6. ru 2015 rpr student manual

RPR®: Real-‐Time Data, Market Knowledge, Informed Consumers

Student Manual

©2011 -‐ 2014 by the Realtors Property Resource®. All rights reserved.

Note: The Realtors Property Resource®, LLC, its faculty, agents, and employees are not engaged in rendering legal, accounting, financial, tax, or other professional services through these course materials. If legal advice or other expert assistance is required, the student should seek competent professional advice.

Realtors Property Resource, LLC 430 North Michigan Avenue Chicago, Illinois 60611 USA

Acknowledgments

In practice and in spirit, the development of this program has been a collaborative journey with the goal of providing advanced training and resources for real estate professionals. The Realtors Property Resource® would like to express appreciation to the following individuals for their participation and contributions:

Marty Frame, President, Realtors Property Resource®

Nobu Hatu, Director, Digital Engagement, National Association of REALTORS® Reggie Nicolay, Vice President of Marketing and Social Media, Realtors Property Resource® Karen France, Vice President of Training and Programs, Realtors Property Resource®

Jeff Young, Senior Vice President of Operations, Realtors Property Resource®

Lawrence Yun, Chief Economist & Senior Vice President of Research, National Association of REALTORS®, Washington, D.C.

Contents

Introduction ........................................................................................................................... 1

Course Learning Objectives ......................................................................................................... 2 Course Structure ......................................................................................................................... 2 What Is the Realtors Property Resource? ................................................................................... 4 Test Your AVM Knowledge ......................................................................................................... 6

1. How Much Is This House Worth Today? .............................................................................. 7

What Are AVMs? ......................................................................................................................... 8 Data Issues ................................................................................................................................ 11 Where Does the Data Come From? .......................................................................................... 13 How Do AVMs Calculate Values? .............................................................................................. 14 Are AVMs Really “Free”? .......................................................................................................... 15 Do AVMs Benefit Consumers? .................................................................................................. 16

2. Consumers Don’t Believe Everything They See on the Internet. Right? .............................. 20

Researching the Market ............................................................................................................ 21 Gathering (Mis)Information? .................................................................................................... 21 Same Data—Different Answers? .............................................................................................. 22 How Important Is Right Pricing? ............................................................................................... 24 Practitioner Perspective: Real Time Equals True Value ............................................................ 28 AVMs Meet the Real-‐World Market ......................................................................................... 30 Do These Scenarios Sound Familiar? ........................................................................................ 31 RPR—the Data-‐Supported Reality Check .................................................................................. 33

3. RPR®: Where Data Becomes Knowledge ........................................................................... 34

Free Data, Priceless Knowledge ................................................................................................ 35 RPR Report Power ..................................................................................................................... 38 The Reports Page ...................................................................................................................... 39 RPR Benefits .............................................................................................................................. 40 Knowledge for the REALTOR® ................................................................................................... 41 Knowledge for the Seller ........................................................................................................... 43 Refining Value and Selecting Comparables ............................................................................... 47 Seller’s Report ........................................................................................................................... 51 Knowledge for the Buyer .......................................................................................................... 53 Mapping .................................................................................................................................... 55

Property Report ........................................................................................................................ 58 FSBOs—Never Say “I’ll Get Back To You” Again ........................................................................ 60 Knowledge for Your Network .................................................................................................... 61 Market Report ........................................................................................................................... 62 Neighborhood Report ............................................................................................................... 63

4. RPR®: A Win for Consumers and REALTORS® ..................................................................... 65

RPR Coverage Map—December 2014 ...................................................................................... 66 The Power of RPR Tools ............................................................................................................ 67 RPR Reports in Action—3 Scenarios ......................................................................................... 75 RPR Reports Help Distressed Properties ................................................................................... 78 Using Information Responsibly ................................................................................................. 79 RPR Mobile ................................................................................................................................ 81 BPOs and RPR Grow Your Income ............................................................................................. 83 The Broker Tool Sets ................................................................................................................. 84 RPR Commercial ........................................................................................................................ 84

Resources ............................................................................................................................. 87

Need Help? RPR Help Desk 24/7/365 ....................................................................................... 88 The RPR All-‐Star Team .............................................................................................................. 89 Technical Requirements for PC and Mac .................................................................................. 89 Websites ................................................................................................................................... 90 Authorized RPR Website User Access Policy ............................................................................. 92

1

Introduction

AVMs, RVMs and Showing Consumers the Difference

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Course Learning Objectives The goals of this course are to educate real estate professionals on the following:

! The real estate market research and valuation tools that consumers can access online.

! The pros and cons of automated valuation models (AVMs); how they obtain and calculate data.

! How RPR tools help real estate buyers and sellers make informed decisions.

! How REALTORS® can combine their specific expertise with RPR-‐enhanced MLS data, tools, and reports to benefit clients and customers before, during, and after the real estate transaction.

Course Structure 1. How Much Is This House Worth Today?

The opening chapter focuses on the origins and uses of automated valuation models (AVMs). We’ll look at what the leading online AVMs can and can’t do and how the Realtors Property Resource® tools close the accuracy gap between automated estimates and market realities.

2. Consumers Don’t Believe Everything They See on the Internet.

Right? In this chapter we’ll look at how over-‐reliance on some AVMs can lead consumers into decisions that take a big bite out of their wallets—either as higher house payments or lower sale proceeds. When AVMs under-‐ or overestimate home values, real estate professionals must explain the inaccuracies before they can present reliable information about market conditions and pricing.

3. RPR: Where Data Becomes Knowledge

Market data isn’t market intelligence. Price trends cannot describe the experience of living in a home and neighborhood. This chapter demonstrates how REALTORS® can combine their expertise with RPR reports to help consumers make informed decisions.

Introduction

3

4. RPR—a Win for Consumers and REALTORS® This chapter focuses on extending the value of RPR reports beyond the transaction. The reports offer a powerful prospecting tool for staying top-‐of-‐mind with potential customers and clients as well as keeping them informed about market trends.

A Note About Trademarks

The following terms are trademarked:

! Realtors Property Resource®

! RPR®

! Realtors Valuation Model®

! RVM®

! RPR Mobile™

Although REALTOR® is a trademarked term on its own, federal regulations do not allow incorporation of a trademark within a trademark. Therefore, the word “Realtor” appears in lower case and without its usual trademark symbol. It is important to note that the RPR® trademarks in no way weaken the protection of the term REALTOR® as a registered trademark.

Throughout this course, the above terms appear without trademark symbols for ease of reading.


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What Is the Realtors Property Resource? The Realtors Property Resource was launched in 2010 with the goal of creating an online real estate library that provides REALTORS® with data on every property in the United States. As its core mission, RPR reinforces the value REALTORS® bring to the transaction by keeping them ahead of the technology curve and better able to serve today’s technology-‐empowered consumer.

This initiative relies on the collaborative efforts of REALTORS® and the real estate community, including brokers, MLSs, and associations. As a wholly owned subsidiary corporation of the National Association of REALTORS®, RPR has no stockholders, no partners, and no outside investors. There is no public or consumer access or any feeds to third parties.

RPR opens access to a national database of robust property information on more than 166 million properties. RPR tools aggregate all available data on a property, such as tax assessment and public record information, notice of default, REO, foreclosure and pre-‐foreclosure data, MLS/CIE-‐provided information, zoning, liens, permits, school districts, flood plain maps, demographics, and much more. In fact, RPR has the largest database of foreclosure information in the industry.

As we’ll see throughout this course, the factor that distinguishes RPR from other real estate websites is integration of localized MLS active and off-‐market data. RPR gives REALTORS® the tools to help their clients and customers make informed real estate decisions—even in challenging markets. It’s also important to know what RPR is not; it is not a national MLS and carries no offers of cooperation and compensation.

Introduction

5

Stay Up-to-Date with the RPR Blog—http://blog.narrpr.com


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Test Your AVM Knowledge

Test your knowledge of AVMs and the REALTORS® Property Resource. Mark the best answer. 1. Realtors Property Resource is member benefit of the National Association of

REALTORS®. True False

2. AVMs are usually categorized as public domain or governmental. True False

3. Some online real estate AVMs make money by selling advertising. True False

4. Fannie Mae and Freddie Mac use AVMs to evaluate loan portfolios. True False

5. RPR can produce market trend reports. True False

6. AVM value calculations are accurate enough to substitute for appraisals. True False

7. All AVMs have access to the same data. True False

8. County tax assessors seldom use AVMs. True False

9. AVMs calculate value, not sales price. True False

10. AVMs can be used to detect mortgage fraud. True False

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1. How Much Is This House Worth Today?


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What is my house worth today? Considering the ups and downs of real estate markets in the last few years, it’s a top question for both homeowners and buyers. Homeowners wonder if their homes have lost value and equity, or if they are underwater with their mortgages. Buyers try to anticipate the market and weigh if they are paying too much or getting a bargain. Where do they look first for answers? NAR research shows that 43 percent of buyers research markets and properties online.1 Online home-‐value estimators, known as automated valuation models (AVMs), offer quick answers but data limitations reduce their accuracy. And, although AVMs have access to the same databases of public records, their methods of value calculation—called algorithms—produce different results.

In this module, we’ll look at how AVMs have evolved, what the leading consumer AVMs can and can’t do, and how RPR tools close the accuracy gap between automated estimate and market reality. RPR’s ultimate value is this: real estate buyers and sellers can make better decisions because REALTORS® have better tools and local market expertise to help their clients and customers.

What Are AVMs? A real estate automated valuation model is a computer software program that combines data such as assessed value for taxes and sales data, to calculate a value for a property and, in some cases, predict market trends.

AVMs started as a business tool to minimize the operational costs and improve efficiency in keeping track of real estate assets. County tax assessors, high-‐volume lenders, and Freddie Mac were among the first users of AVMs. Budgetary constraints, personnel limitations, and the scope of real estate holdings necessitated development of computer software to automate property valuations.

Commercial AVMs

Lenders and investors use commercial AVMs to manage their portfolios of loans and properties and keep tabs on asset values. Depending on the sources of data and the method—the algorithm—used to combine and 1 Profile of Home Buyers and Sellers 2014, NATIONAL ASSOCIATION OF REALTORS®, www.realtor.org/research.


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weigh factors, the model can predict trends and compare investment values.

For lenders, the programs save time and money when a full appraisal isn’t necessary. For example, a bank might use an AVM for evaluating a home equity line of credit application. In this case, the creditworthiness of the borrower is a bigger factor than the accuracy of the valuation.

