Altos Research Real Estate Insights

Inman News hosts its annual Real Estate Connect conference in early August in San Francisco this year. Today they announced the finalists for the Inman Innovator awards.

And guess what, Altos Research is a finalist in the Most Innovative Technology category for our AltosCharts market stats widgets. WooHoo!

It's nice to be recognized. So thanks to the folks at Inman for including us as finalists. Congrats also to our friends at 3Oceans, TransparentRE, Redfin Sweet Digs, Bloodhound, Wellcomemat, and Vflyer for their nominations too.

Incidentally, we've recently rolled out a number of cool features on the AltosCharts. Check these out:

1. AltosCharts Mobile! Get your local market stats live on your mobile phone browser.
2. Comparison Charts - now you can compare multiple markets, stats, timeframes and more in a single AltosChart! Here's an intentionally complex example.

These advanced features are available to all subscribers. Basic AltosCharts are free for your website. Play on!

They say when you age, everything slows down. There's now evidence to say that you home's value is included in that statement.

According to new research from HUD, the homes of people over 75 appreciate at 1-3% less per year than the homes owned by middle-agers.

The phenomenon appears to be determined by a few factors:

• older people = older homes = greater depreciation
• home improvement counteracts home age depreciation, but home improvement activity declines as people age

Full report here.

The fabulous blog fest, the Carnival of Real Estate, finds its way to our humble home today. While we came up short on working out a clever theme (Summer Solstice? 4th of July? Yankees vs. Giants? Gay Pride Parade?) for judging this week's mound of entries, we decided at least to categorize them. Of the many, many dozens of entries, these are the four categories into which real estate writing has seemed to self-organize. We'll highlight the best of each group.

Category	Description
Consumer Real Estate	Advice, lists and insights for home buyers and sellers, borrowers, and searchers
Real Estate Professionals	Thoughts and opinions on the state of the industry, realtors, and the latest industry news
Real Estate Technology	As always, lots of opinions and advice on blogging. This week a bunch of photography related posts. Technology that's changing our business
Greg Swann*	With his three blogs (which basically follow the above categories), dozens of contributors, each with their own excellent blogs, Greg has created an orbit all his own.

First the Technology Category, and our favorite post of the week. Some important thoughts that everyone in this business should be aware of.

1. Jim Cronin at the Real Estate Tomato tackles a deeply nuanced topic that has far reaching implications across the Internet in general. The question of the day in real estate is, Can you blog about other brokers' listings? This innocent little industry-insider topic challenges the legal implications of copyright, the changing nature of competition, and freedom of information. And, if you don't talk to your kids about copyright, who will? Jim tackles the myriad issues admirably, and leaves the mic open for lots of further discussion. Interesting times indeed.

Other cool posts on technology in real estate this week:

1. Cecelia Hutchings on Athol's RE Agent in CT. What consumers want in listings photos and how to take them. Marvelous insights in this post.
2. Also on the photography topic, Aaron Dickinson explains HDR photography and making your listings photos rock. for cheap.
3. Back on the blogging topic, Mary at RSS Pieces talks about when to worry about duplicate blog content and when not to. I recently spoke with Google's Matt Cutts on the topic. His point is "if you're not actively trying to deceive Google or your readers, you're probably not going to be penalized."

Next the Professionals group. Two really great posts, each tackling a different angle on the nuances of being a real estate professional and marketing real estate these days:

1. In typically impassioned Bloodhound Blog style, Greg Swann tackles Real Estate Licensing, and why it's bad for the business. Read this article. The license, no matter what training it requires, is fundamentally anti-intelligence, anti-experience, anti-due diligence. The license not only deludes consumers into thinking that all agents are the same, it permits newly-minted licensees plausibly to make that very stupid claim.
2. Can you name your listing? If Seth Godin or Guy Kawasaki were in the real estate business, they'd have written this post. And it would have gotten 10,000 readers. Instead, Kimberly Wester has it tucked away on Active Rain and you few hundred Blog Carnival readers will benefit. In Silicon Valley, marketing wisdom says, to name a market is to own it. Kimberly points out that naming your listing helps you understand it's strengths and market it better to buyers. Good stuff.

Finally the Consumer Category. Always full of advice, most of it good, the Consumer category does not fail this week. Two posts in particular focus on the consumer implications of the wrenching changes currently happening for regular folks who just want to buy or sell their homes:

1. On the buy-side, Brian Brady shows us important changes in lending laws. In 2007 lenders will be required to report cash-out refinance transactions. This little change is going to result in very different lender behavior. Look out.
2. On the sell-side, Larry in Cocoa Beach has two properties on the banks of denial river for you. Overpricing properties in a cooling market. Ouch.
   

