Crystal Ball for 2009- Texas Real Estate Market Predictions

I really wish I had a crystal ball. While many local real estate and title experts try to predict the future, the future is only one thing for sure and that is uncertain. 2009 is definitely uncertain. We do not know how the government bailout will affect the market. We have no idea how the housing crisis will work out or if the stimulus plan will actually help homeowners facing foreclosure. The fact is, we don't have a crystal ball. I have heard some say that 2009 will be great come March while others are predicting this year to be another tough year with the "low point" being 4th quarter. Here is what the Dallas Morning News is reporting:

HOUSING'S PRICE DECLINE PREDICTIONS
DALLAS (Dallas Morning News) – A new report from Moody’s Economy.com and Fiserve Lending Solutions predicts when Texas home price declines will bottom out and what the peak-to-bottom price drop will look like.
Most major Texas cities went into the home market downturn later than many throughout the country and will level off ahead of the U.S. average, according to the report’s analysts.
Houston has one of the smallest expected home price declines in the country at 0.2 percent. Analysts expect the city’s home price decline to bottom out in third quarter 2009.
Austin’s peak to bottom home price is expected to fall by 1.3 percent, hitting bottom in fourth quarter 2009.
Dallas–Fort Worth’s price decline will come to 1.1 percent and bottom out in third quarter 2009.
The report predicts San Antonio will experience the largest decrease in the state with a 1.6 percent decline, but it will bottom out in first quarter 2010.
The overall U.S. market could see a price drop of 36.2 percent and bottom out in the fourth quarter of this year.

6 Percent is Dead?

Are the days of 6% real estate commissions dead?

Inman is posting an article today about 6 percent brokerages being dead....what do you think?

Here is a portion of the article written by CondoDomain.com founder Anthony Longo

"...the "standardization" and commonality of the 6 percent commission in the industry is dead and 2009 will be the year in which we will see major movement to innovative fee-based business structures."

Here is part on Longo's reasoning:

"As a seller, it is quite possibly a good idea to have your agent tied to a percentage-based commission on the sales price. After all, your agent's compensation is tied to the highest possible price he can negotiate for you. Not bad, actually -- this kind of makes sense.
But looking at it in reverse, as a buyer, the buyer's agent makes LESS commission for negotiating the lowest possible price for you. This is not in line. It doesn't make much sense. Actually, it does not make sense at all."

This makes perfect sense. Why has the industry stuck to the old 6% rule? I think agents like the 6% rule. It simplifies the process- makes it quite easy. I have noticed in the Dallas/ Fort Worth area that many listing agents are adding on a "transaction fee" to their commissions. They are taking the listing at 6% (or in some cases less than 6%) and then charging a $495- $1200 transaction fee. This seems to make more sense to me. Why would an agent spend time and money marketing a listing that is over-priced, never sells and eventually expires? Collecting a transaction fee makes perfect sense when coupled with a less than 6% commission. Maybe this is the direction that real estate is heading in 2009.

What do you think?

Go Green??

THE FUTURE OF GREEN
LAS VEGAS (Real Estate Center) – While “green” may have become little more than a buzzword to some skeptical consumers, some building industry insiders say the vast majority of consumers have embraced the long-term benefits and understand that going green is “the right thing to do.”
At the International Builders Show today, representatives for several home appliance manufacturers were on hand to talk about the future of green as well as their efforts to create products that are more energy efficient.
So what does the future hold?
For Marvin Windows and Doors, it’s all about daylight. Company spokesman Brett Boyum said they are working on products that bring more sun — and the sun’s natural health benefits — into the home.
Energy efficiency gets all the press and attention within political circles, but what about finding more efficient ways to use the world’s water supply?
“In the very near future, water will be a bigger issue than energy is today,” said Omer “Butch” Gaudette.
Guadette, director of trade relations for Whirlpool Corporation, said 97 percent of the world’s water supply is salienated. Two percent of the remaining drinkable water is tied up in polar ice caps, leaving 1 percent for immediate consumption.
To help ensure that 1 percent is used as efficiently as possible, companies such as Whirlpool and Kohler are stepping up their efforts to create more efficient appliances. Among those efforts are waterless urinals and dual-flush toilets.
Does it cost more to be green? Gaudette says no. While some added cost goes into developing energy efficient products, he said consumers will see value in the long run.