AVMs offer a quality assurance measurement. The lender can compare the track records of appraisers and the historic performance of the AVM to actual sales prices to benchmark accuracy. On a larger scale, AVMs provide a quality assurance measure when financial institutions sell or purchase pooled loans. AVMs also help detect scams like collateral fraud (overvaluing of a property), flipping that involves straw buyers or inflated prices, and builder bailout schemes. Sales prices that differ significantly from the model’s calculations raise red flags.

Commercial AVMs Realtors Valuation Model® Consumer AVMs

" Freddie Mac: Home Value Estimator

" Veros: VeroValue

" Fiserv: CASA

" First American: Home Price Analyzer

" CoreLogic

An exclusive member benefit for REALTORS®. Market intelligence on over 160 million parcels of property in the United States.

" Chase Home Value Estimator

" Eppraisal " HomeGain " Homes.com " Property Shark " MSN Real Estate " RealEstate.com " Trulia " Zillow®


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S AM P LE

Reprint courtesy of Freddie Mac, www.freddiemac.com/hve


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Government Use of AVMs

Freddie Mac was an early adopter of AVM technology. It has used its in-‐house Home Value Explorer for more than 15 years to monitor the bulk real estate portfolio. Fannie Mae’s Desktop Underwriter® system uses a proprietary AVM to assess risk and generate recommendations on inspection options. The Fannie Mae model actually compares the values generated by other AVMs.

Consumer AVMs

Consumer-‐facing AVMs evolved from commercial applications. Tapping into consumer curiosity about home values, Internet entrepreneurs combined AVM technology, drawing on public records, with web-‐based business models. Zillow’s Zestimates® and Trulia were early launches and are generally regarded as the leading consumer-‐facing AVM websites. The estimates, however, tend to have a variable margin of error. All of the AVMs caution the consumer that the quoted values are estimates and cannot substitute for an appraisal.

Data Issues Reliance on public information presents two critical data issues: timeliness and availability.

! Timeliness: There is often a significant time lag involved in reporting property transactions.

! Availability: Where there is an abundance of sales of similar properties within a market area, AVMs tend to score high on accuracy. Conversely, a lack of data decreases accuracy. In some parts of the country, the sales price of a property is not public information.

How Do AVMs Measure Accuracy?

! Precision: Accuracy is expressed as a percentage, such as “within 10 percent plus or minus of the actual sales price.”

! Reliability: Accuracy is measured by how often values fall within a specific range, such as “within 10 percent plus or minus 75 percent of the time.”


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! Validity: A measure of confidence in the model’s capability over time.


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Where Does the Data Come From?

Mortgages & Liens

MLS Data

Insurance Claims

School Districts

Defaults & Foreclosures

Reported Sales

Property Tax Records

GIS Census Data

FEMA Flood Maps

Property Characterisbcs

Transportabon Stabsbcs

Crime Stabsbcs

Climate Data

Points of Interest

Environmental Data

Both commercial and consumer AVMs draw data from public records like reported sales, property tax assessments, mortgages and liens, school boundary lines, and so forth. In addition, some MLSs augment revenues by licensing their data to commercial AVMs used by lenders and appraisers.


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How Do AVMs Calculate Values? If all of the models use the same data sources, how do they distinguish themselves from competitors? AVMs use proprietary algorithms to consolidate the data and assign weighted values to the components. The algorithm is a closely-‐guarded, patented trade secret because it represents the vendor’s edge over the competition.

Three Types of Automated Valuation Models

Hedonic Indexed Blended

The hedonic model assigns a value to each property characteristic and then totals component values.

The indexed model calculates value based on sales trends of comparable properties.

The hybrid model combines hedonic and indexed models.

There are three basic model types: hedonic, indexed, and hybrid.

! Hedonic models assign a value to each component (bedrooms, bathrooms, lot size) and sum up the values of individual components to construct a composite value—the sum of the parts. The hedonic model doesn’t consider the sales prices of comparable properties. Freddie Mac uses a hedonic model as an internal measurement tool to assess the value of their loan portfolio.

! Indexed models calculate values based on sales prices of similar properties, but do not consider the specific characteristics of a property.

! Blended models combine the hedonic and indexed models by using both property characteristics and comparable sales to calculate value.


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Blended models may assign more weight to sales statistics and trends than property characteristics.

In the context of this course, the important point is this: blended models tend to be more accurate than hedonic or indexed approaches because they use a richer data landscape.

The RPR Model

The RPR valuation model uses a blended approach to calculate value; it uses property characteristics, sales history of comparable properties, and real-‐world MLS pricing information. In addition, the model allows

REALTORS® to fine-‐tune values of specific properties based on their firsthand knowledge of property conditions. Furthermore, the RPR model not only blends other model types, it improves accuracy by adjusting the weighting of its component models and variables. The target audience also makes the RPR model a hybrid approach; its users are commercial enterprises—real estate brokerages—but the ultimate beneficiary of its output is the consumer.

Are AVMs Really “Free”? Would you be surprised to learn that the market for “free” data is a multi-‐million-‐dollar enterprise? Commercial AVMs may offer their service to businesses on a subscription or license basis or charge a per-‐report fee. The commercial-‐facing AVMs sell reams of property valuation reports to lenders and investors.

If consumer-‐facing AVMs offer a free service, do these websites make money? Consider that Zillow® launched an IPO on the NASDAQ in July 2011; opening share price zoomed upwards from $20 to $60 before settling into a lower trading range2. The websites make money through advertising, click-‐through ads, and, in some cases, selling leads to real estate professionals. Paying for leads on their own listings is an understandable sore point with brokers.

2 “Zillow IPO Zooms 79%,” Wall Street Journal, July 21, 2011. www.wsj.com.


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In 2011, NAR made the decision to fully fund RPR as a dues funded, member benefit for all REALTORS®. RPR’s licenses with partnering MLSs authorize it to create RPR Products. One of these products, the Realtors Valuation Model (RVM), is a derivative calculation—a single line of data—that is offered to lenders and the GSEs (Freddie Mac and Fannie Mae), for their internal use in data calculations. The single line of data, the RVM, is more accurate than other AVMs because it is based on real-‐world MLS pricing information. Lenders and the GSEs need accurate valuation data about their real estate holdings and loan portfolios in order to make business decisions; they recognize the value of the RVM’s output and are willing to pay a fee to obtain it. The RVM value is pulled into the lenders’ existing reports.

Do AVMs Benefit Consumers? Despite their drawbacks, consumer-‐oriented AVMs do provide a consumer service. The models offer consumers a quick, convenient, anonymous price estimate at no cost. For the seller or buyer who is just testing the water before initiating a move, AVMs offer a first indicator of market expectations.

Of course, the AVM can never encompass the many aspects of a property that impact the sales price. Nor can an AVM replace the knowledge, experience, and judgment of an experienced real estate professional or appraiser.

The models assume that the property is in average condition; there is no adjustment upward for improvements or downward for needed repairs. Automated comparable sales figures make the same assumptions about comparison properties. But real estate professionals know that the sales prices of nearby properties may be higher or lower depending on property condition, market anomalies like a large inventory of foreclosures, and the time lapse since the last sale.

Another weak point for consumer AVMs is that the models calculate value—not sales price—which is an important distinction. As any real estate professional will attest, a wide gap can occur between the market value, based on comparable sales, and what a buyer is willing to pay for the property. One study found that the leading AVM, Zillow’s Zestimates®, tends to overvalue properties more often than undervalue them. The same study also found that consumers tend to overestimate the value of their homes by an average of 10 percent, a miscalculation


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reinforced by online AVM estimates.3 Because AVMs like Zillow® rely on sales data, accuracy is better in an active market in a full disclosure state where there are many similar properties in average condition.

The fact is that some properties are not well suited for the AVM just-‐the-‐facts approach. Characteristics like historical value, over-‐sized lots, and scenic views won’t show up as value determinants.

RPR—the Realtor Valuation Model and More

Just as AVMs cannot judge the condition of a home, they cannot evaluate or value the intangible factors that go into marketing or buying a home. Experienced real estate professionals know that price is only one of the

parameters involved in the home search. Although buyers may use price to identify homes for viewing, they don’t buy price. Buyers choose a home based on the anticipated experience of living in it and its

environs. And that is where RPR’s Realtor Valuation Model gives REALTORS® the competitive edge over consumer-‐facing AVMs.

The RPR model overcomes the critical data issues that beleaguer AVMs:

! Timeliness and availability: The pricing information produced by RPR uses real-‐world MLS data.

! Accuracy: Using RPR’s tool sets, REALTORS® can refine a value to reflect the property’s actual condition and select the comparables that produce a valid comparison.

The system not only overcomes these common data challenges, it enriches the data with lifestyle information. The result is a picture that goes beyond the numbers and provides consumers with knowledge for making decisions. And, as REALTORS® work with the system and continually refine values in their market area, the system remembers and gets smarter. We’ll look more closely at the details of how this happens later in the course.

? Discussion Question

3 Corcoran, Charles, PhD, CFA; Liu, Fei. Accuracy of Zillow's Home Value Estimates, Real Estate Issues 39.1 (Spring 2014): 45-‐49, 2-‐3, 6.


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What are your experiences of online consumer-‐facing AVMs?


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Next Chapter

In this chapter we looked at the development of commercial and online consumer AVMs. Despite the drawbacks, the consumer sites do offer a quick, convenient, no-‐cost estimate of property values. But, as we’ll see in the next chapter, aligning the consumers’ expectations, based on online AVM estimates, with market realities can present challenges for the real estate professional.


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2. Consumers Don’t Believe Everything They See on the Internet. Right?


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Researching the Market How did buyers and sellers learn about home values in the pre-‐Internet days? Of course, they could call a real estate agent or appraiser. But what if they were just curious or scoping out the market? They could ask neighbors, visit open houses, or scour newspaper ads.

Now buyers and sellers can access a dizzying number of websites for listing information and value estimates, including the values of their own as well as their neighbors’ homes. Today’s real estate consumer is more plugged in and informed than ever before, but some would say they are also more distracted by real estate (and non-‐real estate) sites competing for attention in the online space.

Gathering (Mis)Information? NAR research shows that both buyers and sellers spend time researching online before contacting a real estate agent. Although consumers see a lot of information about property prices, market trends, and transaction facts, the hours spent online also allow plenty of time for misperceptions to develop.