Bonus! Other fun articles to peruse:

• Cliff Jacobson brings us the list of real estate cliches.
• Kris Berg on the collapse of traditional newspaper business and the cat-husband dynamic.
• Jay Thompson explores blogging for clients. The Sellsius boys want to know who does it best.
• Erik Hersman looks into real estate web traffic, finds it flat. Which means all the growth is going to the individual sites like those contributors to the Carnival of Real Estate. Rock on.

The Carnival takes a July 4th holiday next week. It returns at ValleyMarket.com in two weeks.

*just kidding about judging Greg's own category. Not kidding about the significance of his presence in this biz.

In case you missed it, long term interest rates are rising. In some respects this is actually good news. The yield curve, charting interest rates along their maturity duration, is no longer inverted. Recall that an inverted yield curve means short-term rates are higher than long-term rates, an awkward financial state that commonly signals a coming recession. So a positively sloped curve reflects general economic strength. That's the good news.

The yield curve first inverted nearly a year ago. It was a time of pick-your-poison for the housing market. To get "right", either we were going to see recession, where the resulting joblessness would pummel housing demand. Or we'd be faced with rising long term interest rates, making mortgages more expensive and pummeling housing demand.

Well, the economy has spoken. The bears are capitulating one by one, recognizing that the housing market downturn is not sufficient to drive the economy into a tailspin.

Instead we're faced with something much more mundane in the housing market cycle. Higher mortgage rates. Higher rates, coupled with tighter lending from the subprime cleanup. We've had such low rates for such a long time that returning to normal levels will seem like a foreign country. Every upward move in rates makes homes less affordable.

Macro shifts, a declining dollar, protectionism all seem to be lurching us out of the mortgage rate utopia and back to the real world. Time to lock in that 30-year before we get to gasp 7%, methinks.

So many things happening 'round Altos Research World HQ, that the blog has been getting short shrift lately. Here's a roundup:

• Since the silly legal hubub with the Redfin blog, the company has been focusing on helping readers understand market conditions rather individual properties. Kris Newby now has a marvellous series of posts on the Peninsula's local market conditions. It's a style that we've been meaning to do systematically on this blog for years, and she's nailed it. We're glad to help Redfin's blog run wild even as our own child goes shoeless.
• A week ago we were selected the top post in the Carnival of Real Estate by Craig Schiller's Home Staging Rants and Ravings blog. Craig did a fantastic job sorting through the great entries. We got lucky with our heat chart post being judged by a man who lives in color.
• This weekend I'm off to O'Reilly Media's FOO Camp (Friends of O'Reilly). A conclave of alpha-geeks and digerati where I can (am expected to, in fact) expound on nuances of real time real estate market analytics with less risk of the audience falling into conference-coma and more risk that someone's back-of-envelope math blows away years of insight we've developed here.
  
• And somewhere in there we'll have to read and round up this week's Carnival of Real Estate, which we host on this blog next Monday. As an aside, that Drew Meyers at Zillow, who administers the Canival, has done a remarkable job as that company's web 2.0 community champion -- it seems like he's everywhere.
  
• Finally, our colleagues at TFS are bringing their Real Estate Derivatives Seminar to California in July. As we say all the time, these market have huge potential and are very young, so everyone is learning their way around. If you're interested in housing or commercial real estate risk management, this is 2 hours you should invest, meet the other players, examine the trades. San Francisco July 24, 2007 and Los Angeles July 25, 2007. Conact me for details.
  

We've been talking for a while about how the market strength in the Bay Area's housing market has been focused on the economic centers, San Francisco and down the Peninsula, with the market notably cooling the farther you reach into the exurbs.

Thanks to the folks at FortiusOne, who launched GeoCommons at O'Reilly's Where2.0 conference last week, we finally got around to illustrating the heat map of this phenomenon.

In the following snapshot we've created a heatmap of price reductions. Specifically this is our percent-price-reduction stat--for a given zip code, the percent of properties that have had their asking prices reduced. We have some color tweaking to do still, but you can see the picture pretty clearly. The brighter red, the higher the percentage (and the weaker the market).

If we zoom into the San Francisco, San Mateo County Peninsula and the north end of Santa Clara County, you can see the strength in Mountain View, up through Palo Alto, and in the San Mateo/Burlingame areas. Also, demand levels in the City have stayed strong.

You can get details of the markets in Burlingame, San Mateo, Palo Alto, Mountain View etc. on our free research page. From that page, you can go to our map view and look at price trends for each zip code. (Heatmap not yet included.)

As Altos Research has been steadily growing our market coverage, we're making friends and clients in new parts of the country. Here's a quick mention for our Arizona readers to check out Phoenix Realtor Christoph Schweiger's new blog. He's jumped in to the blogosphere with both feet and, in the spirit of some of the blog-judging we've been up to lately, Chris' blog both looks great and reads well. Plus he has a complimentary post about us today, so he deserves all the glowing reviews and links we can give him. As an Altos Research client, Chris has all the market analysis goodies for the metro Phoenix market. Chris, welcome to the blogosphere and welcome aboard as an Altos client!