2021 – Page 40

The “Not So New” World

by John Gordon
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To Thrive Post-Pandemic, Build a Community of Willing Partners by John Gordon It seems impossible to engage in any current dialogue that does not turn to some aspect of COVID and the “new world” in which we all live. While there is no denying COVID and the profound impacts it has had on so many lives and businesses, I would like to share some thoughts about the “not so new” world in which we all now live and work. I began my career in the home improvement industry in 1980, starting in the lumber business. At that time, a new product called “wafer board” had hit the market. Any self-respecting and seasoned carpenter and salesperson knew that no product made from chips of wood could ever be a legitimate and structurally-sound building component. Well, how wrong we were. If you don’t know how the story ends, “wafer board” evolved—and today OSB (Oriented Strand Board, if lumber jargon is not your strong suit), is a building staple accepted and respected by all. Much has changed in the last 40 years. I have moved on from selling lumber to managing businesses and launching new markets, new concepts, and new technology. Even our world of real estate investing has undergone significant changes in just 15 years of its 61-year history. While COVID has been an agent of change for us all, there is one constant that underpins survival and success in both the best and worst of market conditions: strong partnerships. Oh, the irony. In a time when COVID has us isolated and socially distant when in public, the need for strong relationships with supplier partners continues to be key to success. Strong Partnerships Building on a foundation of strong partnerships is not just a great sound bite—here is what it looks like in practice. Price and value are table stakes. Value that differentiates is the stuff of strong partnerships. How will my business work to make some element of my customers’ business better? How can we integrate processes and solutions to save time and money? How can we leverage existing capabilities to solve new challenges? I trust that most of you have built strong connections with your partners. I am fortunate to have genuine partners in our industry and in others. As director of national accounts at The Home Depot, one of my responsibilities is supporting very large single-family property investors with product and service solutions. At any given time, my team works with customers who, in aggregate, touch almost half a million single-family homes and their occupants. Think of this. Taking care of the residents who occupy our properties and communities took a serious blow when maintenance techs were not able to get into homes for 30 or 60 days. Thanks to strong partnerships with our suppliers, investors/property managers were able to share “how to” content that walked residents through simple but urgent fixes during those months when technicians could not enter homes. This small act of reciprocity lessened our backlog and made it more manageable until homes could be entered again. Given today’s supply chain and transportation constraints, having a partner with the ability to assemble product in a single place and deliver it as a package when needed is a huge win. We turned many times to our internal business partners to leverage order aggregation and distribution solutions traditionally used in multi-family settings to solve problems for our single-family residence customers and their contractor networks. Similarly, industry partners whose traditional focus was assembly of products for our retail customers came to our rescue when additional capacity was needed. Now, in addition to assembling product for our stores they made property visits to complete pre-defined and routine activities. This was an existing partnership with a whole new spin. Bottom line: While there have been many new challenges and pressures, strong partnerships—both current and new—have proven to be a reliable element of success. The type of partnerships you will need to weather hard times will vary. Identifying and embracing technology partners helps to make most all other partnerships exponentially more effective. Personally, I could do without digital meeting platforms. But given the last year, I was forced to embrace the concept during stay-at-home orders. Using Technology as a Force Multiplier How can home renovation business entities utilize technology to partner together in a way that is mutually beneficial? It is difficult to build from scratch solutions within the tech world’s breakneck pace of innovation. Thankfully, The Home Depot has found ways to share information with existing systems and platforms that marry the best of both partners. Today, the RenoWalk app, launched in the investor marketplace over ten years ago is better than ever. It now accommodates the tracking of change orders, provides before and after pictures and tracks project status updates. RenoWalk has forms that allow for loading information directly to digital project management and procurement platforms. It supports investors and property managers with the ever-debated tenant responsibility and deposit tracking details. To make adoption easier, there are open API’s (data feeds) for integration with existing platforms. Technology is a great enabler and force multiplier. When it is placed in the hands of the innovative and resilient people who run and support daily businesses operations, the outcome is success. The resiliency of the human spirit is not to be ignored or underestimated, especially in difficult times like the past year. Resilient people tend to be innovators when new solutions are needed—resilient employees are to be treasured. An engaged employee committed to taking care of your customer, despite hardships at home, can make or break your business. Your people need to know you will care for them in these difficult times. Taking Care of Your Team What have you done—what are you doing—to take care of your team and to reinforce their trust? How are you improving their lives as your business improves? This will be your most important partnership. Take care of them and they will take care of you

