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SXSW: Mayors address using data to solve housing challenges

(REAL ESTATE NEWS) At SXSW, three mayors on stage address the challenges of housing and how data can be used to solve the multi-pronged crises.



sxsw housing

The critical nature of data

We all know that data collection is at an all-time high. Facebook knows what to sell you based on your browsing history since you’re logged in, your smart thermostat knows when you’re home and when you’re away regularly, your phone knows everywhere you’ve been, and companies are tapping into this data every microsecond.

But what about city governments? How are they tapping into the available data, and further, how are they using it to solve local housing challenges?

Short answer: They’ve just scratched the surface.

SXSW panel on housing challenges

At South By Southwest (SXSW), Denver Mayor, Michael Hancock, Milwaukee Mayor, Tom Barrett, and Cambridge Mayor, Denise Simmons all spoke about current and future initiatives they’re working on to address housing demands.

On stage, Mayor Simmons focused extensively on Cambridge’s inclusionary zoning efforts and Mayor Hancock acknowledged that Denver can’t build their way out of their 35,000 unit deficit (despite many initiatives to do just that). Both Cambridge and Denver are dynamically different than Milwaukee which has battled a long population decline and is finally growing but has a more intense focus on lower income families with strong actions against bad landlords and blight homes.

Mayor Simmons uses available studies to address tensions with developers who fight the city’s increases in requirements for portions of properties to meet affordable housing standards.

But when pressed, all three danced around questions of using the data for more granular specifics than affordable housing units, population growth, and transportation challenges. This again reiterates that city governments have barely scratched the surface and while not addressed during the panel, we would note that data collection and good data analysis can be extremely expensive and when a government is trying to squeeze money from the budget already, it’s still not a reality.

Politics and housing

But people are working on to make it a reality. In the halls of SXSW you’ll hear buzzing about government data hackathons and it’s not about hacking into the government, rather private citizens taking the endless public data and turning it into something useful for citizens and governments. You’ll also hear a considerable anti-Trump sentiment, as is common among people at massive tech conferences.

And as you’d guess, three politicians on stage took the opportunity to sidenote their fears about the federal budget squeeze. Although HUD Secretary Ben Carson vowed to protect lower income neighborhoods during his confirmation hearing, there is a potential $6B HUD budget cut on the horizon.

All three mayors expressed that they already struggle with their current funding and that stripping federal funding, particularly community development block grants (CDBGs), would be devastating to their efforts.

Affordability, front and center

The National Association of Realtors (NAR) has continued to note with urgency that affordability is one of the most pressing issues on the housing industry, and all three mayors are using available data to implement initiatives to help their local citizens.

There is massive opportunity for local and state governments to use available data to do so much more than just push back on developers – data can transform sustainability efforts, how healthy we are as communities, and how we connect.

We asked Mayor Barrett how they were partnering with the Realtor community on affordability and he noted they were working with the Wisconsin Realtors Association but didn’t dive into details.

Again, this is where we see another tremendous opportunity – for brokerages, local boards, and state associations to partner with mayors to offer their data to local governments, to lend their time and talent to tackle affordability challenges.

While housing is so much more than affordability, with populations shifting in and out of urban and suburban areas, it is currently a core theme when talking to anyone in a position to impact the future of housing. Particularly mayors.

Let’s talk again in 10 years

When we have this discussion again 10 years from now, you’ll hear more about data being used to track upward mobility of residents, sustainability as part of housing requirements, new ways of meshing private and public dollars, and much more.

The NAR Center for Realtor Technology (NAR CRT) has been partnering with universities, private companies, and taking other creative measures to study how data can be used. For example, they’ve asserted that some day all smart thermostat data could be collected and become a line item in the MLS so that you can search for a home or eventually a neighborhood based on air quality. And based on discussions with them, even that is just scratching the surface of what’s possible.

City governments will catch up to the CRT model of constantly digging, theorizing, and partnering to research without having to blow the entire city budget on a data firm. So let’s talk again in a decade – I can’t wait!


Lani is the Chief Operating Officer at The Real Daily and sister news outlet, The American Genius, and has been named in the Inman 100 Most Influential Real Estate Leaders several times, co-authored a book, co-founded BASHH and Austin Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.


Why it’s about to get more expensive to get a mortgage

(FINANCE) Borrowing money is getting more expensive, especially for those looking to get a mortgage. But why?



bonds and mortgages

Although there have been some blips, bonds have grown substantially in value since the 1980s. They’ve performed extremely well for a number of reasons, not least of which is the big slowdown in inflation over that time period.

The result, for investors, has been that anything “bond-lik,e” i.e. capable of paying a regular income – like a high-dividend stock or even a property like your home – has shot up in value. A reversal of bond prices would mean less support for such investments.

That’s what the economy is currently experiencing. According to Financial Times, American worker wage growth is hastening the sell-off of bonds by the US government, which is decreasing the overall price of bonds. As bond prices go down, the interest rates that they offer new investors go up. That rate jumped to 2.85 percent last Friday, the highest level since 2014.

Since the rates at which banks lend their money are largely based on the interest rates offered by bonds, regular folks looking to take out a mortgage or a loan are facing higher costs.

How does this work?

If we’re talkin’ bond prices, we’re talkin’ yield. When the price of a bond goes up, the yield of that bond goes down! Let’s say you’re getting paid $5 each year. If you pay $50 for that right, then you’re making a 10% “yield” (5/50 = 10%). But if you pay $100 for that right, then you’re making a 5% “yield” (5/100 = 5%).

