Messaging and Talking Points

www.realtor.org/surroundsound

Campaign Messaging & Talking Points This section includes Surround Sound messaging and talking points for you to use in your communications with the media and in your community. Included in this section are:

Campaign Messaging and Talking Points

o The basics

o Now is a good time to buy a home

o Now is a good time to sell a home

o Every market is different

o Homeownership has both economic and social benefits

o REALTORS® can help consumers gauge local market conditions

o REALTORS® care as much about keeping families in their home as they do

about helping them find the right home.

The NAR Message House

Blank Message House

Sample Questions and Answers

Homeownership Benefits

What is a REALTOR®?

The Truth Behind Housing Data

Tips to Share: Buying and Selling a Home

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Campaign Messaging & Talking Points The basics

Today’s market offers great opportunities for buyers and sellers.

The supply and choice of homes for sale is plentiful in most markets.

Mortgage interest rates are low.

Home prices are affordable.

Homeownership offers immediate benefits and long-term value.

REALTORS® add value to the real estate transaction.

REALTORS® are the most trusted resource for real estate information.

Now is a good time to buy a home. Home prices have moderated, interest rates are at 40-year lows and the supply of homes for sale is

plentiful. However, in some markets, the supply of unsold homes is beginning to diminish.

Foreclosures are selling quickly in most places, especially in the lower price ranges that are attractive to first-time buyers.

There are a number of attractive and safe mortgage products available now, providing additional reasons for buyers to get off the fence and into the market.

The FHA single-family loan program is alive and well. As specialty mortgages have faded away, FHA is stepping in. In fact, the FHA market share is up to more than 30 percent, from just 6 percent in 2007.

Now is a good time to sell a home. Low interest rates, coupled with price declines give trade-up buyers a unique opportunity to take

advantage of market conditions. What an owner may lose on the sell side can be more than recovered on the buy side.

In some markets, prices have begun to rise, however, sellers should not expect explosive growth in home values.

A return to the traditional 3-5 percent annual home price appreciation rate is likely in 2010. However, this is a national average and local markets vary widely. It’s best to consult a REALTOR® for the most accurate local market conditions and to help you set the right selling price.

To sell quickly, make sure your home carries a compelling price, not just a comparable one.

Every market is different. The national housing forecast is no more useful than a national weather forecast.

It’s important to consult with a REALTOR® to get accurate local market information.

Location has never mattered more. While prices in some neighborhoods remained relatively stable this year, others fell depending on their exposure to subprime loans. Softer markets are providing especially good opportunities for buyers now.

In the second quarter of 2010, 100 out of 155 metro areas surveyed by NAR saw median prices increase from a year earlier. This is an improvement from 2010’s first quarter when 91 areas had higher prices, and a year earlier when only 26 metro areas experienced annual price gains.

Markets with the biggest price gains were in California and the upper Midwest – areas that had very high levels of distressed homes that were sold at a discount a year ago. We’re now seeing a more normal mix of sales, so the increase in median price seems large in those areas.

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Homeownership has both economic and social benefits. Most Americans still believe buying a home is a good investment. Nine out of 10 consumers

consider homeownership to be a sound financial decision.

Given the leverage in purchasing a home, the average return on a 5 percent down payment over 10 years is usually three to five times greater than stock market returns.

The typical homeowner’s net worth ($205,200) was 49 times that of the typical renter ($4,200) in 2008, according to NAR calculations using statistics from the Federal Reserve Board. (The Fed will come out with new figures on net worth in late 2010).

Homeownership is an investment in your future.

Home is where we make memories, build our futures and feel secure.

Owning a home offers immediate shelter benefits and long-term value.

Homeownership strengthens communities. Homeowners are more likely to be involved and engaged in local issues, and they move less frequently than renters. This helps to prevent crime, improve childhood education and support neighborhood upkeep.

Owning a home is one of the best ways to build long-term wealth, providing both equity accumulation and tax benefits over time.

REALTORS® can help consumers gauge local neighborhood conditions.

It has never been more important than now to work with a REALTOR®, the local market professional, to properly gauge local neighborhood conditions.

