Nationally Recognized Real Estate Expert Forecasts "Sharp Contraction" in Real Estate Market
|October 15, 2004|
(PRWEB) -- Dr. Edwards, a nationally recognized expert on the real estate industry and consultant to some of the largest real estate brokerage firms, title companies and mortgage lenders in the nation, pointed out that the "contraction in home sales" will occur as interest rates rise and current "homeowners won"t want to give up their low rate non-assumable mortgages."
He said that "Major realty firms and homebuilders will use this period to dramatically improve market share taking advantage of failed competitors and making acquisitions. Realty firms will push for improved mortgage lending services, title, and homeowners insurance to offset their realty brokerage losses. And, many marginal agents will leave the business which may result in a slowing of the current commission erosion."
Presenting at the opening general session of the RESPRO's Annual Fall Seminar, Dr. Edwards discussed his year-long, landmark study on the consolidation of the real estate industry in which 220 of the nations top real estate brokerage firms, 51 of the nation"s top 150 builders and 3,000 recent homebuyers were interviewed on the concept of "one-stop real estate shopping."
Dr. Edwards sees clearly a changing dynamic in the industry in which "successful one-stop shopping," that is the consolidation of real estate brokerage, title services and homeowner and other personal insurance services, "will determine the winners in the industry."
His statement is supported by the year-long study he recently completed. The study shows that 35 percent of recent homebuyers are "highly likely" to use one-stop shopping and nearly 50 percent would use a realty agent to manage the entire process.
Dr. Edwards told the RESPRO attendees that clearly "one-stop shopping is the homebuyers" preference and is growing rapidly."
He noted that with this strong preference on the part of homebuyers, the nation"s leading homebuilders are seeing mortgage capture of up to 90 percent, up to 100 percent of title insurance capture and up to 50 percent of homeowner insurance capture; all of which add considerable value to the bottom line in the sale of a new home.
Among Dr. Edwards other findings in his breakthrough study: - 35 percent of recent homebuyers said the mortgage process took too long; 32 percent said it comprised too much paperwork - Homebuyers under 34 years old were the least satisfied with the purchase process in terms of service - Homebuilders focus on minorities and therefore minorities are buying new homes at twice the frequency rate of whites - The Internet has a significant impact on the real estate industry as 90 percent of agents report that it has made them more productive and 70 percent of homebuyers use the Internet extensively before even meeting a real estate agent.