Media coverage can further distort the picture. It’s true that many areas that saw sharp run-‐ups and churning are now in market doldrums. Other markets, however, have stabilized and are holding their own. Despite all of the doom and gloom in the media, nationwide, the median time on the market is 4 weeks and 40 percent of homes are sold within 95 percent or better of list price. Would you be surprised to learn that 92% of the homes that sold within one week had no price reduction?4 The numbers in the charts on pages 25–26 illustrate the importance of pricing right—something that most consumer AVMs cannot do effectively.

Real estate professionals come face-‐to-‐face with market misperceptions at listing presentations and buyer counseling sessions. Before presenting reliable information about market conditions and pricing, the real estate agent must spend time explaining AVM values and limitations, and why they can be so far off the mark—high or low.

4 Ibid.


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Same Data—Different Answers? Have you ever had the experience of witnessing an event like a car accident? The conflicting versions of others’ eyewitness accounts can leave you wondering, “Didn’t we all just see the same thing?” The wide range of values calculated by consumer AVMs is not unlike this situation. Everyone supposedly saw the same event—the same sets of data—but the conclusions drawn from that data vary widely. Just how much variation is there between AVMs? Let’s try comparing the range of estimates quoted by some of the leading consumer AVMs for the same home.

! RPR Property Report: estimated price $462,169

! Trulia: $419,088

! Chase Home Value Estimator: $309,000

! Zillow®: $238,731

! AOL: $218,910

! Bank of America: $209,500

How Do They Get Away With Inaccuracy?

You may be thinking, “How can AVMs get away with being inaccurate?” Well, they really don’t risk anything by quoting home values that are off the target of current pricing. Consumer-‐facing sites have two goals—capture leads and draw traffic to advertisers.


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Disclaimers and accuracy ratings on AVM websites caution viewers that the estimates are a starting point and should not be taken as an appraisal. The Realtors Valuation Model is a starting point too. The difference is that AVMs expect consumers to work with professionals such as appraisers for more accurate value assessments. The RVM, on the other hand, gives the REALTOR® the tools to apply their skills to fine-‐tune values, make logical selections of comparable properties, and develop pricing strategies.

AVM websites know their accuracy rates are low because the data is limited or non-‐existent; some states don’t allow reports of sale prices. For example, Zestimate®, the most popular consumer AVM, publishes details on the accuracy of its valuation calculations. Remember the discussion in the preceding chapter on how AVMs measure accuracy? Zestimate® quotes the percentage of values within 5, 10, and 20 percent, a one to four star accuracy rating, and a median error rate. Zillow® also distinguishes between “homes on Zillow®” for which only public record data is available and “homes with Zestimates®” which are homes with transaction data available. Zillow® states that it has data on 110 million homes.

Essentially, the consumer AVMs try to estimate current value by looking at stagnant data. Sales data is static; it is recorded once and doesn’t change as the market surges or ebbs. If several years have elapsed since the last transaction or there are few sales of similar properties, the estimated value can fall quite wide of the mark.

Of course, accuracy increases with more sales data available in an area. Accuracy drops where there is a dearth of reported transactions. For example, sales data is not publicly reported in the following nondisclosure states:

" Alaska

" Idaho

" Indiana

" Kansas

" Louisiana

" Maine

" Mississippi

" Missouri

" Montana

" New Mexico

" North Dakota

" Texas

" Utah

" Wyoming


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Consumer AVMs, like Zillow®, may not produce a value estimate in these nondisclosure states.

In addition to the issue of old or missing data, foreclosures, short sales, and REOs can further skew a market in terms of both pricing and inventory. AVMs that rely on sales records do not weed out these market aberrations. Nor do they adjust for the condition of the market or the property. In the next chapter we’ll see how RPR tools allow the real estate agent to identify and isolate distressed properties when selecting comparables. Flagging distressed properties helps sellers see the pricing and inventory of competing properties.

How Important Is Right Pricing? Rationalizing price is the number one problem for sellers. Sellers tend to overestimate the value of their properties, as do some consumer AVMs. Some sellers can’t accept the price declines of the past few years. On the flip side, there are buyers who are still seeking the market bottom before making a move. Real estate professionals must help sellers understand that regardless of how much they think the home is worth, the market sets the price.

Real estate professionals can help sellers understand that buyers shop for homes for 2–3 months and have a lot of time to compare homes on the market. If a home has been on the market for some time without any offers, it’s clearly trying to compete in a price range where buyers have other, better choices. There is some anecdotal evidence that buyers will pass up an overpriced property because they don’t want to offend the sellers by making a low offer.


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Real estate agents can’t take the risk of proposing fuzzy pricing to clients and customers. Incorrect pricing leads to severe consequences for both buyers and sellers: a home languishing on the market, price cuts, below-‐expectation sale proceeds, or for the buyer, overpaying.

Bottom line—the market sets the price. But a price or an offer based on good data helps buyers and sellers feel some control over the process and confirmed in making or accepting or rejecting an offer. Over-‐reliance on consumer AVMs could lead consumers into decisions that take a big (unnecessary) bite out of their wallets—as higher house payments, lower sale proceeds, or more time on the market.

Sales Price as a Percentage of List Price, Time on Market

Sales price as % of list price

% homes sold in 1 week

% homes sold in 5–8 weeks

% homes sold in 9–16 weeks

% homes sold in 17+ weeks

Over 100% 22% 6% 3% 2%

100% 48% 10% 12% 5%

95–99% 17% 53% 42% 34%

90–94% 4% 21% 29% 30%

Under 90% 6% 8% 14% 27%

Price Reductions

1 Reduction: 7% 2 Reductions: 11% 3-‐4 Reductions: less than 1%

1 Reduction: 36% 2 Reductions: 15% 3-‐4 Reductions: 4%



Source: Profile of Home Buyers and Sellers 2014, National Association of REALTORS® Research

Nationwide median 4 weeks


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How Many Days On Market? How Close to List Price?

South Sales price as a percentage of list price

§ 10% of homes sold for less than 90% of list

§ 18% sold at 90–94% of list § 39% sold at 95–99% of list § 23% sold at 100% of list § 8% sold at more than 100% § Median sales versus list: 97% § Median weeks on market: 4 weeks § 31% of homes sold in under 2 weeks

West Sales price as a percentage of list price

§ 6% of homes sold for less than 90% of list § 13% sold at 90–94% of list § 37% sold at 95–99% of list § 26% sold at 100% of list § 14% sold at more than 100% § Median sales versus list: 98% § Median weeks on market: 3 weeks § 40% of homes sold in under 2 weeks

Midwest Sales price as a percentage of list price



Northeast Sales price as a percentage of list price



Source: Profile of Home Buyers and Sellers 2014, National Association of REALTORS® Research


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What Do Buyers Do? Source: Profile of Home Buyers and Sellers 2014 National Association of REALTORS® Research

% of buyers who use the Internet frequently to search for homes

88% of buyers who search on the Internet also contact a real estate agent as an information source

What do buyers do after searching on the Internet? 98% of buyers who search on the Internet purchase through a real estate agent.

Where buyers who search on the Internet find the homes they buy? 43% Internet 33% Real estate agent 9% Yard sign/Open house 6% Friend, family, neighbor 5% Home builder 1% Newspaper ads

64% Walk through a home viewed online

76% Drive by the property

26% Find the agent

Length of search and number of homes viewed How many weeks do buyers search?

West 10 weeks 10 homes

Midwest 10 weeks 10 homes

South 10 weeks 10 homes

Northeast 12 weeks 10 homes

57% 59% 66% 69% 76% 74% 75% 79% 81% 80%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

8

8

8

10

12

12

12

12

12

10

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014


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Practitioner Perspective: Real Time Equals True Value

The old saying goes, “All real estate is local.” That’s still true but here’s what’s different today—access to real estate information is universal. With the current generation of AVMs and aggregators anyone, anytime, anywhere can look at the same property and valuation data.

Usually in the first qualifying phone call or appointment with sellers, I would ask, “Where are you going to find information about the market and selling or buying a home? What steps are you taking to keep yourself informed?”

I often had to educate or re-‐educate clients about valuation sites. I explained that an online estimate is a good starting point but inaccurate because the data isn’t

real time. The houses that sold in the neighborhood yesterday, or last week, or even last month, didn’t show up in the data. I remind clients that these companies are technology companies first and real estate companies second. For example, when owners go to Zillow® and tweak their property data themselves, those click-‐throughs are recorded and sold to advertisers.

Sellers tended to latch onto the app that quotes the highest price. If that estimate was higher than the market will go, I suggested taking a look at the MLS data on pricing and time on the market. I tried to help them understand that pricing right for a quick sale was more important than ever and reminded them that they didn’t want their unsold home to be the “bad comp” others use for comparison.

If they insisted, I might say “Let’s try it at that price for a couple of weeks and then reduce the price to where I think the market is telling us it should be.” In cold climates like Minnesota, winter weather conditions have a big impact on property sales. I might ask, “With winter coming on, how do you feel about your home staying on the market until spring?”

Bottom line, the explosion of online real estate information makes our role more valuable than ever. In addition to helping clients and customers understand the transaction process, we can serve as informed guides and interpreters and prove our expertise. I brought my head and heart—my knowledge and experience—to the transaction and that couldn’t be automated. I sometimes joked with clients, “When did anything automated work perfectly every time?” Nobu Hata was formerly a REALTOR® with Edina Realty in Minneapolis, Minnesota

“All real estate may be local, but access to real estate information is universal.”

Nobu Hata Director, Digital Engagement National Association of REALTORS® [email protected]


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Read the Practitioner Profile on the preceding page. How do the experiences of this REALTOR® compare to your own?


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AVMs Meet the Real-World Market Real estate professionals come face-‐to-‐face with AVM estimates when they work with sellers and buyers. The education process of aligning the expectations of clients and customers with market realities involves explaining the pros and cons of consumer AVMs.

For the Buyer

Real estate professionals know that price sets the search parameters, but doesn’t make the final decision when it comes to choosing a location or a particular home. The websites can never replace the real estate agent’s knowledge, experience, and market wisdom. Price estimates alone communicate neither a comprehensive picture of market conditions nor the value proposition of the home and certainly not the experience of living in the home and the neighborhood.

During the counseling session, ask buyers what websites they consulted and how they are tapping into information about the buying process. Ask if they are comparing online estimates with current prices.

For the Seller

A wide gap between online value estimates and real-‐world prices can undermine the agent’s creditability. What if the agent proposes a price below what the seller thinks the home is worth? The seller may think the agent is underpricing the home for a quick sale or doesn’t understand the features and value of the home.

The real estate professional must clear away the noise of online value estimates and educate, or re-‐educate, the client about market realities. Take the time, before going on a listing appointment, to find out how consumer AVM sites like Zillow® estimate the value of the property. The sellers probably have already done so.

