Stefan Swanepoel is a well known and accurate prognosticator of real estate trends. His latest report, Swanepoel Trends Report 2009, is not only interesting, but critical to understanding how we can and should position ourselves to take advantage of the changes currently reshaping our industry. 

Swanepoel believes 2008-2012 will be the “most important and formative years in reshaping the real estate and financial services industries for the future.”  If you are planning on future success in real estate, then you must learn more about the trends shaping our future.

TREND 1 (The Cycle of Change): The real estate industry is largely unskilled at serving the needs of today’s consumer. Whereas many agents are still focused on trying to sell the buyer a new home, the customer is actually searching for someone to provide quality advice and interpret the overload of information. Brokers and agents should use this “quieter” time to re-energize, re-tool and re-position themselves and their companies. “Out of the ‘subprime ashes’ of 2007 and the ‘mortgage meltdown’ of 2008, we are going to see a whole new real estate industry evolve and develop.” (See trends below for insight into the new face of real estate.)

TREND 2 (Online Power Players): Online communities and social networks are growing by astounding numbers. Facebook is the largest social media site with 140 million users. Twitter went mainstream just last year and now has 5 million users. The consumer had to push the real estate industry to the Internet and email; they will do the same with online communities. REALTORS should take advantage of this new platform – not for self-promotion – but to provide useful, quality information to the buying and selling consumer.

TREND 3 (Recovery): It’s not news that the real estate industry is facing difficult times. Swanepoel summarizes how we got here and current issues impacting recovery. “The dilemma we find ourselves in is extensive, the solutions problematic and the execution complex. There are so many pieces that will have to fall into place, we better stop complaining, looking to locate blame and start thinking how each of us can play a role in contributing towards achieving a healthy housing market again. It will not be easy and we have a ways to go.”

TREND 4 (NAR): NAR celebrated its 100^th anniversary last year and announced its Second Century Initiatives. The 13 initiatives are aimed at making REALTORS and NAR more relevant in the coming years. Swanepoel cites several of the initiatives as trend setting. NAR will launch the REALTORS Federal Credit Union later this year. NAR will also begin to introduce the REALTOR Property Resource (RPR), a central, comprehensive database of information on every U.S. real estate property (not just those for sale.) The RPR will be 100% owned by NAR and for REALTORS’ eyes only. Also, an NAR group has just begun to consider what REALTOR membership should stand for, which may lead to higher qualification requirements.

TREND 5 (MLS): The MLS is feeling pressure from every corner – technology, consumers and even the government. There will be many trends to watch for this year. The expansion of regional MLS systems is expected to gain further momentum. Watch for the emergence of statewide MLS systems (California is currently working on a statewide system). A national MLS might even be possible in the future. Listing syndication services will continue to grow – allowing a single point of entry for a listing, which can then be shared with other websites. A separate group plans to launch a national database of qualified buyers later this year.

TREND 6 (Foreign Factor): The major U.S. real estate franchisors have been expanding their brands internationally for years. Now leading international companies are entering the U.S. market. For example, Canadian-based Brookfield Residential Property Services, which operates the #1 residential franchise in Canada, just bought GMAC Home Services (including GMAC Real Estate). Strong foreign currencies and depressed domestic prices have increased the number of foreign buyers looking to the U.S. market for second homes or investment properties. A global IDX has been launched. Watch more IDX sites go multi-lingual this year.

TREND 7 (Info Overload): A recent NAR survey revealed that 84% of all residential sales involve the Internet and 74% of Internet savvy buyers find their REALTOR online. Yet 80% of all Internet users complain of “information overload”. Websites primarily comprised of just listings and information on the buying and selling process or personal bios are not generating many leads from today’s consumer. The issue today is no longer a lack of information, but rather providing the right information at the right time to fill a consumer’s specific information needed. Today’s consumer wants a robust, complete, all inclusive, consumer-friendly website that provides not only listings, but detailed information about the neighborhood, community, schools etc.

TREND 8 (Green): The “Green Movement” is gaining momentum. According to a recent NAR survey, an increasing number of buyers is interested in the energy efficiency of green homes and the potential cost savings. Today’s real estate professional will be expected to become knowledgeable in the costs and benefits of green homes and buildings.

TREND 9 (Energy): The oil and energy crisis is here to stay. The age of urban sprawl is being replaced with a move to “new urbanism”: smaller homes on smaller lots in a densely settled, walkable community. Buyers will focus on “commute time” with a critical eye – not just commute time to work, but to school, church, stores and entertainment. Another emerging trend that may counterbalance the negative impact of oil is the rapid growth of telecommuting and “virtual assistants”. We can expect to see more creative options in the near future, in light of rapid advances in communication and data transfer.

TREND 10 (E&O Insurance): E&O insurance was created to provide coverage against negligent non-intentional acts such as errors and omissions that are not deliberate, knowing or intentional acts or wrongs. In 36 states (including Virginia), E&O insurance is not mandated for real estate firms or agents. As brokerages sell, merge or close, E&O coverage may lapse – leaving brokers and agents with no coverage for their prior transactions. Brokers and agents should fully understand their coverage and push for mandatory coverage for all licensees in all states.