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May 27th, 2007 11:37 AM by Ron Mastrodonato

NAR survey: Realtors invest heavily in technology

WASHINGTON – May 14, 2007 – A new survey by the National Association of Realtors® (NAR) finds that technology continues to be an integral part of members’ businesses. More than half of the sales agents, associate brokers and managers said they spent more than $1,000 in 2006 on technology products.

The 2007 Realtor Technology Survey, conducted by NAR’s Center for Realtor Technology, also found that 25 percent of respondents spent more than $2,000 on technology in 2006. In addition, approximately two-thirds of those surveyed have a real estate business Web site, and a quarter spends more than $1,000 annually to maintain their site. Nearly all of these sites – 93 percent – provide listing search capabilities. Other than their own Web site, the most popular sites for Realtors to display their listings include the local MLS, their broker’s Web site and Realtor.com.

“Realtors have invested a lot of time and millions of dollars in building and improving real estate technology, and the demand for additional technology is high,” says Mark Lesswing, NAR senior vice president and chief technology officer. “While eight in 10 Realtors think the current technology supplied by their broker is valuable, two-thirds would like their broker to expand the amount of technology offered. Eighty-four percent of those surveyed were also interested in augmenting the technology and services offered by their Multiple Listing Service.”

One of those services is the Comparative Market Analysis (CMA), which compares a home to similar properties that have sold in an area. Ninety-four percent of those surveyed include a CMA as part of their listing presentations, and most Realtors are satisfied with the program. However, 35 percent thought the program could be improved by offering the ability to personalize designs and making it easier to use.

The most popular devices Realtors use in their day-to-day business include digital cameras, desktop computers and cell phones. The survey also revealed the growing popularity of smart phones or PDAs, which provide phone, Internet and e-mail capabilities. In 2005, only 8 percent of respondents used a smart phone compared to 28 percent in 2006, and as many as 30 percent of respondents plan to purchase or replace one in the coming year.

Realtors’ use of automated forms and transaction management software is also on the rise as real estate transactions become more complex. In fact, more than three-fourths of Realtors surveyed said they must manage as many as 20 documents to complete a real estate transaction. Fifty-nine percent of those surveyed use an automated forms management program to help streamline the paperwork involved in a transaction. Twenty-three percent of respondents use a transaction management system, which tracks each step of the real estate process, and 69 percent of those who aren’t currently using a transaction management system are interested in adopting the technology.

“By integrating and adopting innovative systems and processes, Realtors continue to advance real estate technology, improving communication with home buyers and sellers and streamlining transactions,” says NAR President Pat V. Combs. “However, real estate is still a high-touch business. Building strong, personal relationships with home buyers and sellers and understanding their unique needs, is essential to helping them find the home of their dreams.”

Indeed, survey respondents cite referrals and repeat business as the top sources for generating the greatest number of leads. One-third of respondents said that more than half of their business comes from referral clients, which makes staying in touch with current and past clients crucial to a Realtor’s success. The most popular way to maintain relationships with current clients is through phone calls (48 percent) and e-mail (39 percent).

Two-thirds of Realtors continue to communicate with their former clients at least once or more every quarter. The methods, however, have changed. Electronic newsletters have gained in popularity as a way to stay in touch with former clients; other favored methods are mailings and market updates. By comparison, the telephone has fallen out of favor; in 2005, one of every three Realtors picked up the phone to reach out to former clients, but less than 1 percent of Realtors in the current survey relied on phone calls to stay in touch with their past client base.

The 2007 Realtor Technology Survey was based on data from field research conducted from February 28 to March 14 of this year. CRT e-mailed the survey to 21,869 NAR members, including Realtor brokers and agents, and generated 468 usable responses. The survey is available for free download at www.realtor.org/crt.

© 2007 FLORIDA ASSOCIATION OF REALTORS®

Citizens growth called risky: All Floridians could pay if major storm hits

TALLAHASSEE, Fla. – May 14, 2007 – When Citizens Property Insurance Corp. started in 2002, the idea was the state-backed company would eventually shrink, insuring only those who absolutely couldn’t find homeowner coverage anywhere else.

What a difference a new governor makes.

With Florida’s homeowners facing crippling property insurance premium increases and more private insurers dropping policies or pulling out of the state, Gov. Charlie Crist began his term in January vowing to fix the insurance crisis. His philosophy: let Citizens, the state’s insurer of last resort, compete with big private insurers.

Citizens already was the state’s largest home insurer, with 1.2 million-plus policies surpassing State Farm Florida Insurance Co. last year. But Crist and the Florida Legislature have raised Citizens’ stake in Florida’s insurance market.

And that’s a problem, according to a growing chorus that includes state Chief Financial Officer Alex Sink. The worry: All Floridians could be on the hook for an expanded Citizens.

The turnabout in Citizens’ mission “has been stunning, in a word,” Sink said.

After Crist signs legislation passed on May 4 at the close of the legislative session, Floridians can opt for a Citizens policy if their private company’s rates are at least 15 percent higher than what Citizens charges. Citizens will now offer full property coverage, including fire, theft and liability insurance to coastal residents – east of Interstate 95 in most of South Florida and east of Alternate A1A in northern Palm Beach County – rather than just covering homes for costly hurricane damage. And the incentive: Citizens’ customers will have their rates frozen at December 2006 levels until January 2009.

