and 59% were on LinkedIn (same as last year). Finally, 80% reported that they are certain they would remain in the real estate business, while those who were newest to the profession were least certain they would remain; 5% of all members were uncertain whether they would remain in the business.
Trump workforce re-training order could create 500K new job opportunities
President Trump signed an executive order at the White House on Thursday aimed at increasing training opportunities for American workers to help close the so-called skills gap. “We’re asking businesses and organizations across the country to sign our new pledge to America’s workers,” Trump said. “Today, 23 companies and associations are pledging to expand apprenticeships … for on-the-job training and vocational education.” The president added that the opportunities will be for Americans of all ages, from college students looking to land their first job to older workers looking to learn skills for a new career. More than 15 companies signed on to the effort, including IBM, Home Depot, Lockheed Martin, FedEx Corp, General Motors and Walmart. FedEx CEO Fred Smith said his company would re-train 500,000 workers, while IBM’s Jen Crozier committed to creating 100,000 new opportunities. As part of the order, top administration officials will form a National Council for the American Worker, which will focus on industries considered to have high potential for workers. Executives and experts from the private sector, educational institutions, and other outside organizations will also be enlisted to form a separate advisory board. Trump said the members of that board will be announced in the coming weeks. The White House said the initiative could lead to 500,000 new job opportunities in the US labor force. Trump said on Thursday that the US economy has created 3.7 million jobs since the election. The skills gap has been a prevalent problem for companies, which have a number of job openings. Lockheed Martin CEO Marilyn Hewson said in an article on Fox News Thursday that a lack of qualified workers in her industry has “a clear, real-world impact.” Hewson pledged to create at least 8,000 new opportunities for workers over the next five years.
NAHB – remodeling confidence increases despite rising costs
The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 58 in the second quarter of 2018, up one point from the previous quarter. The RMI has been consistently above 50—indicating that more remodelers report market activity is higher compared to the prior quarter than report it is lower—since the second quarter of 2013. The overall RMI averages ratings of current remodeling activity with indicators of future remodeling activity. “Remodelers across the country continue to see demand,” said NAHB Remodelers Chair Joanne Theunissen, CGP, CGR, a remodeler from Mt. Pleasant, Mich. “However, the rising cost of materials is impeding the market’s ability to be even stronger.” Current market conditions decreased one point from the first quarter of 2018 to 57. Among its three major components, major additions and alterations waned one point to 55, minor additions and alterations decreased two points to 58, and the home maintenance and repair component rose two points to 59. The future market indicators gained four points from the previous quarter to 59. Calls for bids fell two points to 55, amount of work committed for the next three months increased two points to 56, the backlog of remodeling jobs jumped nine points to 66 and appointments for proposals rose seven points to 61. “Improving economic growth is supporting demand for home remodeling,” said NAHB Chief Economist Robert Dietz. “However, remodelers have to deal with rising material prices, especially lumber, and the continued shortage of labor to keep prices competitive. The labor shortage is also a factor contributing to the increasing backlog of remodeling jobs.”
Lockheed Martin CEO pledges over $100M in workforce training
Lockheed Martin CEO Marillyn Hewson joined President Trump’s pledge to American workers by investing hundreds of millions of dollars in training students and workers to prepare them for the jobs of the future. “We are very excited about the opportunity to participate in this initiative. We think it is the right strategy,” Hewson said during an interview on FOX Business’ “After the Bell” on Thursday. Lockheed Martin is investing $100 million in employee training and educational opportunities over the next five years. In addition, the company has rolled out $50 million to support the STEM Scholarship Fund and $5 million toward apprenticeship and vocational opportunities. “We want to make sure that we’ve got the workers for today as well as for the future,” Hewson said.