A growing number of consumers understand the importance of working with a REALTOR®. The level of “For Sale By Owner” properties (FSBOs) was a record low 11 percent of all home sales in 2009, down from 13 percent in 2008. The share of homes sold without professional representation has trended down since reaching a cyclical peak of 18 percent in 1997.

Distressed sales – foreclosures and short sales – account for more than a third of all transactions nationwide. This varies widely from market to market – sometimes even from neighborhood to neighborhood. Distressed homes typically are selling at a 15 percent discount, but this varies widely by market, as well.

REALTORS® have access to the most up-to-date and comprehensive property listing and sales information, making them a buyer’s best resource in finding the home that is right for each customer.

Many markets have two levels of pricing – distressed sales and traditional sales. Foreclosures and short-sales tend to carry prices as much as of 20 percent below traditional homes in the same area. REALTORS® can help both buyers and sellers navigate today’s tricky market conditions.

REALTORS® care as much about keeping families in their home as they do about

helping them find the right home. When people lose their homes to foreclosure, our communities, the housing market and our

economy all suffer.

NAR knows it’s important for REALTORS® to be prepared to support their communities by helping consumers avoid foreclosure. The association has launched several initiatives toward this end, including the Foreclosure Prevention and Response Program and the REALTOR® Neighborhood Stabilization Project. Additionally, many state and local REALTOR® associations have programs aimed at helping people avoid foreclosure.

Owning a home isn’t for everyone. REALTORS® favor responsible homeownership and work with prospective buyers to help find a home they can afford and sustain over time.

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Sample Q & A

Below are some potential questions you may be asked by the media, along with examples of

answers you might use. These sample questions and answers range in topics from market

conditions, to mortgage finance challenges, to the role of the REALTOR®. Each answer should

be combined with localized facts and figures if available.

Market Conditions Q: With the real estate market in a state of free-fall, how can you still believe it is a good time to buy a home? A: Yes, today’s housing market has its challenges, but the fact is that there are some powerful opportunities for home buyers. Prices have moderated, interest rates are at 40-year lows, and in many markets, there are more homes for sale than in the past 15 years. Today’s home buyers have a terrific opportunity to choose the home they want at affordable lending terms. In many areas of the country, homes are being purchased below replacement cost values. NAR’s most recent Profile of Home Buyers and Sellers survey showed that first-time home buyers reached the highest market share on record in 2009 – 47 percent! Clearly, the market conditions are compelling. Owning a home is still the American Dream, and today’s market puts it well in reach for a great many people. Q: Isn’t there a good chance prices will continue to drop further? A: While we don’t have a crystal ball, we can tell you that prices in most areas of the country have begun to moderate and in some places they are even rising. NAR’s second-quarter report on home prices showed that 100 of the 155 metro areas surveyed had higher median prices compared with a year earlier. A year earlier, only six areas showed appreciation. Today’s market is full of opportunities for buyers who find themselves in a good financial position. Home prices in some areas remain below replacement construction costs. Even though the home buyer tax credit has expired, record-low mortgage interest rates, along with stable and affordable home prices in most areas, provide opportunities for buyers who weren’t able to take advantage of the credit. Q: With prices down, why would a seller want to put their home on the market? A: If homeowners want to (or need to) sell, the key is to consult with a professional to protect their investment and come up with a strategy to make their home as desirable to buyers as possible. Remember, you want the price of your home to be compelling, not just comparable, and a REALTOR® can help you determine that price. A REALTOR® has the knowledge of the community and of current conditions to ensure that sellers get the best value for their property. The key for sellers is to be flexible. Sellers who want to move up in a buyer’s market will have the opportunity to make up a possible loss on the “buy end.” Q: What is the long-term forecast for the local market? A: Every market is different. (Insert your local market name and info). The markets showing the largest gains in price appreciation are in California and the upper Midwest – areas that had very high levels of distressed homes that were sold at a discount a year earlier. We’re now seeing a more normal mix of sales, so the median price increase seems large in those areas. In reality,

