MReport September 2019

TheMReport — News and strategies for the evolving mortgage marketplace.

Issue link:

Contents of this Issue


Page 57 of 67

56 | TH E M R EP O RT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA A Better Alternative? Traditional methods to sell a home are changing with one real-estate brokerage giant offering a tech-savvy innovation. R ecently, Zillow announced that Portland, Oregon, became the 12th market where it can now directly buy homes, giving homeowners a new way to sell their properties. "Sellers across the country have shown that they are looking for an easier, less stressful way to sell their home," said Jeremy Wacksman, Brand President at Zillow. "We're excited to launch our first market in the Pacific Northwest today, giving poten- tial home sellers in Portland and Vancouver the certainty and trans- parency they want when selling their home. Zillow Offers provides a seamless transaction experi- ence, helping sellers move on to the next step in their life." The markets of Vancouver, British Columbia, and Washington can also use this new feature to request a cash offer from Zillow. Zillow stated that selling a home is one of the most stressful experiences, and a recent survey from Zillow found more than a third of home sellers said the process "left them in tears." Zillow Offers was first launched in Phoenix last April, and is currently available in Las Vegas, Nevada; Atlanta, Georgia; Denver, Colorado; Charlotte, North Carolina; Raleigh, North Carolina; Houston, Texas; Riverside, California; Dallas, Texas; Minneapolis, Minnesota; and Orlando, Florida. Zillow also has plans to expand this service to additional markets by the end of Q1 2020, bringing the total number of planned Zillow Offers markets to at least 20. The company works with lo- cal agents and brokers on every transaction and pays a commis- sion to local real estate agents when it buys and sells a home. A Portland broker will represent Zillow in each transaction. According to Zillow, more than 100,000 homeowners across the na- tion as of May 2019 have requested a cash offer to buy their house. And the selling market maybe now, ac- cording to a report by the National Association of Realtors (NAR) that stated 46% of Americans in Q2 2019 believe now is the time to sell. Optimism in selling in- creased from 37% in Q1 2019, and Lawrence Yun, Chief Economist, NAR said moderate increases in home prices are a contributing factor. "With home price ap- preciation slowing, home sellers understand that the days of large price gains from holding an extra year are over," he said. The Effect of Trade Wars Recent reports point to the reasons why foreign investors are pulling out of the U.S. housing market. A sluggish U.S. housing market and tighter currency controls by the Chinese govern- ment caused the dollar volume of homes purchased by foreign buyers from April 2018 to March 2019 to drop 36%, according to a report by CNBC. The information, released by the National Association of Realtors (NAR), added that the decline was due to a drop in the volume and average price of pur- chases. Foreigners bought 183,000 properties valued at $77.9 billion, which is down from 266,800 properties valued at $121 billion in the prior year. According to CNBC, foreigners paid an average price of $286,600 for properties, and while higher than the median for all existing homebuyers ($259,600), it is down from the average of $290,400 the previous year. "A confluence of many factors— slower economic growth abroad, tighter capital controls in China, a stronger U.S. dollar and a low inventory of homes for sale—con- tributed to the pullback of foreign buyers," said Lawrence Yun, Chief Economist, NAR. "However, the magnitude of the decline is quite striking, implying less confidence in owning a property in the U.S." The Chinese were the leading buyers for the seventh consecu- tive year, buying an estimated $13.4 billion in residential property, which is a 56% decline from the previous year. The recent political climate may also be causing the Chinese to pull back on U.S. real estate, with real estate agents in California reporting less demand from prospective Chinese buyers. "We call it the Trump effect. It's a combination of anti-Chinese political rhetoric, a clampdown on visa processing, and of course tariffs," Carrie Law, CEO and Director of, said in a recent interview with CNBC. "The Trump effect is undercutting some of the primary drivers of Chinese demand for U.S. prop- erty, including buying homes for students who are studying in the U.S. and the country's reputation as a safe investment." Canadians purchased $8 billion worth of profit and were followed by Asian Indian ($6.9 billion), United Kingdom buyers ($3.8 billion), and Mexican buyers ($2.3 million). "Sellers across the country have shown that they are looking for an easier, less stressful way to sell their home." —Jeremy Wacksman, Brand President at Zillow.

Articles in this issue

Links on this page

Archives of this issue

view archives of TheMReport - MReport September 2019