ATTOM – Housing Precogs: Predictions Beyond Hunches
Peter G. Miller July 19th, 2018
The following is an excerpt from a white paper published by ATTOM Data Solutions. Real estate used to be a game of hunches. People bought and sold property because they had a sense of pricing, timing, and marketplace trends. Mortgages were made in large measure on the basis of past performance. Today hunches are out, big data is in, and the artificial intelligence revolution is taking the real estate world by storm as the use of predictive analytics comes with the promise of better leads and early access to future inventory — translating into lower costs, less risk and bigger profits for the industry. The drive away from housing market hunches to sophisticated predictive analytics based on big data principles is led by a growing group of housing precogs that are relative newcomers to the industry with strong ties to Silicon Valley and funded largely by venture capital. “We use predictive analytics and machine learning to analyze how likely a homeowner is to sell in the near future,” said Avi Gupta, President and CEO at SmartZip Analytics. “These techniques look at historical data — who has sold in the past — to identify, from several thousand data attributes, which ones may have been a factor in triggering those sales. And then, they look for owners that exhibit similar triggers to predict who is more likely to sell in the future.” Gupta added that “real estate is truly hyper-local, in that, the triggers that matter in a given neighborhood block can be different from the one next door, or even across the street. And these triggers can change from time to time even for the same neighborhood block. Hence, we have had to build hundreds of predictive models that look for various combinations of triggers to find the one that is the most accurate for each neighborhood across the country.”
Back in 1971 — when many MLS brokers carried printed 3×5 cards to show inventory — the playwright Arthur Miller wrote that “too many information handlers seem to measure a man by the number of bits of storage capacity his dossier will occupy.” Now such dossiers are far larger, vast electronic collections which detail our preferences in excruciating detail. Not just a tidbit here and there, but encyclopedic volumes of data ceaselessly gathered with clicks, links, cookies, tracking pixels, surveys, cell phone locators, loyalty programs, credit card purchases, and other collection techniques. Companies, governments, and data brokers are accumulating unheard of volumes of data. Forget about gigabytes, petabytes, and exabytes. We’ve hit zettabytes — a measure equal to one trillion gigabytes. “By 2025 the global datasphere will grow to 163 zettabytes,” says IDC. “That’s ten times the 16.1ZB of data generated in 2016. All this data will unlock unique user experiences and a new world of business opportunities.” While data by itself has some innate value, it becomes exponentially more valuable for predictive analytics when sorted and analyzed with artificial intelligence. “Generally speaking,” explains Alex Villacorta, EVP and chief economist at HouseCanary. “the growth of data across every part of the economy and our personal lives has provided us predictive modelers the ability to better understand how various pieces of a person’s life affect their decision-making. Everything is now on the table, from our social activity to current headline news to the types of products we buy online.” “For a growing number of industries,” says McKinsey & Company, “AI is tilting the playing field – you’ll need to understand how before your competitors do.”
Data is just part of the equation — and a relatively small part at that — when it comes to applying AI principles to predicting future real estate transactions, according to Brad McDaniel Co-Founder and CEO of Likely.AI, Brad McDaniel, Co-Founder and CEO of Likely.AI, a real estate predictive analytics firma company that provides AI-driven leads to the real estate and mortgage industries. “With the most advanced version of AI, called deep learning, which is what we use, only 10% of the final prediction decision is determined by the data itself,” he said. “That is because 90% of the predictive power comes from the extremely complicated interactions between the layers of neurons within the deep neural networks that we have created. We now live in a time where data availability is everywhere, but what you do with it is where the magic happens.”
NAHB supports trump’s workforce development plan; pledges to train 50,000 new workers
Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement in support of the White House executive order on workforce development: “NAHB applauds President Trump’s leadership for signing an executive order that will develop a national strategy to expand job-training and apprenticeship opportunities for students and workers and give them the proper tools to succeed in the American workforce. “Given the chronic labor shortages in the home building industry, I am especially pleased to attend this important White House event. NAHB will help do it part to invest in the future workforce by pledging to train 50,000 new workers over the next five years for a career in the construction trades. The Home Builders Institute, our workforce development arm, is a national leader for career training in the home building industry. To honor the administration’s important commitment to America’s workers, we will expand our training, certification and job placement programs for underserved and at-risk youth, transitioning military, veterans, ex-offenders and displaced workers.”