“I saw an insurance lobbyist say that this would be a catastrophe. Well, I’ve got news for them. We’re in a catastrophe now,” Crist told reporters last week. “Ask any family in Florida if they are happy about what they’ve had to pay in insurance. We’re already in a crisis, for crying out loud. The obligation was to try to change that, to turn that ship around.”

The concern of Sink and other critics is what happens if a major hurricane hits and drains Citizens. That could force all Floridians to pay extra charges on their property and automobile insurance policies to cover the state company’s shortfall.

Floridians already are paying extra charges on their property insurance policies to bail out the company’s 2004 and 2005 deficits – $516 million and $1.7 billion, respectively. If Citizens isn’t charging homeowners enough for coverage, that means there’s a bigger chance residents statewide will have to dig into their pockets, Sink said.

“At the end of the day Floridians are going to be paying, not private insurance companies,” Sink said. “That’s to me the scary thing about an environment in which Citizens has so much big market share.”

Members of the House of Representatives spent part of the last day of the two-month annual session debating whether those who aren’t insured by Citizens should have to bear the nonprofit company’s burden if it runs out of money.

State Rep. Don Brown, the House Insurance Committee chairman, said people can live wherever they like in the state, but “they simply do not have a right to expect that everyone else would fund their choices.”

“You’re picking the pockets of some, so that someone else can have the benefit,” said Brown, R-DeFuniak Springs. ... “We need to think long and we need to think hard about what we’re doing.”

It’s an argument with strong backing from many in the insurance industry, who say the state is heading down the wrong path.

Letting Citizens compete means private insurers are discouraged from coming to Florida or expanding business here as the market stabilizes, said Justin Glover, a spokesman for State Farm Florida Insurance Co., the state’s largest private home insurer.

Plus, he said a more competitive Citizens can actually benefit big insurers like State Farm Florida. Not that State Farm Florida wants to lose customers, Glover said, but policy holders now can abandon their policies and switch to Citizens. And that means the storm risk once carried by a private insurance company is now on the state’s shoulders.

“That benefits the company,” Glover said. “The person who pays the bill is the citizens of Florida.”

Estimates aren’t available of how the Legislature’s actions will expand Citizens, but industry officials project a competitive Citizens will squeeze out private insurers as price-conscious consumers jump to the state-backed insurer for cheaper coverage.

The people’s insurer?

Those who support Crist in his efforts to enlarge Citizens acknowledge the risk, but say something must be done to help bring down insurance prices for homeowners.

House Democratic Leader Dan Gelber of Miami Beach calls the Legislature’s recent moves “faith-based initiatives,” but said the prevailing thinking was there were two choices with Citizens – either let it expand to spread its risk wider or find ways to shrink the company.

“Right now, it has straddled the fence, and it’s a very precarious position,” Gelber said. “We have to go one way or another. [Crist] wants to enlarge Citizens’ base, and in doing so, he may actually inspire some competition. I think he’s doing something.”

Citizens board chairman Bruce Douglas said he thinks the company is up to the task Crist has given. The company has overhauled operations and hired customer service staff to handle more policy holders. Two years ago, Citizens faced a torrent of criticism from state legislators for the way it mishandled customers after the hurricanes in 2004.

He thinks doom-and-gloom projections over a mushrooming Citizens are overblown, noting that the company’s policy numbers have actually decreased in the past two months.

He doesn’t expect a stampede of new customers based on coverage savings, because switching insurance companies could mean people lose multi-policy discounts with private insurers or would no longer be able to use their insurance agent.

Still, more people are applying for Citizens policies, with the company now averaging 70,000 applications a month, the highest level in its history. But Douglas said Citizens only insures about 30 percent of the state’s home and condominium owners.

“We really are kind of the people’s insurance company,” Douglas said. “We’re no longer the insurance company of last resort. We’re more an alternative insurance company with more competitive possibilities.”

Copyright © 2007 South Florida Sun-Sentinel, Kathy Bushouse and Mark Hollis. Distributed by McClatchy-Tribune Information Services.
 
Remodeling up in 2007

WASHINGTON – May 14, 2007 – Americans will spend nearly $233 on home remodeling this year, according to the National Association of Home Builders’ (NAHB) 2007 industry forecast. That represents a 1.9 percent increase from the record $228 billion spent in 2006, according to estimates from the U.S. Census Bureau.

“Remodeling continues to show strength despite the housing slowdown,” said NAHB Remodelers Chairman Mike Nagel, CGR, CAPS, a home remodeler from Chicago. “With more than 120 million homes in the United States plus $11 trillion in owner equity, the demand for remodeling will be there now and in the future.” Remodeling currently accounts for more than 40 percent of the home construction industry by dollar volume.

“Quite simply, we’re adding more homes each year than we’re tearing down, and these will eventually require remodeling,” says NAHB Chief Economist David Seiders. “Compared to other components of the housing industry, remodeling remains one of the few areas to show growth, at least in nominal terms.”

Driving the remodeling market are the size and characteristics of the housing stock. With an average age of 33 years and rising, older homes require more remodeling – both in terms of upgrading features to compete with new construction as well as maintaining their physical quality.

Though remodeling is somewhat cyclical with new construction, homeowners cannot put off a major repair like a leaky roof as they can discretionary upgrades, and that stabilizes the industry during slower housing markets.

© 2007 FLORIDA ASSOCIATION OF REALTORS®
 
 
 
Posted in:General
Posted by Ron Mastrodonato on May 27th, 2007 11:37 AM

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