It’s the same thing with the price of a bond because the amount a bond investor gets paid (usually) is fixed. And so, when the bond goes up in value, the “yield” goes down – and vice versa.

For realtors, its important to help clients shop for the best rates to improve their confidence in this market. Leveraging the right online and local financing resources can help potential buyers get the best deal. Explaining broader market context is also critical. Historically, a three percent interest rate is still very low.

According to Investopedia, mortgage rates averaged 7.81% in 1996 and 10.19% in 1986. Instilling confidence with information will put buyers and sellers in the right place to make moves.

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Real Estate Big Data

Murdoch wants FB to pay for content – should RE search sites pay for listing data?

(DATA NEWS) Rupert Murdoch argues that Facebook should pay to feature trusted news. Sounds like a familiar argument that real estate practitioners have made for over a decade.



rupert murdoch

There’s an old argument in the real estate industry that you’ve probably heard – listing data is aggregated by real estate search sites like Zillow, which makes big bucks on that free firehose of data, but doesn’t send a cut of said profits back to the content providers (and should).

This conversation is being revisited after Facebook’s announcement that they’re going to restructure how data flows. Just as publishers are asking why Facebook doesn’t pay for content, the real estate industry is again asking – why is the data real estate professionals produce aggregated for someone else’s financial benefit?

Media mogul and Executive Chairman of News Corp, Rupert Murdoch, issued a press release outlining his urgent belief that Facebook and other media giants should pay publishers for their content, rather than benefiting from the content, keeping the profit to themselves, and padding their stock prices. This comes at a rather interesting time, given many media giants are changing they way the game is played: YouTube is causing a bit of a stir with their top contributors, Facebook has vowed to get back to their roots, and it won’t be long before other social media and marketing sites follow suit.

Amidst these changes, though, where are the benefits for the content creators?

There are influencers on YouTube that promote new products; Facebook and Twitter users who supply endless amounts of content from which other companies/brands benefit, and to apply this to real estate, Zillow, Trulia, and others who aggregate brokers’ content into their platforms and benefit tremendously. It’s shrewd business.

This is especially frustrating when you consider, as Murdoch points out, “publishers are obviously enhancing the value and integrity [of the platform] through their news and content but are not being adequately rewarded for those services.” Realtors® create data for aggregators by listing properties in the MLS, then, they are charged to be showcased on the very platforms already utilizing and profiting from the information that has been provided for free.

While Realtors® may have been paid for their listing by their client, they have not been provided a percentage of any search site’s profits, which is the primary argument Murdoch makes to Facebook.

Murdoch proposes a fee structure to remedy this issue, much in the same way cable is structured, whereby publishers would be compensated for their contributions, but it isn’t clear how this would work long-term, although it is food for thought about who really owns data.

According to Murdoch, “The time has come to consider a different route. If Facebook [or any other media giant] wants to recognize ‘trusted’ publishers, then it should pay those publishers a carriage fee similar to the model adopted by cable companies. The publishers are obviously enhancing the value and integrity of Facebook through their news and content but are not being adequately rewarded for those services. Carriage payments would have a minor impact on Facebook’s profits but a major impact on the prospects for publishers and journalists.”

In other words, real estate search sites should be paying broker for using the data they provide, instead of charging for extra bells and whistles in the name of marketing. Even if the real estate search site is one of Murdoch’s own…

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Real Estate Big Data

Housing optimism cools – what will it take to heat back up?

(REAL ESTATE NEWS) Despite economic gains and a hot housing market, optimism is cooling. Why is this happening and what’s the cure?



fair home prices existing home sales housing

Housing is a complex creature – the market can be on fire, but optimism can wane nonetheless. The National Association of Realtors (NAR) is reporting that despite solid job creation, the strength of the economy, and increased economic growth, many households are less keen on believing now is a good time for buying or selling, and are overall less confident about the economy.

This comes as a result of the fourth quarter HOME (Housing Opportunities and Market Experience) survey, which samples US households by a random digit-dial and was conducted by TehcnoMetrica Market Intelligence that gathered 2,705 households. The HOME survey collects data on a monthly basis and is focused on identifying real estate trends.

Despite an improving economy, more hiring, and low mortgage rates, optimism in home sales was not as expected, according to Lawrence Yun, Chief Economist for the NAR.

In general, most prospective home buyers had to deal with a lack of inventory – less construction, fewer sellers, and a lack of affordability.

Reduced economic confidence in the face of the economy’s improvements persisted, with more households feeling less secure about their financial situation, and less people believing the economy is improving. Simply put – they aren’t feeling it.

Renters are less engaged to buy, as demonstrated by a two percent decrease in renters believing now is a good time to go get that home.

Overall – the people most excited to purchase homes are current homeowners, households with income above $100,000, and those living in the Midwest and South. If you live in the West, it is likely that you believe yourself to be in a good market for selling a home.

Overall, people more firmly believe it is a good time to sell their home over last year, which can spell some good news for potential buyers in 2018, as more people may be comfortable putting their homes on the market.

The key is that housing supply must increase. New builds and more sellers placing homes on the market will improve confidence about the housing supply and can work in tandem with a better job market and improved economy to make households feel more optimistic about their #future.

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