Ask the seller, have you done much research about home prices or how to sell a house? What are some of the important things you found out? What price range do you think your home is in?

For a reality check, consider including in the CMA an example of an overpriced property. Show its history in terms of days on the market, price reductions and expired listings.


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Do These Scenarios Sound Familiar? ! All of the websites say our home is worth more than the price you

recommend. Another sales agent we spoke with agreed. We want to get the most we can, so we’re thinking about listing with him.

Response: Let’s take a look at what’s happening in the market right now. Your home is certainly a cut above many others, but the sales of comparable properties I’ve shown you were similarly superior. Based on what you’ve seen online, do you think buyers will pay more than the last sale?

I would never want to criticize another agent, but some are so eager for a listing they’ll tell you what you want to hear. If you really feel strongly, we can try it at the higher price for a couple of weeks and plan a price reduction strategy if it doesn’t sell in that time frame.

! It’s amazing to see all of the information these websites publish online. Isn’t that an invasion of privacy?

Response: The websites use information from sources that have always been open to public view. The difference is that the Internet makes it more publicly available. As a REALTOR®, I follow a Code of Ethics. My duty to you as a client is to maintain confidentiality. You can be assured that any confidential information (i.e. not publicly reported) you share with me will stay private.

! If all of these sites use the same public information, how can they come up with such different estimates?

Response: These sites combine public record data and use it to calculate a value by means of proprietary formulas, called algorithms. They weigh and combine factors differently, hence the difference in estimates. Keep in mind that the data they use can be fairly out of date like past sales which may have been reported years ago and property tax assessed values.


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! The _______ website I looked at says my home is worth $350,000. That’s the best price to list it at, right?

Response: That website, like others, attempts to estimate value, not predict market price. Our market is in a transition period and the data that most site use can’t keep up.

! The _______ website says homes in the neighborhood are worth less than these list prices. With the market so down, aren’t these homes overpriced?

Response: Real estate is hyperlocal and the homes in this neighborhood have everything going for them in terms of location, lot sizes, and upgrades. Sellers in the area are generally not in the type of distressed situations that cause properties to sell at discounts. Frankly, homes in this area don’t come on the market that often and sell fast when they do. Do you believe a seller would accept less than the last sale of a similar home? The websites you’ve seen rely on sales transactions that may be years in the past.

! I typed in “how much is my house worth” in the Internet browser and you wouldn’t believe how many hits I got. Which of these is the best website?

Response: Remember, these are primarily technology companies. Their goals are to capture leads and sell click-‐through advertising. They really don’t have anything at risk if their estimates are off target.

! We’ve done a lot of work in our home. Why doesn’t that show up in those home value estimator sites?

Response: Value estimator sites look at past sales data in the aggregate. It can’t refine the value of a particular home because it doesn’t have that information. A couple of sites do invite you to tweak the data on your own home, but they do that basically to collect your data and record the click-‐through information for sale to advertisers.


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RPR—the Data-Supported Reality Check The Realtor Valuation Model was developed specifically for use by REALTORS® in order to identify, visualize, and convey accurate, up-‐to-‐date market information and trends.

The RPR tools accomplish this by combining home information with MLS information and public records such as notices of default, REOs, pre-‐foreclosures, and foreclosures, school districts, flood maps, demographics, and more. RPR positions REALTORS® ahead of the technology curve and reinforces their value as local market experts with detailed, professionally produced, and hyperlocal reports.

Next Chapter

Home buyers and sellers now spend extended time on the Internet educating themselves about properties and markets before contacting a real estate agent. The amount of data is vast but chaotic. In the next chapter, we’ll look at how RPR’s valuation model and reports provide tools to connect buyers and sellers with the realities of the marketplace. We’ll get down to the nuts and bolts of how REALTORS® can use the RPR tools to better serve their clients and customers as well as compete in today’s data-‐and-‐technology-‐saturated environment.


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3. RPR®: Where Data Becomes Knowledge


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How does today’s consumer start the process of selling or buying a home? Both buyers and sellers spend time educating themselves about home prices, properties, and markets before contacting a real estate agent. NAR research shows that almost 90 percent of homebuyers search online.5 And, data is everywhere—including iPads and smartphones while driving around neighborhoods. Real estate websites flood the Internet with information about home buying and selling. But what does it all mean and how can a buyer or seller wade through all the data to make good decisions?

Figures can show price trends up and down, but can’t inform the viewer about the underlying causes. For example, why are home prices in a particular market area increasing or decreasing? Why do some homes sell quickly while others linger on the market for months? Furthermore, price trends alone cannot describe the experience of living in a home and a neighborhood. Market data becomes knowledge when it is imbued with meaning and placed within a context of place and time.

In this chapter we’ll learn how the RPR searching, mapping, and reporting capabilities assemble and organize a wealth of data and create the meaningful context that connects the data with the concerns and questions of home sellers and buyers.

Free Data, Priceless Knowledge When REALTORS® combine their expertise with RPR reports, consumers have the benefit of both objective data and the real estate professional’s expertise and evaluative input. Everybody can do a better job of weighing options and making decisions. Using RPR tools, REALTORS® can generate a variety of reports to share with clients and customers.

As we learned in the preceding chapter, reliance on data like tax assessment records and past-‐sales reports makes many consumer AVM websites look backward for pricing information. A time lag in reporting further diminishes the accuracy of these value estimates. It’s somewhat like trying to drive a car by looking in the rearview mirror.

It’s true that the RPR valuation model uses public records. But the timeliness of MLS data gives it a “today’s market” view of values, prices, and market activity. Remember, past-‐sales information is static; it is

5 Profile of Home Buyers and Sellers 2014, National Association of REALTORS®, www.realtor.org/research.


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recorded once after of the transaction. Some public records still exist on paper and transaction information may not be publicly reported. MLS data, on the other hand, is real-‐world pricing and market information continually updated throughout the day.

RPR® Reports Help Buyers and Sellers

Property Report

Helps the buyer choose a property and formulate an offer. Provides prelisting appointment information for the REALTOR®.

" Presents a detailed look at a property " Details tax assessment and legal information " Recaps sales and financing history " Presents local market statistics and neighborhood demographics

" Shows listing activity including foreclosures Primary audience: For the Buyer

Seller’s Report

Helps the seller make a decision about listing and pricing a property.

" Reviews the property " Shows local market conditions " Compares similar properties side-‐by-‐side " Recommends a pricing strategy " Estimates sale proceeds " Adjusts value based on comparables and home conditions

Primary audience: For the Seller

Market Activity

Report

Helps buyers and sellers form realistic expectations about the local market.

" Summarizes changes in the local market " Lists of active, pending, sold, expired where MLS data is available and distressed properties

" Shows history of price changes " Informs of upcoming open houses Primary audience: For the Buyer and Seller


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Mini-‐Property

Report

Helps the buyer with a concise look at an individual property.

" Includes a property summary and home facts, legal description

" Current listing photos (when the property is an active listing)

" Local market statistics Primary audience: For the Buyer

Neighborhood

Report

Helps the buyer understand the neighborhood.

" The report includes charts and statistics about the housing, people, economics and quality of life of the neighborhood.

Primary audience: For the Buyer

Valuation Workbook

The Valuation Workbook summarizes the evaluation made using the Sales Comparison Analysis. It includes details about the subject property and the comps and adjustments made in the workflow, as well as an overview of local housing market conditions.

" Comparative Analysis helps agents generate a price range for a property by integrating comps and market information with knowledge of the property and the neighborhood. Sales Comparison Analysis is a more detailed property evaluation, similar to what an appraiser might conduct. The key difference between the workflows is the extent to which the REALTOR® can adjust the property and comps information.

Primary audience: For the Buyer


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RPR Report Power

! MLS data MLS data is real-‐world, forward-‐looking, and refreshed frequently. Public data, which looks backward, is only as up-‐to-‐date as the input.

! Quick report generation The wait time from the click on “get report” to “ready to download” is a minute or two and you can continue working while the report is assembled in the background. An average RPR user spends about 20 minutes per session three times a week in searching, mapping, and creating the custom reports.

! Professional presentation Reports are preformatted with professionally designed page layouts, color charts and graphs with explanatory captions, photos, and both aerial and street maps.

! Personal and company branding Personalization options include your photo, logo and tagline, contact information, and a personal message for the report recipient. The Broker Tool Sets add location-‐specific contact information for company affiliate services like mortgage origination, title, and concierge services.

! Delivery options “Display now” delivers the report in a downloadable PDF format for printing and saving. The option to email to the client or customer and CC yourself sends a link to the report available, as a PDF, online. The link is live for 30 days, but the report can be downloaded and saved.

! Comprehensive but hyperlocal The reports not only bring together a lot of info from a wide span of sources, they also enable the agent to get down to neighborhood specifics like schools.

! Add in your own knowledge No one knows the neighborhood like the agents who farm it. The RPR Property Report lets agents pick the best comps as well as refine the value and features of a specific property. When REALTORS® combine their expertise with RPR reports, the result is meaningful knowledge that helps consumers evaluate their options, whether buying or selling, and make better decisions.


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The Reports Page The Reports Page is the starting point for selecting the type of report and personalizing it with your branding. Input the property address and then select the type of report and property details.


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RPR Benefits The focus on the housing market has been heightened in the past decade due to both the ride up during the bubble years and the painful fall in the subsequent housing recessionary years. The resulting volatility has brought keener interest to the proper assessment of market conditions. Home buyers, home sellers, real estate practitioners, bond investors, Wall Street players, and government policymakers all want to know what is happening in the market in as close to real time as possible. As a result there are naturally more competing organizations providing real estate market data and analysis. Unfortunately, one firm may be good at providing foreclosure data, while another may be good with property deed records—most firms will develop a specialty as a matter of course.

Fortunately, Realtors Property Resource aggregates all the pertinent information, from neighborhood demographic data to property level mortgage information, into one large user-‐friendly database. More importantly, RPR contains the most useful and timely market information on fresh listings and closing information from the multiple listing services.

If such a comprehensive database had existed prior to the housing bubble years, it would have provided clear early indications of accumulating market imbalances. Such signs would have quickly halted the loose credit availability, which in turn would have limited unjustifiably strong upward pressures on home price. Likewise, the availability of this database will provide the necessary information about overcorrection in the marketplace to help limit the downward damage.

From the perspective of REALTORS®, RPR provides not only critically needed information to be at the top of the game, but also the necessary fact-‐based data analysis to help them communicate better with their clients. Surveys of home buyers have consistently ranked REALTOR® knowledge of the market, local area, and the purchase process as the skills clients value most, after the most important value of honesty and integrity.

