Nurul Hana Adi Maimun

“The real estate sector is getting a little more pessimistic about the economy and a majority of professionals in the industry now see a recession ahead in the next 18 months.

A survey of 400 people in the real estate business by PricewaterhouseCoopers (PwC) and the Urban Land Institute (ULI) showed a drop in positive sentiment to 69% from 84% six months ago. Current levels are at the lowest in two years. “There’s a lot of weird stuff going on in the world—China, interest rates, volatility in the equity market—all of which is creating anxiety,” said Mitch Roschelle, a partner at PwC.

And while a majority of those surveyed remain positive for now, more than half expect a recession by the end of 2017, notes Roschelle, who adds that two out of the last four recessions have been in part due to a slowdown in the real estate market.

However, he sees a silver lining to real estate pros losing their optimism. “They’re saying, ‘Listen, maybe we need to back out. Maybe we need to not reinflate a bubble and cause another recession,’” said Roschelle. “If we don’t reinflate a bubble with housing prices and we don’t reinflate a bubble with commercial real estate prices, we may not have that bubble bursting causing another recession. So if there is a recession, real estate folks are saying, ‘It’s not going to be because of us this time.’” Global uncertainty may also lead to some overseas investors turning to U.S. real estate. “The more volatility that goes on in foreign markets and the more uncertainty there is about geopolitical risks in foreign markets, they tend to rotate toward U.S. dollar-denominated investments and income producing asset classes like real estate,” Roschelle said. “What’s interesting is foreign sentiment for U.S. real estate has improved while domestic sentiment has weakened.”

Source: realestate_iq

“Expensive housing is a problem not simply because it gobbles up a lot of money, but also because it eats into the things we would buy if we weren’t shelling out so much for shelter.

Families who struggle to pay the rent or the mortgage have to scale back on what they spend on health care or groceries or education. As a result, unaffordable housing has a way of creating other problems, too.

According to an annual, national housing survey by the MacArthur Foundation, more than half of Americans — 53 percent — in the last three years have made some kind of sacrifice to cover housing costs. They took on longer hours at work or an additional job. They stopped putting money away for retirement. They accepted tradeoffs for cheaper housing — like moving to neighborhoods that they felt were less safe or had weaker schools.

We know a lot about how many people face housing cost burdens and how hard it is to find an affordable home in communities across the country. But the reality that always hides behind these statistics is that households make hard concessions to keep the one thing they can’t do without. Alongside housing, other things start to look like luxuries: a car, a bottle of medicine, a box of toys for the kids or a bank account for retirement.”

Source: realestate_iq

“Rents are rising while interest rates remain low, yet young Americans are still largely choosing to rent instead of buy.

Home rent costs have jumped 14 percent since 2010, and are expected to rise another 3.3 percent this year, to year to an average of $1,161, according to commercial property tracker to Reis Inc.

Real estate agent Joan Kamens said high student loan debt is preventing adequate debt to income ratios required by lenders for a mortgage.

Lifestyle habits are a significant contributor as well, she added.

“Millennials are getting married later in life than previous generations, and a sense of urgency to purchase comes with stability, marriage and growing families,” said Kamens, an agent with Coldwell Banker Hearthside in Newtown, Pennsylvania, near Philadelphia. She is also the mother of two 20-somethings.

According to a recent Goldman Sachs study, 30 percent of millennials consider buying a home important but not a priority.

So when will the next generation start to buy houses? Kamens said it will happen once they’re more established in their careers and family, and “when education for children becomes a factor, they may settle with less for the convenience of quick travel time to workplace.” Neeta Mulgaokar, a real estate agent in New York with Mirador and a millennial, stands by the trend.

“Many of my clients are saying, ‘Why would I buy when it’s so expensive? I could use that money for something else like travel or starting a business.’ ”

Another big factor is the transient nature of the generation’s preferences coupled with the technology that supports their habits.

“Many companies, like Ernst & Young, are including remote work options for their millennial employees,” Mulgaokar pointed out.

“Many millennials have been burned or felt trapped by contracts (cell phones, cable, even student loans) and are shying away from long-term commitment,” she said. “They will pay more to avoid it all together.”

Source: realestate_iq

WASHINGTON (June 21, 2016) — Commercial drone use in the real estate business got a boost today with the release of the Federal Aviation Administration’s final rule governing small unmanned aerial systems, or UASs, in the national air space.
Drones are increasingly being used in commercial applications, but federal regulations have required commercial drone operators to apply for a “Section 333” waiver from the FAA before they can fly. Over 5,000 waivers were issued to commercial entities, a significant portion of which were used for the real estate business, but only licensed pilots were eligible to fly commercially.

FAA rules released today create a clearer pathway for real estate professionals to use drones for commercial purposes, a prospect that National Association of Realtors® President Tom Salomone called a win for the industry. “We’ve worked hard to strike a responsible balance that protects the safety and privacy of individuals, while also ensuring real estate professionals can put drones to good use,” said Salomone, broker-owner of Real Estate II Inc. in Coral Springs, Florida. “That effort just took another big step forward. The rules unveiled today will help more real estate professionals take flight, making the efficiency and innovation that drones have to offer available to a much broader base of operators.” The FAA’s announcement marks a long-fought victory for for the National Association of Realtors®. Since early 2014, NAR has worked with the FAA and industry partners to integrate drones into the national airspace for commercial use. NAR wrote to the FAA on numerous occasions to weigh in on the final Small UAS Rule, and testified before Congress to support the use of drones in real estate.

Despite eliminating the requirement that operators hold a pilot’s license, anyone looking to fly drones commercially will still have to comply with strict requirements designed to protect people on the ground.

Drones are useful in a number of real estate-related applications, including marketing properties, assisting with appraisals, facilitating insurance claims and overseeing utility work.

Source: realestate_iq