Real estate in the US is on uneven ground, especially with actual sales prices showing a marked lower trend than the mortgaged rates. Consistent patterns are showing up as emerging trends in the real estate industry, due to diverse reasons such as variation in mortgage rates, industry assumptions or other basic or unrelated motives.
Declining Value of Property
Dependable reports indicating the graph of real estate prices show that the realty prices that had seen a steady climb of about 2-5 % per year since 1945 have reportedly dropped by almost 39 % per year from 2008.
The Advent of the Buyer Agency
Earlier in the 1990s, “single agency” practice prevailed, where the realty brokers earned their commission mostly from the seller. The popular idea of “buyer agency” that allowed buyers to keep their own brokers to represent them in the transaction, gained momentum.. Records show that this practice made hefty margins for the sellers, when compared with those who did not avail this facility. However, this does not prevent the rights of the buyer to ask the seller’s agent to see the property, but a law passed in the United States (the Agency Disclosure Laws), passes on the benefit of the information so obtained and the details of negotiations, to the seller.
The commissions charged by the brokers, mainly from the sellers, came in for abject criticism. Around 2005, the commissions ranged between 5-7 %, but over a period, the increasing competition had a say in downgrading commissions paid by the sellers to an average level of 5%, subject of course, to the markets in question.
The Changing Trends in Real Estate Marketing
The online Internet system is fast overtaking the old concept of realty advertisements in newspapers and other print media. A large percentage of prospective buyers of real estate, find it more convenient to gather information about the properties through the Internet, from the comforts of their home. Yard signs, open houses and information from real estate brokers, also played a major role in their decision to buy a property.
The October 2007 launch of a website of the Department Of Antitrust Division of the US government sought to educate the real estate owners about the benefits accruing from subjecting to competition. They predicted savings of thousands of Dollars in those states that allow competition. Here the sellers and buyers benefit from the Multiple Listing Service for a petty amount, and the competition forces the agents to offer extensive rebates to secure the deal.