The real estate business is not about one-‐off transactions and quick commissions. REALTORS® must serve clients’ best interests in order to get referrals, and business success in real estate requires referrals. This fact is strongly supported by NAR data, which show that 59 percent of homebuyers and 69 percent of home sellers report that they find their agent either through a referral or have worked with the agent in a prior transaction. In short, RPR provides critical market information and data analysis for REALTORS®. Clients value that knowledge. Satisfied clients in turn refer friends and colleagues to the REALTOR® they worked with. RPR facilitates the connection with clients who are seeking an expert in real estate.

“RPR facilitates the connection with clients who are seeking an expert in real estate.”

Lawrence Yun, Chief Economist Senior Vice President of Research National Association of REALTORS®, Washington, D.C.


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Knowledge for the REALTOR® Let’s put using the RPR report tools into everyday scenarios to understand how these tools can work for your clients and customers.

A Typical Listing Call? How does the typical listing call begin? For most real estate professionals, it probably starts with a phone call that goes something like this.

We’ll stop the conversation here for a moment. Although you would probably continue by asking some pre-‐listing appointment questions like how long the owners have lived there, why they are moving, how soon, and so forth.

Good morning, (your) real estate company. Hi. This is ____. You

sold my sister’s house.

Thanks for calling. How Can we help you?

We’re thinking about selling our home and my sister thought you might be able to help us.

What’s the address and location of your home? We’re in the Crestwood

area at 1407 Park Street.


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What would you like to know before you set out to do a listing presentation? Many real estate professionals can attest that although they gather a lot of pre-‐listing appointment information during the initial conversation, what prospects share during a phone call is seldom the full picture. How helpful would it be if you could obtain a comprehensive report on the property and its sales and financing history? Before your listing appointment, would you like to know if the property has been on the market several times? Would you like to know if the property had pre-‐foreclosure problems—currently or in the past? How much time would it save if you had a good idea, before the listing appointment, if you want to represent the sellers and their home? REALTORS® can use the Property Report to learn more about a property and the seller’s circumstances before setting foot in the house.

Sales and Financing Activity Chart The chart shows when a property was bought or sold over the past several years. It also shows whether the property has been refinanced or foreclosed. You can also view the estimated loan balance and the estimated value of the property over time. Based on the length of time the sellers have owned the property, you can make an educated guess about the amount of equity in the home.


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Knowledge for the Seller Assuming that you have determined that the sellers are motivated and you want to represent them in the sale of their home, researching and preparing a Seller’s Report is the next step.

Price—The Big Question

What is the hardest part of a listing presentation? Most real estate professionals would answer that reaching agreement with the sellers on price can be a difficult, sometimes touchy, conversation. During the transitioning market of the last few years, sellers need to be more knowledgeable and realistic than ever about the factors that determine price and attract buyers. Sellers sometimes need to be reminded that buyers have been looking at properties and making comparisons. The competition encompasses all of the homes on the market including the accumulations of distressed properties that can skew a market.

The location—“hyper location”—and condition of the house are major determinants, but it all comes down to the question: considering its location, condition, and features, does the demand exist for a house like yours?

Experienced real estate professionals know that right-‐pricing a property produces a quicker sale. It is sometimes difficult for sellers to understand, in retrospect, that a fast sale at the right price doesn’t mean the home could have been priced higher. Time is money and a house that lingers on the market costs the sellers in terms of continued upkeep, mortgage payments and taxes, as well as lost opportunity. Waiting for the market to turn around may mean future pressure to sell in even worse circumstances.


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What Sellers Most Want from Real Estate Agents

Source: Profile of Home Buyers and Sellers 2014, National Association of REALTORS®, www.realtor.org/ research

Comps Analysis

The RPR Comps Analysis tool is like a CMA, but has a lot more muscle than the traditional report because it can be refined and customized to fine-‐tune both the selection of comparison properties and the value of the specific home. It can also mix the MLS data with the publicly reported sales of comparable properties. It also adds the ability to include pre-‐foreclosure and foreclosure properties. The RPR Comps Analysis tool enables you to:

! Validate the facts for the property in order to perform a high-‐quality comps search.

! Search for comps based on the adjusted property facts.

23%

20%

14%

19%

13%

5%

3%

1%

#1 Market the home

#2 Sell the home

#3 Find a buyer

#4 Price home compebbvely

#5 Advise how to fix up the home

#6 Negobate and deal with buyers

#7 Help with paperwork

#8 Find another home to purchase


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! Adjust the comps by comparing them to the subject property.

! Review and adjust the results. If you’re not satisfied you can override it by entering your own number or round the number up or down. Or you may have a price in mind that you want to present the client. You can also narrow or broaden the range or omit a range; entering your own price and leave the range fields blank.

But My House Is Worth More

How much does a kitchen or bath remodel add to the value of a house? A home improvement estimator and slider bars (see page 47) included in RPR tools let the real estate agent adjust a home’s value up or down.

! Home improvement estimator Report tools include a home improvement estimator that “discounts” the cost improvements to present value

! Fill in information Missing information can be filled in and inaccurate data updated, like square footage or the number of bedrooms.

! Home and market condition


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Slider bars refine value based on local market conditions and home condition in comparison to comparable properties.

Using the RPR tools to refine value connects data to market realities for the seller. For example, a new roof doesn’t up the price—the buyer expects to get a roof and four walls—as much as an upscale kitchen remodel or a room addition. But the new roof may be a deciding factor when a buyer is weighing the merits of one home versus another.

The RPR tools are all about right-‐pricing a property. Simply put, they replace the “what ifs” with rational, data-‐based decision making on price.

Now, let’s take a look at the nuts and bolts of researching a property and fine-‐tuning the value.


47

Refining Value and Selecting Comparables

Start with a search by address. Adding basic facts—square footage and lot size—refines the value.


48

Refine value based on

home improvements.

Select from the list or add

other improvements. Fill

in the date completed

and total cost. Add a

custom description for

“other.”

The current value of

improvements is added

to the refined value of

the home.


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Use the slider bars to refine value for market and home conditions. This home scores better than comparable properties on interior and exterior condition as well as view.


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All done? Click on the Summary tab for a detailed recap. Click on

Get a Report and choose Seller’s, Property, or

Market Report.


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Seller’s Report


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The Seller’s Report Content

The Seller’s Report answers sellers’ frequently asked questions:

! What are the basic facts about this property? " Property summary with map views " Median estimated home value (this house, ZIP Code, county, state)

! How much is this house worth? " How much value do home improvements add " Pricing strategy cumulative analysis " Seller’s proceeds (low and high)

! How do comparable properties compare? " Median estimated home value versus median listing price " Median sales price versus sales volume " Listing price, home facts, aerial and street maps of comps " Comps last 90 days

! What are the market conditions? " Property summary with map views " Market facts, market summary for ZIP Code " Median listing price versus listing volume " Inventory of distressed properties (pre-‐foreclosure and bank-‐owned) " Median sales price by square foot " Median days on market (ZIP Code, county, state) " Sales history " Market activity summary " Comps last 90 days

! Are other homes selling and for how much? " Market activity by listing status by various time periods " Price range of homes sold " Price per square foot of homes sold " Age range of homes sold " Sales price, home facts, aerial and street maps of recently sold

properties " Estimated value, home facts, aerial and street maps of distressed

properties " Distressed last 90 days


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Knowledge for the Buyer Now, let’s take a look at the other side of the transaction—the buyer. NAR research shows that buyers’ top two concerns are the quality of neighborhood and convenience to work. The RPR Property Report answers these questions and more. How close are the schools? Are the supermarkets and medical services nearby? Is the neighborhood walkable? Are there public transportation options? As we will see, advanced search and mapping features help create and enrich the picture of living in the home and environs.

A Typical Buyer Counseling Session?

The RPR Property Report links market data to real-‐life experiences of living in the house and the neighborhood—all the factors that make a house a home.

The Property Report places the home in its context in terms of geography and lifestyle. It answers the question: what will it be like for me and my family to live in this community, go to school, commute to work, enjoy


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entertainment and recreation, shop and dine out, and take care of our health? Getting down to the hyperlocal details, the Property Report provides information on the neighborhood demographic profile—age, education, income, and family composition.

What Do Buyers Want Most From Real Estate Agents?

Rankings of what buyers want most from real estate agents are consistent for first-‐time and repeat buyers and previously owned homes as well as composition of the household—married or unmarried couples and singles. Source: Profile of Home Buyers and Sellers 2014, National Association of REALTORS®, www.realtor.org/research.

1%

2%

4%

6%

8%

11%

12%

53%

Other

Help find and arrange financing

Determine how much the buyer can afford

Help with paperwork

Learn prices of comparable homes

Help with price negobabons

Help negobate sale terms

Help finding the right home


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Mapping


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Search Options

RPR’s mapping offers several ways to define a search area:

! Use the toolbar above the map to create a customized search:

" Box search defines a search area in a rectangular shape

" Radius search defines a circular parameter around a central point

" Polygon search allows you to draw an area encompassing any number of points, as well as search multiple polygons at once.

" Drive Time search allows searching for properties within a specified drive time of a certain location

" Distance search searches for properties within a certain distance of another location.

! Geographic areas such as city, ZIP code, neighborhood, Census block groups, school district, 6th-‐8th grade, K-‐5th grade town, city, and can be selected individually or in groups for search.

! All custom search areas can be saved and recalled, which makes it easy to retrieve and tweak searches.


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Built-in Flood Mapping

A mapping tool toggles a layer of FEMA flood-‐map overlays. And, the maps are generated using the latest available data. Anyone who has spent time on the FEMA website trying to research and download flood maps can attest to the value of this RPR mapping function.

Heat Mapping

The heat map overlay provides a quick visual representation of price trends—up or down—in a search area.