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Lanthorn.ai and Uptimo are partnering up to streamline residential property management Lanthorn.ai, a Video Analytics Company, and Uptimo, a Real Estate Management Company, announced a collaboration agreement to bring AI solutions into property management. Property management is an essential service facilitating the balance in the rental housing market. The goal of this collaboration is to increase operating income, by reducing costs, and by increasing tenant’s satisfaction through enhanced experiences. This collaboration will assess different use cases, such as snow detection outside entrances to ensure tenant safety and the use of occupancy mapping to optimize cleaning and maintenance. “Property management is a legacy business. Speaking to property owners and operators made us realize that ROI is the determining factor for them to consider technology adoption. So, to introduce new technology to property management, the solution must be priced according to the value it brings. Through this collaboration, we are hoping to develop a strong benchmark for the use of ROI positive AI technologies in this old-school industry,” said Reza Khosravi, CEO and Co-Founder of Lanthorn.ai. “Real estate is still the largest portion of wealth in North America. Years of the low-interest-rate environment have made real estate an attractive investment asset both for institutional and retail investors. Meanwhile, the role of property management is becoming more important in optimizing yield on investments while improving the experience of the tenants. At Uptimo, as the name says, we add value through optimization and we believe we can accelerate this process through this partnership. AI empowers us to gain new insight and fuel new business ideas at a reduced cost,” said Marc Antoine Vezina, CEO of Uptimo. About Uptimo Uptimo is a real estate management company based in Sherbrooke, QC that optimizes the yields of income properties by offering quality management. Uptimo’s goal is to increase the value of properties under management. The strength of the company is its multidisciplinary, competent, and passionate team which allows it to offer a variety of services in the real estate industry. Visit www.uptimo.ca About Lanthorn.ai Lanthorn.ai is a video analytics company based in San Francisco, California that relies on existing cameras to provide insights regarding occupancy, safety, and more. The company is dedicating to adding value while ensuring data security and occupant privacy. Lanthorn.ai’s suite of solutions is essential in any organization that hosts people. Visit Lanthorn.ai

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– As vaccines roll out, prices of spacious city dwellings are rising 20% – The pandemic-driven bump in rural properties has peaked – Urban condos are making a comeback with sales up nearly 30% year over year Prices of urban single-family homes are rising nearly 20% year over year—faster than any other type of home—according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. But this year’s hot housing market does not discriminate: Urban condo sales are up nearly 30% year over year, more than any other home type. Key takeaways from Redfin’s analysis, which looks at the housing market divided into five categories (urban single-family homes, suburban single-family homes, rural single-family homes, urban condos, suburban condos) during the 12 weeks ending April 4 include: Prices of urban single-family homes increased nearly 20% year over year, outpacing price growth rates for every other home category, a signal that buyers are searching for spacious homes near city amenities as vaccines roll out. Online listings of homes in large metros saw a 62% year-over-year increase in pageviews, bigger than the increases for homes in small towns and rural areas, another suggestion that buyers are returning to the city. Single-family homes sold faster than condos in all neighborhood types, indicating that buyers are clamoring for relatively large, private homes. Urban condos sales were up nearly 30% year over year, a bigger increase than any other home category, signaling that the condo market is recovering after plummeting last summer. Urban single-family homes are currently seeing the fastest price growth partly because they offer the best of both worlds for many buyers, especially with the end of the pandemic in sight. “Now that Americans have had a year to consider what the pandemic and its aftermath mean for their lifestyles, we’re seeing a lasting preference for single-family homes—but rural and suburban settings are no longer as popular as they were