The real estate market has the Federal government trying to pass legislation helping mortgage lenders and home owners survive the sub-prime mortgage market correction on one hand. On the other hand the Department of Justice (DOJ) has launched investigations into the real estate brokerage industry.

Last Fall, the DOJ unveiled a new area on its Anti-Trust Division website aimed to educate real estate buyers and sellers to the DOJ’s view of the real estate brokerage situation. One area the DOJ took into account in their process is the Internet’s affect on buying and selling real estate.

The DOJ notes “the Internet helps consumers to educate themselves about other areas of home buying and selling. For example, consumers can use the Internet to research brokers, mortgage and lending options, and recent home sales and home valuations in their community. Consumers also can find information about schools, crime, and other variables related to home purchase decisions through a host of online sources, including websites hosted by their municipalities.”

One real estate broker commented at the DOJ public hearing that “Today’s sellers and buyers are more educated and more knowledgeable thanks almost entirely to the growth of the Internet.” Hopefully, your real estate website is one that is educating your market.

Like many real estate buyers, the DOJ also scanned the National Association of Realtors’ research on its website to find what real estate research people are doing on the Internet. “Features ranked as most useful among home buyers searching for a home on the Internet were photos (identified as very useful by 83 percent of home buyers), detailed property information (81 percent), and virtual tours (60 percent).”

When the Federal government realizes a trend in the real estate market, it must be a well set trend. Indeed real estate agents can review the DOJ’s April 2007 Competition In The Real Estate Brokerage Industry Report’s Section II on the Internet’s Affect On Real Estate Brokerage to see if their real estate website is offering many of the tools the DOJ has found helpful to real estate buyers and sellers.

The DOJ’s conclusion is that with greater education, broker’s fees should decrease, which, for some reason is what they are interested in seeing. A real estate agent’s conclusion from the same facts would be to make sure their real estate website is getting a good share of the potential clients’ growing use of the Internet to find agents, view property and get educated on the real estate process.

An effective website can sell mortgages and real estate in this economy, but real estate agents and mortgage lenders can also improve their market standing by using their websites to educate home buyers in several areas to help the buyers’ positioning in the mortgage process:

• Get credit scores above 720 – give tips on how to clean up credit and position credit card debt to look the best,
• Stay with their current job until the mortgage closes on the house – length of work and steadiness is now a larger part of the lending equation, and
• Build a financial war chest in some way (“Mom I know I haven’t asked for money since I left college…”) – be prepared to put 5 – 10% down on the house.

Some experts are predicting that the current real estate market will not turn around until 2009. If the dollar continues its downward slide, it may be that new niche markets are created as the US economy gets boosted by petro dollars, Fire Ring currencies, euros and rubles invested in the real estate market, most likely luxury homes and commercial real estate. Real estate websites have a tremendous advantage over traditional advertising in that their market is international. Google searches in Tokyo for “[your town] real estate” may come right to your website.

Historically, Americans prove to be smart shoppers in the long term. As the saying goes, “Bad money chases out good money”, wealth flees from the falling greenback to financial solid ground, such as real estate. With the help of the Fed, second homes or vacation cabins are being viewed as a better long term investment than savings accounts.

All the turbulence in the market is a strong argument for a well designed real estate website or mortgage website that positions itself in the minds of the active local real estate market. Use all the available website tools to educate and make known your expertise and availability. As your 24/7 calling card, your website can make it easy to do business with you!

The national real estate economy, as regularly reported in the news, is a fiction. Several real estate economy fallacies continue to exist that main stream media regularly report and treat as facts. Being aware of these misleading “facts” can help you deal with unrealistic fears or hopes that your clients may bring to a real estate transaction. What are these smoke screens?

First: There is no “national” real estate market. Real estate agents have long known that there are only local or niche real estate markets based on location. In the national real estate economic picture, the sum does not reflect a good portion of the parts.

Word on the street is that the Miami condominium market is caput in 2007 and 2008 due to speculation buying and overbuilding. True to a certain extant. However, the Miami condominium market is actually three markets based on location, the size of the condominium, and the income/wealth of the prospective buyers. The top end condominium market for large square footage and a large balcony is hot property in this down market. The buyers are not speculators, but overseas buyers who want the warm climate and relative low prices (due to central bank downward manipulation of the dollar).

Staying aware of the real trends in the market and not allowing the press to blind you to selling opportunities allows you to tailor your website and advertising to the active markets. But then, even the down markets have their buyers in investors looking for undervalued properties.

Second nonsensical fact: The real estate market has boom and bust cycles like the stock market. Stocks can be bought and sold in seconds, even programmed to have computers automatically react to stock price changes. So the stock market can have wild swings even within its long term trends. However, the real estate market moves to a much slower drummer.