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Property Report


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Property Report Content

The Property Report answers buyers’ frequently asked questions:

! What are the basic facts about the property? " Property Summary with aerial and street maps, property photos " Sales History " Mortgage records " Sales and financing activity

! Are there a lot of foreclosure homes on the market? " Distressed activity " Inventory of distressed properties in ZIP Code

! How do comparable properties compare? " History, median estimated home value " Price range of homes sold (past 6 months) ZIP Code and comps " Price per square foot of homes sold (past 6 months) ZIP Code and

comps " Age range of homes sold (past 6 months) ZIP Code and comps " Median sales price by square foot (past 6 months) ZIP Code and comps

! What are the current market conditions? " Market activity summary " Median estimated home value versus median listing price " Median sales price versus unemployment metro area " Unemployment rate metro area, state, nation " Median sales price versus sales volume " Median listing price versus listing volume

! What is it like to live in the neighborhood? " People facts and stats " Population of children by age " Population of adults by age " Households with children " Household income brackets distribution " Occupation categories " Presidential voting pattern by party of county " Economic facts and stats, ZIP Code, county, state " Quality of life facts, water quality, superfund and brownfield sites " Average commute time, how people get to work " Climate facts, average monthly temperature, heat and chill comfort

index


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FSBOs—Never Say “I’ll Get Back To You” Again Does this sound familiar? While you are driving a buyer around to view properties he spots a FSBO and says something like “What about that house? Could I see that one?” You jot down the phone number on the seller’s sign and say to the buyer, “I’ll see what I can find out and get back to you.” Before you can gather information and call back, the buyer has already contacted the seller.

When it comes to FSBOs—homes privately for sale—providing timely information may make the difference between closing a successful transaction or being cut out because the buyer contacted the seller directly. The RPR tools mean never saying, “I’ll get back to you” again.

Now imagine this scenario—while you are in your car with the buyer, you can use RPR Mobile™ on your smartphone or iPad (coming Q2 2015) to search the home’s address and download a Property Report with pertinent facts. Although these homes will not show up in the MLS listings, a wealth of public information is available like sales6 and financing history and other facts. On-‐the-‐spot access to Property Report data means you can present facts about the property immediately and determine if the home privately for sale is one that meets the buyer’s needs and wants. If the answer is yes, you can contact the seller immediately to learn the asking price and arrange a viewing. Where sales data is publicly reported, RPR aggregates data on recent and current sales to calculate an estimated value for the property; this AVM estimate can indicate if the home is over– or underpriced in comparison to similar properties in the neighborhood.

Sellers who offer homes privately for sale often do so to avoid paying an agent’s commission. That may necessitate a separate conversation with the buyer or seller to clarify how you will be compensated. But the level of service and information access that RPR tools deliver reinforces both the value you add to the transaction and your position as the first point of contact.

6 Except in nondisclosure states. See page 22 for list of states.


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Knowledge for Your Network Third in RPR’s trilogy of reports is the Market Report. Instead of focusing on a particular property, the Market Report provides a snapshot of all the changes in a local real estate market. It includes a market activity summary and a listing of active, pending, sold, expired, and distressed properties. Recent price changes and upcoming open houses are also included. Graphics and charts visualize market trends and communicate them with impact. The report time frame can be for the last 3 days, last week, or last month.

Market Report Contents

! New listings

! Price changes

! Pending sales

! Expired

! Recently sold

! Distressed

! Open houses

The Market Report not only provides a bird’s eye view of trends, it can be used as an after-‐sale information piece to keep current and future clients and customers up-‐to-‐date. A monthly Property Report posted on a real estate professional’s blog or e-‐mailed to past clients provides an up-‐to-‐the-‐minute answer to the question that began this course—what’s my home worth today?

Business owners and operators in your professional network are interested in market conditions too because their profitability depends on a healthy real estate market. A monthly or quarterly Market Report keeps your business contacts up to date and keeps you top of mind for referrals.

In the next chapter we’ll explore more ideas for using the power of RPR reports to inform consumers and stay in touch with past clients and customers.


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Market Report


63

Neighborhood Report


64


How will you use the RPR Reports to help buyers and sellers make more informed decisions? To keep your network up-‐to-‐date?

Next Chapter

So far, we have looked at how automated valuation models can help or misguide consumers. As we learned, most consumer-‐facing AVMs use “rearview-‐mirror” data to establish value, but RPR’s Realtor Valuation Model uses MLS data that yields real-‐world price information. Plus, the RPR Reports connect sellers and buyers with the knowledge they need to make good decisions. In the next chapter, we’ll look at how REALTORS® can perform a valuable service by using RPR’s rich data stream to keep consumers and the business community up-‐to-‐date on market developments.

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4. RPR®: A Win for Consumers and REALTORS®


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Who knows a farm area better than a real estate professional who works it? They drive those streets and meet prospects in their niche market every day. Automated systems can never replace the value of intimate local knowledge that real estate professionals bring to the transaction. RPR helps REALTORS® combine the best of data aggregation and communications technology with hyperlocal knowledge.

The RPR reports offer a robust prospecting tool for staying top of mind with potential customers and clients. But the reports’ uses and value extend beyond the transaction. As the economic events of the past few years have demonstrated, everyone has a stake in the real estate market: buyers, sellers, landlords, tenants, business owners, employees, lenders, service companies, and many others in the community. RPR reports help REALTORS® keep their networks informed through social media and blogging.

RPR Coverage Map—December 2014 As of December 2014, RPR partners with 613 MLSs. Go to the RPR blog at http://blog.narrpr.com to view a current map of MLS partners.

Because RPR is a dues funded member service, there is no out-‐of-‐pocket fee for using any of its reports or tools. On November 1, 2012 RPR’s national launch opened access to RPR’s many valuable features and tools—including a database of more than 166 million parcels of properties—to all REALTORS®. There are differences, however, in feature and tool availability between market areas where MLSs partner with RPR and license data and those that don’t. Where the MLS has not partnered, the Realtors Valuation Model calculation is inconsistent. That means that real-‐world pricing information isn’t available. Where the MLS opts out of partnering, the RPR system


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calculates value estimates using an AVM based on public record data, not the dynamic and continually refreshed pricing information drawn from MLS data.

The Power of RPR Tools ! Time saver: How long would it take you to gather information from all

of these sources and combine it into a report: sale and financing history of a property, foreclosure history, parcel maps, school district boundaries and school ratings, FEMA flood map, property tax records, neighborhood census data on age and number of children, neighborhood income and education levels, political leanings, neighborhood service and retail businesses and commuting time? When you request a Seller’s, Property, or Market Report, RPR automatically goes to work, tapping into hundreds of databases for relevant facts and figures to create a financial, statistical, and narrative profile of a property and its environs. And the entire process only takes a couple of minutes to complete. You may be able to log on to both RPR and your MLS with a single sign-‐in—no need to remember different user names and passwords.

! “Back-‐office” support: After you have finished gathering all data, now how long would it take to synthesize it, gather photos plus aerial and street maps of all of the comps and the neighborhood, draw charts and graphs to illustrate all of the data, list all the sources, and assemble it into a report? Got a couple of minutes? That’s about how long it takes from the time you click on Get Report until the report is ready to download or e-‐mail. The RPR report tools are like having a back-‐office computer geek as a personal assistant.

! Enrichment: Not only is the data retrieved and calculated at warp speed, all of the data is presented in professionally designed charts, graphs, street and aerial maps, and full color photos.

! Organization: The organization of report information follows a natural flow that compliments your listing presentation.

! Anywhere access: You can access RPR’s vast array of property data anytime, anywhere using RPR Mobile™. Search for any property on and off market, view market conditions and property details including status, listing and sales activity, tax, assessment, deed, mortgage, and distressed information. RPR Mobile™ also allows you to create and send reports and call the listing agent. Download ‘RPR Mobile’ from Google Play for Android Phones or the App Store for iPhones.

! Value proposition: RPR tools help the agent create and manage sellers’ expectations by showing their work: the thought processes and data calculations combined with experience


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and local market knowledge. If an agent’s recommended pricing doesn’t match up with the online consumer AVMs, he can show the work that went into developing the pricing strategy.

! REALTORS® only: RPR is an exclusive, members-‐only benefit of the National Association of REALTORS®. Consumers and lenders cannot access and use the tools.

! REALTOR® success first: RPR’s first priority is support for members’ success and profitability. Unlike consumer AVM sites, RPR is under no pressure to capture leads, resell content, or sell advertising.

Let’s take a look at how other REALTORS® have harnessed the power of RPR to serve their clients and customers plus build their businesses.


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Kyle Else, REALTOR® Keller Williams Realty, Inc., Palo Alto, CA https://www.youtube.com/watch?v=82LEF8NewvU

“RPR Reports have been valuable to grow and expand my business and build a trusting relationship with my clients.” – KYLE ELSE

Whether working with residential or commercial clients, Kyle Else relies on RPR’s reports to impress clients and grow his business.

Kyle Else is a REALTOR® in Palo Alto, in the southern part of the Silicon Valley. He works with both residential and commercial properties in one of the hottest real estate markets in the U.S. He prides himself on providing all the information his clients need to make an informed decision. With the market price typically dependent on the sales activity in the local area, Kyle works to provide his clients with the data and analytics they are looking for.

The Challenge

With the Silicon Valley being home to the some world’s largest tech companies, such as Google,

Apple, and Facebook, as well as thousands of smaller start-‐ups, the area is saturated with very

educated and analytical clients – the kinds of clients that feel comfortable researching and finding

their own information when buying or selling a home. It can often be difficult to help sellers

understand comparable properties. With so much information on the Internet, it’s essential to find accurate data that goes beyond the basics, especially for those clients that are highly analytical.


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The Result

RPR allows Kyle to create a market visualization for his clients through charts, map layers, school reports, just the type of data his clients are looking for. He summarizes the data and can easily link to a report he can put in their hands, allowing this clients to really understand the dynamics of the market, and property itself. Giving clients who want the full kitchen sink of information regarding their home and the surrounding area of their home has made RPR reports a truly valuable part of Kyle’s business.

Kyle’s success with RPR reports goes beyond residential transactions. The commercial application of RPR has helped Kyle develop new relationships with both commercial and residential clients. When a city is saturated with innovators and entrepreneurs, your clientele can be looking to buy both a home and set up a business nearby. The demographics information in RPR Commercial has given Kyle the upper hand in serving his clients on both aspects. “Many local businesses are also local citizens of the area. And having the ability to provide a commercial report with demographics on nearby customers is truly valuable,” says Kyle.


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Ressie Wallace Wilson, REALTOR® RE/MAX Allegiance, Washington, DC https://www.youtube.com/watch?v=HdnlX2KVL8k "RPR Reports give Buyers ‘the big picture’ on market trending in a neighborhood they are interested in.” – RESSIE WILSON

RPR’s Market Activity Reports allow Ressie Wilson to help buyers make good, sound, lasting decisions.

Ressie Wallace Wilson has been in the real estate industry for over 13 years. In that time, she has seen all the ups and downs of the market. Specializing in Washington DC and surrounding areas, Ressie prides herself on providing all her clients with the information they need to make educated decisions. Ressie believes, “Our job as REALTORS® is to help clients make a good, sound decision that will still be a good, sound decision 10, 15, 30 years from now.”