at the start of the pandemic,” said Redfin economist Taylor Marr. “Many homebuyers are still prioritizing features that were desirable at the beginning of the pandemic, like space for a home office or a big backyard, partly because many people plan to continue working from home. But as people venture out of their homes more often, they are rediscovering the advantages of living in a city. People want to continue barbecuing in the backyard, but they also want the option of turning off the grill and walking to their local pizza place.” The median sale price of single-family homes in urban neighborhoods is up 19.4% year over year to $286,000—the biggest increase on record, and a bigger price gain than any other category of home. The fact that prices are growing faster for single-family homes than for condos in all types of neighborhoods indicates that many buyers in the pandemic era have a strong preference for self-contained homes without shared walls. Price growth for rural single-family homes outpaced all other home types from the beginning of the pandemic through the end of 2020, when price growth for urban single-family homes surpassed its rural counterpart. Pageviews of homes in large metros are on the upswing, signaling a return to the city Redfin.com pageviews of homes in metro areas with a population of more than 1 million—which include both urban and suburban neighborhoods—increased 62% year over year in March. That is a bigger increase than the 30% gain for small towns and the 18% increase for rural areas. The fact that homebuyer interest in large metros is accelerating while it is decelerating in rural areas and small towns suggests the pandemic-driven bump in demand for rural properties has peaked and buyers are returning to the city. The year-over-year jump in pageviews for large metros is likely exaggerated because March marks one year since the pandemic hit the U.S. Last March, views of homes in that type of area dropped significantly as cities went under lockdown and buyers turned toward smaller towns. Single-family homes are selling faster than condos Another indicator of the hot single-family housing market is that single-family homes in all neighborhood types are selling faster than condos and selling significantly faster than they were a year ago. The typical suburban single-family home spent 25 days on the market before going under contract during the 12 weeks ending April 4. Urban single-family homes are selling nearly as fast, with a median of 29 days on the market before going under contract. Homes in all categories are selling significantly faster than they were a year ago, led by rural single-family homes, which are selling 32 days faster than last year. The increased speed for rural properties is reflective of the pandemic-driven surge in demand for spacious homes outside city centers: In the beginning of 2020, pre-pandemic, homes in rural areas sat on the market longer because fewer buyers were interested in living in far-flung areas with long commutes to the office. Condos are picking up in popularity from a pandemic-driven plunge, even with the outsized popularity of single-family homes Condo sales are picking up more than sales of single-family homes. The number of urban condos sold was up 29.9% year over year during the 12 weeks ending April 4, the biggest gain on record and a bigger increase than any other home category. It is followed by suburban condos (22.8%). The uptick in condo sales is a sign that the condo market is recovering after plummeting with the onset of the pandemic. During the 12 weeks ending June 29, 2020, sales of urban condos reached a record low, down 44.9% year over year. Sales of suburban condos dipped nearly as much, dropping 42.3%. To view the full report, including charts and methodology, please visit: https://www.redfin.com/news/urban-single-family-homes-price-growth/ About Redfin Redfin (www.redfin.com) is a technology-powered real estate broker, instant home-buyer (iBuyer), lender, title insurer, and renovations company. We sell homes for more money and charge half the fee. We also run the country’s #1 real-estate brokerage site. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a

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The JV will acquire, renovate, and manage single-family rental (SFR) homes, marking DivcoWest’s entrance into the SFR investment market Atlas Real Estate, a full-service real estate company specializing in investment brokerage, property management and institutional acquisition, announced that it has entered into a joint venture (JV) partnership with San Francisco-based DivcoWest to invest $250 million of equity in single-family homes as rentals throughout the Western United States. The JV expects to deploy $1 billion acquiring and renovating homes in high-growth states, including Colorado, Arizona, Idaho, Nevada, and Utah, where Atlas currently manages more than 4,200 units. “DivcoWest’s partnership with Atlas is a testament to our decade plus history as an acquisition partner and the long-standing relationships we have cultivated with institutional investors since our inception,” explains Ryan Boykin, co-founder of Atlas Real Estate. “The start of this new joint venture also points to the strength of the SFR housing sector and to the full-service real estate investment platform Atlas has created.” “The new partnership between Atlas and DivcoWest enables us to live up to our mission as a company: ‘To Uplift Humanity Through Real Estate,’” says Tony Julianelle, CEO of Atlas Real Estate. “The joint venture will function to increase the inventory of single-family rentals in Atlas-managed markets, presenting a tangible opportunity to serve people and create a positive resident experience while helping meet the supply demands by providing high quality housing.” Since its inception in 2013, Atlas Real Estate has been recognized as a leader in the real estate industry. The Denver Business Journal named Atlas as a Fast 50 Honoree, Bank of America selected Atlas as one of its Colorado Companies to Watch, and ColoradoBiz Magazine has honored the firm with the Best of Colorado: Property Management award for the past four consecutive years. About Atlas Real EstateAtlas Real Estate is a full-service real estate company specializing in investment services, property management and institutional acquisitions. A buy/sell brokerage, Atlas is also a Zillow Offers Partner Agent. Since its inception in 2013, Denver-based Atlas Real Estate has made a commitment to Uplift Humanity Through Real Estate. With offices in eight markets nationwide, Atlas transacts over $1 billion in real estate annually and manages more than 4,200 residential units. Atlas has been recognized by leading media outlets as a one of the Best Places to Work in Denver, the Best Property Management Company, and a Top Company in Real Estate. To learn more about Atlas, visit www.realatlas.com. About DivcoWestFounded in 1993, DivcoWest is a vertically integrated, real estate investment firm headquartered in San Francisco, with offices in Los Angeles, Menlo Park, Boston, Washington DC and New York City. Known for long-standing relationships and experience across the risk-spectrum in markets where innovation thrives, DivcoWest combines entrepreneurial spirit with an institutional approach to deliver real estate solutions and opportunities to the world’s most forward-thinking companies and investors. DivcoWest aims to create environments that inspire ingenuity, promote growth, and enhance health and well-being. Since inception, DivcoWest and its predecessor have acquired approximately 48 million square feet of commercial space – primarily throughout the United States. DivcoWest’s real estate portfolio currently includes existing and development properties in the office, R&D, lab, industrial, retail, and multifamily spaces. www.divcowest.com

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Texas Realtors releases 2021-Q1 edition of the Texas Quarterly Housing Report The median sales price of homes in Texas reached $274,300 in the first quarter this year, an increase of 13.4% over the same period last year, according to the 2021-Q1 Texas Quarterly Housing Report released today by Texas Realtors. “The demand for housing in Texas remained strong despite the winter storm in February and the pandemic,” said Marvin Jolly, chairman of Texas Realtors. “With a low supply of homes for sale, though, prices in most areas have gone up significantly, and competition among buyers has increased as well.” During the first quarter of this year, 84,464 homes were sold in Texas, jumping 10.1% compared to the first quarter of 2020. One-third of homes sold were in the $200,000-$299,000 price range, the largest percentage of any price range. Luis Torres, Ph.D., research economist with the Texas Real Estate Research Center at Texas A&M University, commented, “Depleted inventory is the greatest challenge to Texas’ housing market, pushing up prices at elevated rates as demand remains strong, making it one of the most competitive housing markets for homebuyers since the 2006-07 housing boom. Rising mortgage rates in 2021 combined with recent rapid price growth will slow demand and, consequently, price growth to more sustainable levels.” Active listings declined 53% from last year and stood at 43,542 homes for sale at the end of the first quarter of 2021. Homes spent an average of 47 days on the market before going under contract, which is 20 days less than the first quarter of 2020. The average total time from hitting the market until the sale closed was 87 days, down 13 days from the previous year. Housing supply in Texas decreased from 3 months in the first quarter of 2020 to 1.3 months of inventory in the first quarter this year. Chairman Jolly concluded, “Many homes are attracting multiple offers and selling for thousands above asking price. Price plays a key role in winning offers, of course, but other considerations can come into play as well. Realtors have been helping their buyers and sellers sort through their options to help them achieve their real estate goals during a market that presents some unique challenges.” About the Texas Quarterly Housing ReportData for the Texas Quarterly Housing Report is provided by the Data Relevance Project, a partnership among local REALTOR® associations and their MLSs, and Texas REALTORS®, with analysis by the Texas Real Estate Research Center at Texas A&M University. The report provides quarterly real estate sales data for Texas and 25 metropolitan statistical areas in Texas. To view the report in its entirety, visit texasrealestate.com About Texas REALTORS®With more than 140,000 members, Texas REALTORS® is a professional membership organization that represents all aspects of real estate in Texas. We are the advocates for REALTORS® and private property rights in Texas. Visit texasrealestate.com to learn more.