The real estate market trends never boom or bust. They move slowly up or down, but in the end, usually trend upward. Even with in the overall trend the commercial and residential markets move in different directions. Unlike stocks, properties take days and months to change hands. Taking a bare plot of land and developing a house or subdivision takes months to years. Also, as long as central banks and governments play with fiat currency to keep the slow boil under the frog, real estate and commodities will always be a safe and sage harbor for wealth.

Also, with a longer buy/sell cycle, the demographic changes in the market cause the local markets to continually move counter to the general trend. In today’s market, most baby boomers are moving out of the colder climes affecting the slump in the California, Nevada and Florida real estate markets and heating up the small house and condominium markets. People are getting married later in life leading to more demand in rentals, small houses and condominiums for singles. Another big question in the market is the rate of immigration. Given the fickleness of Congress, another “amnesty” is most likely in the works, allowing millions to legally buy property.

Third misleading idea: There are times when it is bad to enter the real estate market. There is always a time to ignorantly enter any market. But to an educated real estate investor, any market has its buying and selling opportunities.

As an experienced real estate agent, always trust your knowledge and instincts on the real estate economy instead of the statistics quoted in the news. So when you read the news on the economy remember Evan Esar’s observation that statistics is “The science of producing unreliable facts from reliable figures”. That remains as true as ever in regarding today’s real estate economy.

As a Realtor, how do you position your real estate website to stay relevant in a sea of constant changes? The nature of the real estate market is that it is constantly moving. Houses go up for sale, houses get sold. Match your website marketing to your real estate market.

According to the US Census Bureau, in 2005 – 2006, 61% of the people who moved in the United States, moved to another home within the same county. Since someone you helped move three years ago may be ready to move again, position part of your website marketing to the target market of past clients. Does your website have something to attract former clients or their referrals?

Remember, your real estate website’s key asset is its ability to target specific markets through the use of keywords and key phrases. A keyword is simply a word internet users type in to a search engine to find your website. Make a list of all the possible markets and check to see if your site has a page that addresses that market. A sample list might read:

• retiree market looking to buy a smaller home closer to grocery stores and safe evening activities;
• growing families looking for larger home in area with good schools;
• counter culture herbologists looking for large basements; (OK, take a pass on that)
• aging families looking to move to neighborhood with better high school or closer to the university;
• successful businesses ready for bigger quarters or a new store near a growing market; or
• job change related moves – closer to mass transit.

Each of these markets can be addressed with a content-rich web page, out-bound links to local community and school information websites, or in-bound links from sites that are highly ranked by the search engines, such as a chamber of commerce.

Discipline your marketing to only address one real estate market per page. If you target several real estate markets on one page, the search engines do not discern one clear keyword to rank on which to rank the page.

Once you have your list of markets, develop a list of keywords for each market. Use a search engine, like Google or Yahoo, to test and refine your keywords. Type in the keywords and see how many pages come up. You can also research with Google Adwords or WordTracker. An example of keyword refining is to see if more people in your area search for a home under “California real estate” or “California homes for sale”. It may seem that the keywords would rank the same, but we have found that the East Coast and the Rocky Mountain states tend to have very decided preferences on their keyword searches.

Your real estate website is the rock in the stream of property changing hands. Cast as many fishing lines into that stream as you can think up. Make sure the stream doesn’t pass you by.

The real estate economy is one of the most fragmented markets in world. The use of an experienced real estate agent is the greatest aid to understanding the real estate trends in the local economy. While headlines report the up or down movement of the broad real estate market trends, neighborhoods and niche markets can be moving against the major trends. Make sure the home for sale you are interested in is on an upward trend.

Though the real estate economy can suffer downturns or “corrections”, real estate is a durable investment – well-constructed buildings can last for decades and the land itself has a proven track record of staying power. For this reason, real estate tends to be a long-term investment. The two main areas of an area’s real estate economy are the residential and the commercial real estate market. These markets usually have different boom and bust cycles.

Commercial real estate has a longer economic cycle. The added feature of commercial property, besides its equity accruing property is that during the life of the building its commercial use also brings a financial return.

Residential real estate markets often lag the surrounding commercial building cycle. The influx or loss of area businesses acts as a market driver or brake for the local economy, affecting real estate transactions and new construction.

An unofficial way to check on an areas real estate economy is to check on Google Adwords to see how often people search for real estate or homes for sale in a certain area. A lot of keyword searches for a particular suburb may mean that the pricing is higher, but that the properties in that area are more desirable.

Three additional drivers of a an area’s market trend is the type of economic returns that investors are looking for when acquiring property:

• Its equity appreciation;
• Its positive cashflow (buying an industrial or multi-family rental property), or
• Its tax advantages.

A downturn in the property prices has long term repercussions since a home buyer or property investor may owe more on a property’s mortgage than the property is worth. This slow-down in property buying causes a further decrease in value of area properties. On the other hand, governments have long realized the value of a successful urban renewal and giving tax advantages to neighborhood developers. The amount of investment into an area causes positive effect on the area property values, leading to more healty market-driven investments.