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The Challenge

Recently Ressie was working with buyers whose parents and grandparents were also actively involved in the decision-‐making and purchase. Like most parents and grandparents, these family members wanted to ensure their children/grandchildren were buying in a neighborhood that would prove to be a good investment for years to come.

Their biggest concern was that their children/grandchildren would buy into an area saturated with foreclosures; they wanted to ensure the neighborhood not only fit overall criteria, but that financially, it would be a solid investment.

“There’s a lot of information available to buyers. We need to make sure they’re getting accurate information about truly what’s happening in the neighborhood they’re interested in,” Ressie explains.

The Result

Ressie knew she had her work cut out for her. She not only needed to find her buyers the home of their dreams, but she needed to make the entire family comfortable with their decision. And she knew RPR’s Market Activity Report would be able to do just that.

Thanks to the numerous layers available in a Market Activity Summary, Ressie was able to pinpoint the data her clients needed and give them the ‘big picture’ on market trends. She gave them information on current sales, past sales and foreclosures all in one report.

“We used RPR’s Market Activity Report to show the clients’ parents and grandparents that they were buying in a neighborhood that was trending in the right direction.” With everyone now feeling comfortable, they were able to move forward with the purchase.

“RPR has been invaluable to me. I use it as another layer to help my clients.”


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James and Penny Brockway Brockway Realty https://www.youtube.com/watch?v=JGf_bIfobdI

"Our client was thrilled we got her such a high offer on her home. But, the reason we were able to do that, was because of RPR.” – PENNY BROCKWAY


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Using RPR®, James and Penny Brockway were able to get over $30,000 more for their client

After closing his first residential deal in 2002, James knew he wanted a career as a REALTOR®. Since opening Brockway Realty in 2004, James has not only created a successful business, his passion for real estate is so infectious, that his wife, Penny, became a REALTOR® and is now their top selling agent.

Working together, the Brockways specialize in the Houston, Texas area where Penny prides herself on finding buyers their dream home, and staging listings for their sellers, while James specializes in the contractual and financial side of the transaction. “We are the perfect husband and wife team,” says James.

The Challenge

Penny recently had a past client call her to list her home. The client had purchased the home for $183,000 and was looking to break even with a quick sale of about $189,000. Because the client has worked with Penny and James previously, she was sure they could get her the price she was looking for.

Upon researching the property and comparable properties in RPR, Penny realized she could list the property for as much as $227,000, far more than the $189,000 the client was looking for. However, her client felt this price was, “way, way too high,” and James thought $200,000 would be a better place to start. Penny knew both of these prices were low and was determined to prove it.

The Result

Penny immediately returned to RPR to create a report showing her client why she felt strongly that they could list the property for $227,000 and still have a quick sale. Starting with one of her favorite features of RPR, the RVM Confidence score, Penny began to put together concrete data. “With 5 stars of confidence, I feel like I can go towards the higher range,” Penny states.

After showing both James and their client the data she found on RPR, they decided to list the property at $220,000, over $30,000 more than their client had asked for.

Within eight days, they received a full price offer on the property. In fact, they continued to receive offers that were over list price! “RPR has changed our business because it has given us more credibility. It’s go so many features you can use,” says James. For Penny, it’s simple: RPR is “my secret weapon.”


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RPR Reports in Action—3 Scenarios Let’s look at the following scenarios for examples of RPR in action to serve your clients and customers.

#1: Property Report—Sunday Afternoon Drive

Your buyer-‐clients are driving around neighborhoods on a Sunday afternoon and scoping out homes that looked interesting on the Internet. One of the homes may be just what they have been looking for, but before falling in love with it they want to know what they’re getting into. You’re at an open house when you receive a call on your smart phone and the conversation goes something like this. “Hi, this is Bill Grady. We just drove by a home for sale that looks really interesting. It’s at 6509 N. Warren in the Maple Grove neighborhood. The sign out front is from another agent, but can you get us some more info about it? If the price is right, this could be the one.”

Of course, your answer is yes, but how quickly can your provide the information? Picture this solution. You access RPR Mobile on your smart

phone, input the address, and click on Property Report. When the report is ready—a couple of minutes—you send it to your buyer-‐client who receives it immediately via email while cruising the neighborhood. The report is branded with your logo, photo, and contact information so there’s no confusion about which agent to call.

#2: Seller’s Report—Sprucing Up Adds Value

You arrive at a seller’s home for the second listing appointment. You’ve done the research on comps, market values, and factored in the condition of the home, but you’re fairly sure the sellers will think the list price should be higher than what you’ll recommend. Some repairs and improvements could improve curb appeal. There’s a brush pile in the side yard and a bare patch in the front yard that never seems to go away. The window frames and front porch could use a coat of paint. The garage door opener appears to be off the track again—a chronic problem since last winter when their teenage grandson’s car slid on the icy driveway and walloped the door. The sprucing up could help, but with distressed inventory affecting home prices, what can you say so that the sellers will

Property Report Sunday Afternoon Drive

#1


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Seller’s Report Sprucing Up Adds Value

agree to a good price and list with you? You present the sellers with a 40-‐page report that details comparable properties, including distressed ones that aren’t currently on the MLS but will have an impact on neighborhood values and compete with this property for buyers. The report shows the impact of market conditions, reflects the condition on the home, and projects sale proceeds at a recommended price.

During the presentation you say, “The distressed property inventory in the area is weighing down the market at this time and competing with your home. The reality is that market conditions are causing some sellers to price homes lower. Other similar properties in this neighborhood might sell for more, but there are some factors that make your home less attractive. Let me show you the value impact of making some of the updates or repairs we talked about.”

“This Seller’s Report shows my work in developing the price I’m recommending. When you see the quality and level of detail of the information, I believe that you’ll come to the same conclusion and we will agree on a list price. I’ll also show you how your property will be marketed and go over the services I offer. I’m confident that you will be very comfortable with the pricing strategy and marketing plan, and we’ll be ready to get to work on finding a buyer for your home.”

#3: Sellers Report—Third Party Seller

You’re working with a relocation company to sell a home purchased from an executive transferred out of state. Your relocation company contact wants to know how much the home can sell for as is as well as the potential proceeds if some improvements are done. Several of your buyer-‐clients have viewed the home, so you’re quite familiar with its layout and condition. You go to RPR and search the home’s address to prepare a Seller’s Report. The RVM pegs the value at $175,000, a good price in the current market. Sales and financing history show that the seller lived in the home for only 3 years, not enough time to build up a significant amount of equity or value appreciation. It’s clear that the sellers didn’t have a lot of leeway to reduce the price without taking a loss. It was on the market at $190,000, with no offers, when the

#2

Seller’s Report How fast can this sell?

#3


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executive had to move and the relocation company bought the property. Your contact wants to know what improvements could bump up the list price. Using the RPR value refinement tools you are able to demonstrate the potential value increase as a result of the following repairs and improvements.

" Replace worn carpet in the hallway and living room " Sand and refinish the hardwood floors in the family room where

dogs have scratched the wood " Upgrade the landscaping in the front yard to enhance curb appeal

and remove old shrubbery in the back yard that blocks a lake view " Repaint the kids’ rooms—one is painted hot pink and stenciled

with cartoon characters and the other is dark brown " Complete stalled construction to enclose part of the deck for a

year-‐round sunroom

When all of these steps are accomplished, you can demonstrate to your relocation company contact that the home’s value would be enhanced enough to sell at the $190,000 list price.

Notes:


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RPR Reports Help Distressed Properties

Helping Sellers

The experience of losing a home through foreclosure or a short sale is a very emotionally charged situation for the homeowner. Real estate professionals who have experienced these transactions know the situation calls for empathy and tact. RPR tools offer valuable information resources to help. Here’s how.

The objective information contained in a Seller’s Report can help homeowners in tough situations understand market realities. Facts offer a powerful antidote to the panic that can paralyze a fearful homeowner into inaction. If there are many distressed properties in the area, it may help sellers work through some of the emotions to see that other homeowners are facing similar circumstances.

On the practical side, RPR data provides a source for the property and market for compiling a short-‐sale package. The Seller’s Report delivers reliable information on inventory, comparable properties, average days on market, price trends, and absorption rates. A lender looks to this data to evaluate the merits of a short sale proposal. Acceptance of the proposal hinges on pricing a property right to balance the lender’s expectations with the need for a quick sale. But winning the lender’s approval of a short sale is only half the battle. A short sale requires prudent handling of offers and counteroffers. If the property fails to sell in the agreed length of time, the lender may move forward with a foreclosure. On the other hand, the lender may reject a lowball offer. Instead of jumping at any offer, the seller must demonstrate a thoughtful approach to offers and be willing to make a counteroffer when appropriate.

Helping Buyers

In short-‐sale situation, sellers need quick transactions, but they don’t want to have opportunistic buyers, like flippers, snapping up their homes. And they certainly don’t want to feel that buyers are swooping in to take advantage of others’ misfortunes. RPR data on properties and markets can help buyers understand the dynamics of the market and formulate offers on short sale properties that lenders will accept. The data can help buyers understand that foreclosure-‐saturated markets are likely not


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opportunities for quick profits. Property reports may help auction buyers, especially investors, target areas and properties with good potential.

Working with Lenders and Relocation Companies

With a huge inventory of REO properties as a result of foreclosure, preparing BPOs for lenders has become an active and lucrative part of some real estate professionals’ businesses. Third-‐party sellers like banks and relocation companies really do not want the responsibility of owning and maintaining an inventory of properties. The best scenario for third-‐party sellers is a quick sale at an “as is” price and condition.

REALTORS® can use the RPR tools to help lenders and relocation companies understand the market realities when it comes to pricing. The RPR value refinement tools—home improvement estimator and slider bars—can provide value estimates on as-‐is condition compared to making some improvements or repairs. Later in this chapter (page 83), we’ll learn how REALTORS® can combine RPR tools with NAR’s Broker Price Opinion Resource (BPOR) Certification to earn extra income.

Using Information Responsibly Earlier in the course, we learned how a REALTOR® can use the RPR reports as prospecting tools. On a cautionary note, remember that the level of detail RPR reports provide about the history of property’s ownership probably would be surprising to most homeowners. For example, properties headed toward foreclosure may show up in RPR data before listing on the MLS. Although the info is public record, the ease of availability and level of detail could, if mishandled, create a perception of compromising a homeowner’s privacy. A call that starts out, “I see you’re headed for a foreclosure” or “It looks like you’re underwater with your mortgage” would probably end with the door slammed in your face.

