A year ago, Inman News provided a list of real estate predictions for 2006. Here’s how we did:
Prediction 1: The Google Base listing service will be a major hit and completely rearrange the online listings and lead generation landscape for real estate, marketing and media companies.
Google Base steadily picked up real estate listings throughout the year and in November launched a single page for real estate professionals to help them load listings in bulk or individually. Some prominent brokerage firms — including Windermere, Real Living and Prudential California/Nevada/Texas Realty — announced that they have started uploading listings to the Google Base site.
Prediction 2: A cooler housing market will shake tens of thousands of real estate agents out of the business.
The number of agents who belong to the National Association of Realtors has not decreased, but we have heard from readers and local news sources that plenty of agents have quit the business this year due to shrinking sales.
Prediction 3: The U.S. Justice Department’s case against the National Association of Realtors will reach a stalemate, pending another industry-wide lawsuit over the copyright of property listings data.
The DOJ’s antitrust case against NAR is pending and neither side expects to settle anytime soon. However, we have not learned of an industry-wide listings copyright suit.
Prediction 4: A few major brokerage companies will pull their property listings from the traditional multiple listing service and create their own private MLS.
This hasn’t happened across the board, but brokers in Chicago have taken more control of the MLS by approving a merger between the area’s largest group, the Multiple Listing Service of Northern Illinois (MLSNI), with a smaller broker-owned rival, MAP MLS. The new entity will give brokers ownership of the MLS. (The Chicago deal is pending while MLSNI shareholders work out differences. See Inman News story.)
Brokers in other markets also are pushing MLSs to consolidate, restructure and provide brokers with more control — the brokers driving these changes say that it’s time for MLSs to be more responsive to members’ needs and wants.
Prediction 5: A handful of traditional brokerage companies will open alternative, discount channels in addition to their full-service options to diversify their businesses.
We haven’t seen evidence of a handful of traditional brokerage companies opening alternative, discount channels, but we have heard of individual agents going this route.
Prediction 6: Former Homestore executives Stuart Wolff and Peter Tafeen will settle criminal and civil lawsuits accusing them of misleading investors and causing Homestore’s financial nosedive about five years ago. The two will come out of the scandal virtually unscathed.
Tafeen entered a plea agreement in March and agreed to testify against his former boss, Wolff. Tafeen pleaded guilty to one count of securities fraud for his participation in a fraudulent advertising scheme and was sentenced to 30 months in federal prison followed by three years of supervised release.
Wolff went to trial and was found guilty of conspiracy, filing false statements with the Securities and Exchange Commission, lying to accountants, fraudulent insider trading, and falsification of corporate books and records. He was sentenced to 15 years in federal prison, and ordered to pay $5 million in fines and restitution. Wolff is appealing the conviction and sentencing.
Prediction 7: Inman News Publisher Bradley Inman will launch another company, this time focusing on cyber-dating within the real estate community. He will also launch a documentary film series, “Life and Times of Real Estate Rogues.”
Bradley Inman indeed launched another company in 2006, called TurnHere. The company creates digital videos that can be distributed on Web sites, e-mails, CDs, cell phones and iPods. While TurnHere does not focus on videos about cyber-dating, the company did just sign a deal with Match.com.
Prediction 8: Interest rates will steadily climb, but remain low enough that a wave of homeowners with aging adjustable-rate mortgages will refinance into long-term, fixed-rate loans, creating another boom for the mortgage and title industries.
Interest rates did climb this year, but they also fell and ended up pretty close to where they began in January. Many homeowners did refinance to lock in a low long-term rate.
Prediction 9: Wal-Mart will open an online home-ordering business, much like Sears’ catalog homes of the early 1900s.
Wal-Mart has not begun an online home-ordering business, but the major retailer did set off controversy in the real estate and banking industries this year when it applied for a charter to operate an industrial bank. Industrial loan companies are state-chartered, state-regulated, federally insured financial institutions that are owned by both financial and commercial companies. ILCs can offer a full range of loans, such as consumer, commercial and residential real estate, and small-business loans. The National Association of Realtors and the American Bankers Association have supported legislation that would block Wal-Mart and other retailers from obtaining a charter for industrial loans.
Prediction 10: A large, existing online company will enter real estate by creating a consumer-direct portal where people can research all things real estate, read the latest headlines, browse available homes, download legal forms and chat with peers.
Zillow comes close to this description, but not exactly. The company this year launched a real estate service in beta that enables consumers to look up estimated home values and research prices in specific neighborhoods across the U.S. So far, consumers cannot browse available homes for sale at Zillow, but they can track their own home’s value and update the details on their property.
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