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Homes sell at their fastest pace on record with nearly half off-market within one week The median home-sale price increased 18% year over year to $344,625—an all-time high—according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Below are other key housing market takeaways for more than 400 U.S. metro areas during the 4-week period ending April 18. Note that at this time last year, pandemic stay-at-home orders halted homebuying and selling, which makes year-over-year comparisons unreliable for select housing metrics. As such, Redfin has broken this analysis into two sections: metrics that are acceptable to compare to the same period in 2020, and metrics for which it makes more sense to compare to the same period in 2019. Metrics to compare to 2020: Asking prices reached an all-time high of $356,175. Homes that sold during the period were on the market for a median of 21 days, the shortest time on market since 2012. This was 16 days fewer than the same period in 2020. 45% of homes sold for more than their list price, an all-time high. This was 18 percentage points higher than the same period a year earlier. The average sale-to-list price ratio, which measures how close homes are selling to their asking prices, increased 2.3 percentage points year over year to an all-time high of 101.0%, meaning the average home sold for 1% more than its asking price. 58% of homes that went under contract had an accepted offer within the first two weeks on the market. This was a new all-time high (Redfin’s data for this measure goes back to 2012). 46% of homes that went under contract had an accepted offer within one week of hitting the market, an all-time high. Metrics to compare to 2019: Pending home sales were up 23% from the same period in 2019. New listings of homes for sale were down 10% from the same period in 2019. Active listings (the number of homes listed for sale at any point during the period) fell 47% from the same period in 2019 to a new all-time low. Mortgage purchase applications increased 6% week over week (seasonally adjusted). For the week ending April 22, 30-year mortgage rates fell to 2.97%, the lowest level since the week ending February 25. “There has been an ongoing debate at Redfin about whether fear of coronavirus infection was keeping homeowners from selling. With a third of American adults now fully vaccinated and still hardly any homes being listed for sale, we’re close to settling that debate,” said Redfin Chief Economist Daryl Fairweather. “Homeowners are staying put because if they move and buy another home they will face a very competitive housing market as buyers, and they don’t need to sell to take advantage of record low mortgage rates. They can just refinance their current home. On top of that, builders are struggling to construct new homes given an ongoing lumber shortage. Without more homeowners listing, buyers are scrambling to compete for the limited number of homes on the market, which continues to drive prices up to new heights.” To view the full report, including charts and methodology, please visit: https://www.redfin.com/news/housing-market-update-home-prices-up-18-pct/ About RedfinRedfin (www.redfin.com) is a technology-powered real estate broker, instant home-buyer (iBuyer), lender, title insurer, and renovations company. We sell homes for more money and charge half the fee. We also run the country’s #1 real-estate brokerage site. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can take an instant cash offer from Redfin or have our renovations crew fix up their home to sell for top dollar. Since launching in 2006, we’ve saved customers nearly $1 billion in commissions. We serve more than 95 markets across the U.S. and Canada and employ over 4,100 people. For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin’s press release distribution list, email press@redfin.com. To view Redfin’s press center, click here.