Source of the Source

As noted at the beginning of the course, information becomes knowledge when it is imbued with meaning for the listener or reader. The RPR reports accomplish both goals—compilation of a huge amount of data presented in a meaningful way. This reinforces the role of the REALTOR® as a knowledgeable and reliable “source of the source.” If a buyer or


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seller wants to delve deeper into the data, information sources are noted throughout the reports.

Fair Housing Considerations

Real estate professionals must always be watchful that presentation of demographic information about a neighborhood does not stray off course to inappropriate topics that violate Fair Housing Rights. It’s important to note that all of the RPR data is objective information drawn from public and government sources like the Census Bureau and Bureau of Labor Statistics. Reports contain objective information on factors like: employment, income levels, presidential voting preferences, number of children, school ratings, and crime statistics. The RPR report information does not, however, contain any information on the federally protected classes: race, religion, color, sex, handicap, familial status, national origin.

Sharing Information Responsibly

The ability to gather and share data by electronic means carries both a legal and ethical obligation to share information responsibly. Therefore, it is very important that you know who you are sharing information with and why. When providing RPR reports to home sellers and buyers, REALTORS® should emphasize the importance of treating the information respectfully and making sure it doesn’t fall into hands of someone with bad intentions. You wouldn’t want to be accused of careless handling of information that caused harm to a buyer or homeowner.


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RPR Mobile REALTORS® can create, customize, view, save, and send RPR’s full library of report options, and add photo, audio, and text notes to properties.

1. To download RPR mobile™, visit either the Apple App store or Google Play store and search "RPR mobile”.

2. Login with your existing RPR account. If you are new to RPR, from the homepage select "Create New Account”. You’ll need your NRDS ID.

3. The RPR mobile™ homepage allows you to track current market activity and even click right into what’s happening around you. Or swipe to the right and get market trends, and swipe again to search by any address, zip code or more.


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4. Press on a property record to view property photos, physical characteristics, showing instructions, owner info, tax, mortgage, historical and distressed data, flood zones, school info and lots more.

5. When you're ready, press the "Add Report" button to create

one of the following reports: property report, mini-‐property report, seller’s report, neighborhood report or market activity report.


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BPOs and RPR Grow Your Income RPR’s rich data stream, report generation capabilities, and value refinement tools make it a natural for preparing BPOs. RPR leverages its partnerships with NAR’s Broker Price Opinion Resource (BPOR) Certification Program and leading BPO management companies to offer REALTORS® an opportunity to make money by performing a valuable market service. RPR has arranged for members who complete the BPOR Certification to receive preferred status for BPO orders in their markets. Through its relationships in the valuations industry, upon completion of the course of study (classroom or online) and required application process, BPOR Certification holders are enrolled in a panel of preferred BPO providers with priority treatment for receive BPO orders. The course is available in classroom format and online through REALTOR® University.

How to Get Started ! Complete the BPOR course—

classroom or online and pass the exam

! Complete the one-‐time application process and fee at www.BPOR.org

! RPR will enroll you as a preferred BPO provider so that you can receive orders. RPR will also update your new education status in NRDS.

Benefits ! Use the BPOR Certification in your

personal marketing

! Receive best-‐practices updates from lenders

! Listing in BPOR directory listing on Realtor.org and Realtor.com

Driven by default markets, BPOs play a more important role than ever. According to industry estimates, more than 10 million BPOs are performed annually throughout the country. Your MLS does not need to be signed up with RPR in order for you to receive BPO orders through the program.


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The Broker Tool Sets The Broker Tool Sets (BTS) help brokers and managers leverage the power of RPR across their entire market area. RPR helps brokers and managers integrate the tools in company operations by providing training, sales meeting scripts, and communications templates.

The four powerful tools include:

! Company Branding: Adds the company’s brand distinguishers, logo and tag line to agent-‐generated reports

! Affiliated Services Support: Displays information on your company’s ancillary services like mortgage, title, home warranty, and insurance with branch-‐office specific contacts

! Data Tool: Compiles market share reports, trends, and forecasting—across multiple MLSs—into one format

! AVM Widget: The RPR Broker AVM Widget displays a property's estimated value and associated data that Brokers can use on their public websites

RPR Commercial The RPR Commercial search includes commercial, industrial, lease, vacant land, business opportunities, market potential and business analyses. RPR Commercial also expands on that set of core functions to offer features of particular interest to commercial agents and brokers including:

! Business opportunities analysis

! Detailed location analysis and reporting

! Property information search and reporting

! Market analysis customer concentrations

! Market leakage reports

! Demographic, lifestyle and consumer segmentation


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! Trade area and analysis reporting

! Drive time ring analysis

! Thematic mapping with custom search tools


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Keep Your Eye on RPR RPR has launched additional tool sets for residential agents and brokers, commercial, MLS, associations, and valuation professionals.

Resources

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Resources Need Help? RPR Help Desk 24/7/365 ............................................................................. 88

The RPR All-‐Star Team ................................................................................................... 89

Technical Requirements for PC and Mac ........................................................................ 89

Websites ........................................................................................................................ 90

Authorized RPR Website User Access Policy ................................................................... 92


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Need Help? RPR Help Desk 24/7/365 A phone call to (877) 977-‐7576 puts you in touch with the RPR help desk—24 hours a day, 7 days a week, 365 days a year—based in Nebraska.

Click on the Help link on the top of any page on the RPR site or blog for the Help Desk. You’ll find a knowledge bank of more than 150 articles and videos about how to use RPR plus access to free training. Don’t see the answer to your question? You can leave a comment or ask a question and it will be shared with RPR representatives and other users. In addition, RPR maintains a separate area of the Help Desk specifically for MLS staff support.

The RPR Help Desk is also the place to go to sign up for weekly free Webinar training.

Call 1-‐877-‐977-‐7576

Resources

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The RPR All-Star Team

Dale Ross, CEO § Co-‐founder and former President and CEO of the Metropolitan Regional

Information Systems § Past President of the Montgomery Association of REALTORS® and Maryland

Association of REALTORS® § Charter member of the Partnership for Housing Foundation Board of

Directors and former Foundation President § Recipient of the Maryland Association of REALTORS® Lifetime Achievement

Award in recognition of his outstanding contributions to the real estate community

Marty Frame, President § Former general manager of

Cyberhomes.com for Fidelity National Financial and Lender Processing Services

§ Chief Technology Officer of REALTOR.com for Move, Inc.

§ Named one of the 100 Most Influential Real Estate People in 2005-‐2010 by Inman News

Jeff Young, Senior Vice President of Operations and Industry Relations § REALTOR® since 1995 § Past President of West Michigan

Lakeshore Association of REALTORS® and the Michigan Association of REALTORS®

§ Numerous NAR committee appointments

§ Charter member of NAR’s Second Century Ventures Board of Directors

§ Former Managing Partner of Woodland Realty, an independent nine office Michigan realty company

§ Vice President of Coldwell Banker Schmidt Realty, Michigan

Vice President, Marketing and Social Media § Founder of MyTechOpinion.com

real estate technology blog § Social Media Director for

Cyberhomes.com § Named one of the 100 Most

Influential Leaders in Real Estate by Inman News.

Karen France, Senior Vice President of Training and Programs and Industry Relations § Vice President of Training and Programs, RPR § Governmental Affairs Director, Kansas

Association of REALTORS®, 17 years § President, CEO, Real Estate Business

Resources LLC, a subsidiary of the Kansas Association of REALTORS®


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Technical Requirements for PC and Mac ! Operating system

" Windows XP SP2 or later

" Mac OS X 10.6 or later

Older operating systems are not recommended in part because they do not support current web browsers.

! Internet browser

" Internet Explorer 8.0 or later

" Safari 5.0 or later

" Firefox 20.0 or later

" Chrome 30.0 or later ! Internet connection: broadband connection recommended (256 kbps or greater), but RPR

will work over dial-‐up.

! Additional application: Adobe Acrobat Reader (or another PDF reader) to view reports.

! Cookies: required

Technical Requirements for RPR Mobile™ ! Apple users:

• iPhone 4 or newer

• iOS 7.0 or later

! Android users:

Android 4.0 OS (4.2 and higher recommended for best performance)

Websites ! Realtors Property Resource

www.narrpr.com (user name and password required)

! Realtors Property Resource Blog http://blog.narrpr.com

Resources

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! My RPR www.myrpr.com

! National Association of REALTORS® www.realtor.org

! RPR Mobile Promo Site m.narrpr.com


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Authorized RPR Website User Access Policy The following individuals shall be “Authorized RPR Website Users” with free access to the

RPR Website pursuant to the Terms of Use:

1. REALTOR® and REALTOR-‐ASSOCIATE® members of the NATIONAL ASSOCIATION OF REALTORS®.

2. REALTOR®’s Assistants. A REALTOR® or REALTOR-‐ASSOCIATE® member of NAR who is an Authorized RPR Website User may designate up to three (3) assistants who shall also be Authorized RPR Website Users. REALTORS® and REALTOR-‐ASSOCIATES® accept responsibility for the actions of their delegates in the system, and will be required to re-‐designate their delegates each year. 3. MLS Staff. Each Cooperating MLS may provide a list of staff users for whom it wishes to authorize access. MLSs accept responsibility for the actions of their delegates in the system. Such users must be re-‐designated by the MLS each year.

4. REALTOR® Association Staff. Each Cooperating MLS may designate the REALTOR® Associations employees for which it wishes to provide access. MLSs accept responsibility for the actions of their delegates in the system. Such users must be re-‐designated by the MLS each year. 5. Broker Staff. Each Cooperating MLS may determine whether it wishes to permit its REALTOR® participants to designate certain employees to be Authorized RPR Website Users. Brokers accept responsibility for the actions of their delegates in the system. Such users must be re-‐designated by each Broker every year. 6. Franchisor Corporate Staff. Each Cooperating MLS may determine whether it wishes to permit national franchisors that have operations in their market to designate certain corporate employees to be Authorized RPR Website Users. The purpose of such access is to allow franchisor trainers to assist in training and support of Authorized RPR Website Users who are affiliated with a franchised firm. Each MLS may set access policies for authorized franchisor staff that determine whether the franchisor staff may view the Cooperating MLS’s Active Listings and Pending Sales, and Off-‐market Listings. Franchisors are responsible for the actions of their delegates in the system. Such users must be re-‐designated each year by the MLS from nominations provided by Brokers who are Authorized RPR Website users.

6. ru 2015 rpr student manual

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