Published on March 11, 2014
@AmyRosenberg PR’s Perspective on Content
@AmyRosenberg Content Marketing is Old News The first newspaper dates back to Ancient Rome.
@AmyRosenberg Be A Reporter—Write For The Seasons
@AmyRosenberg Be A Reporter—Write For The Seasons
@AmyRosenberg How We Got This Coverage Q & A with Brian Allen, President of Windermere Cronin & Caplan Realty Group, Inc. (Windermere) What are your general real estate predictions for 2014? 2014 will start off pretty strong because demand is quite a bit higher than supply. Appreciation is predicted to be between 5% to 6% and many economists are predicting an increase in mortgage rates to between 5% and 6%. Rising mortgage rates will bring two responses: “Time urgency” will cause some buyers to panic. Feeling that they will get priced out of the market, they end up making quick buying decisions. Rising interest rates will cause a slower rise in home prices. Some buyers, many of them first time home buyers, will fall out of the market. How do higher mortgage rates affect buyers? A 1% increase in mortgage interest rates corresponds to about an 11% decrease in purchase price ability. This is presuming a borrower is trying to buy a home at the peak of their qualifying ability, which is usually the case for first time home buyers. Interest rates went from around 3.5% last year, to today’s 4.5% (representing a 1% increase). If a buyer qualified for $250,000 last year, they only qualify for $222,500 today. Compounding that problem is the increase in home prices for the Portland metro area between 2012 and 2013 which was between 11-12% on average. Last year’s $250,000 house is probably valued at $280,000 (11% appreciation) today. So, a first time home buyer’s purchasing power now is more than 20% less than last year. The $250,000 house last year is now worth $280,000, but the first time borrower can now only purchase a home priced at $222,500. Because the predictions for appreciation in 2014 are not as high (between 5% and 6), the impact on a borrower will be a bit less going forward than it was over the past year. How do first time home buyers affect the marketplace? First time home buyers help drive the marketplace—allowing homeowners in the lower price range to move up, which then affects the mid-range homeowners who are also looking to move up and so forth. Low prices and interest rates allowed first time home buyers to participate in the market this year. How does inventory fit into the picture? Inventory is going back up compared to where it was in the spring of 2013 (Multnomah County now holds 3.5 months of inventory). While it appears that inventory is higher in Clark County, this is because there is a lot of new construction there, with builders listing homes that aren’t even built yet. If you remove those situations from the picture, inventory is also at 3.5 months in Clark County. How will investors participate in the marketplace? With the double-impact of rising prices and interest rates, investors are starting to pull out of the market. Not as much marketplace competition will lessen demand. While prices will continue to rise, they will not rise as fast.
@AmyRosenberg How We Got This Coverage What real estate trends did we see in 2013? Low inventory tipped the scale in the seller’s favor 2 trillion dollars of equity growth occurred in 2013 (however there are still people who can’t sell because they are under water) 11-12% increase in prices Current and future buying trends? Two current trends will likely continue into the next year: A mega-trend is occurring in which young families are electing to live in urban areas. This is a reversal of the post war era trend that saw families head toward the suburbs (this lasted for quite a while). These people are motivated by “lifestyle,” which includes walking scores and easy access to coffee shops, grocery stores, etc. Price-driven purchasing is bringing the market back in communities such as Happy Valley and Clark County. While these people might have originally been interested in city living, time in the marketplace brings them to areas where they appear to get more (square footage and amenities such as a garage and extra bedrooms) for the money. Some notes on equity & motivation: There is real equity and “psychological” equity. The latter is what homeowners believe their home is worth. This factor will always affect the marketplace; no matter where we are with interest rates and inventory. For the last five years homeowners only sold their homes because they needed to (for example a new job took them to a new city), not because they wanted to. Inventory is still low because we are still missing the people that want to move. With more and more people starting to put their homes on the market because they want to, the prices will not rise as fast. Nobody believes that prices will cease to rise, but not as fast as they have been. We will likely see a 5-6% increase in prices for 2014, compared to 11-12% in 2013. What is your response to the reports of sales volumes dropping in November? The holidays traditionally bring lower sales in the winter. Yes sales during this November compared to last November (2012) was down but last year’s winter was the start of the uptick in the market. Also the homebuyer tax credit was introduced during the winter of 2012. Thoughts on the rental market? Rents are higher than ever—a fact that has been driven by the recession as millions of people were added to the rental pool. A large void of residential apartment properties created the opportunity for the building of dozens of apartment buildings. We are currently getting close to the saturation point with too many rental properties available which will cause rents to decrease.
How We Got This Coverage How do higher mortgage rates affect buyers? A 1% increase in mortgage interest rates corresponds to about an 11% decrease in purchase price ability. This is presuming a borrower is trying to buy a home at the peak of their qualifying ability, which is usually the case for first time home buyers. Interest rates went from around 3.5% last year, to today’s 4.5% (representing a 1% increase). If a buyer qualified for $250,000 last year, they only qualify for $222,500 today. Compounding that problem is the increase in home prices for the Portland metro area between 2012 and 2013 which was between 11-12% on average. Last year’s $250,000 house is probably valued at $280,000 (11% appreciation) today. So, a first time home buyer’s purchasing power now is more than 20% less than last year. The $250,000 house last year is now worth $280,000, but the first time borrower can now only purchase a home priced at $222,500. @AmyRosenberg
@AmyRosenberg Be A Reporter—Write For The Trends
@AmyRosenberg How They Got This Coverage
@AmyRosenberg Be A Reporter—Write For Editorial Calendars
@AmyRosenberg PR Deadlines • Plan ahead. o Pitch 6 months ahead for national glossy. o Pitch 3 months ahead for B2B trade. o Pitch 6 weeks ahead for weekly papers. o Pitch 3 weeks ahead for daily papers. oLonger for special/weekly sections. o Broadcast: be ready to go the minute you pitch. oExcept for morning shows.
@AmyRosenberg Resources Select resources and tools: • HARO – http://www.helpareporter.com/ • Cision – Sign up for a free trial to build your media database or email firstname.lastname@example.org to get a customized list built for a nominal fee. • PRSA – https://www.prsa-portland.org/ • The news
@AmyRosenberg Thanks! Amy Rosenberg President, Veracity email@example.com slideshare.net/TrueVeracity
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