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most of the country is up slightly, with the national median price running 1.5 percent above a year ago. Homeownership has historically been an excellent long-term investment, providing both equity and tax benefits over time, and we see no change in that outlook. The Homebuyer Tax Credit Q: Now that the homebuyer tax credit is over, will the housing market just fall back into a downward spiral? A: The $8,000 tax credit for first-time home buyers and the $6,500 credit for repeat buyers that ended on April 30, 2010 was a resounding success. The credit was just the stimulus that the market needed to get the recovery on track. Home sales rose in every region of the country during the year that the credit was available and inventories trended down for 20 months in a row. The credit helped to stabilize prices, and NAR economists estimate it helped to preserve as much as $1 trillion in largely middle-class housing wealth. The credit also helped to diminish the foreclosures on the market – especially those in the lower price ranges that are attractive to first-time buyers. The credit has given the market momentum. Even without the credit, conditions are still very favorable for buyers – interest rates are low, prices are more affordable than they were three to four years ago and the supply of homes on the market is still relatively high. And don’t forget, those buyers who signed contracts by April 30, now have until the end of September to get them closed and still receive the credit, thanks to an extension pushed by NAR and signed into law in early July. Q. Why did the real estate industry need a bailout to get through this tough time? Don’t real estate agents already make enough money? A. Each home purchase generates about $63,000 of economic activity, as homebuyers take on big-ticket items like new appliances, furniture, carpeting, home improvements, landscaping. Given that the average household income is about $50,000, a home purchase creates the equivalent of about one new job. The return on investment for the federal government and the nation’s taxpayers is significant. While it’s true that REALTORS® earn a commission when they sell a home, this tax credit is much more than an incentive to generate home sales, it’s an investment in the nation’s continued recovery. Financing Q: Hasn’t the subprime mortgage mess made it hard for people to get loans now? A: That’s a common misconception. Lenders are being more diligent about making sure the terms of a mortgage fit a buyer’s financial situation – and that’s a good thing for everyone – but they are still eager to finance home purchases. There are a number of different loan products available today, including FHA loans for as little as 3 percent down. With interest rates at 40-year lows, if you are a qualified buyer, it’s a great time to buy. Q: What type of loan is best for consumers? A: Home buyers should shop for the mortgage that best suits their needs and their financial circumstances. A REALTOR® is uniquely positioned to inform and guide buyers through the maze of financing alternatives. In fact, in today's market where nearly half of all transactions are distressed or short-sales, the REALTOR® is the most experienced at working through the process with the lending institution, seller and other parties involved.

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General Q: If you are looking to sell your home, what should you do to get it ready for sale? and place it on the market? A: The first thing you should do is consult with a REALTOR®. A local REALTOR® will know how to price your home and how to make it appealing to buyers. In this marketplace, it’s important for sellers to remain flexible, rather than stand firm. Sellers who are planning to move up may not get the price they would have three or four years ago, but they will have the opportunity to make up a possible loss by purchasing their next home in today’s “buyer’s market.” Q: If you are looking to buy a home, what are some of the important factors you should consider? A: Location, price and your own personal financial and family situation all play an important role when considering a purchase. Take a look at your financial situation and see what you can sustain over the long-term. Homeownership should be a long-term commitment. REALTORS® can provide you with information about neighborhoods, school districts and realistic pricing because of their vast knowledge of the local community. REALTOR® Questions Q: Aren’t REALTORS® just acting as cheerleaders for the marketplace? A: We want buyers and sellers to know the facts about the market today and over the long term. There are a number of reasons for buyers and sellers to be optimistic about the opportunities in today’s housing market. And, the most important thing is that every market is different. REALTORS® can help buyers and sellers understand what the actual conditions are in your marketplace. Overall, however, prices have moderated, interest rates are at 40-year lows and inventory is abundant. Many market analysts are predicting that interest rates will rise 1 to 2 percentage points by the end of 2010. Now, could be an excellent window of opportunity for buyers. Q: With so many sellers having a tough time in today’s economy, why don’t REALTORS® offer a break on that 6 percent standard commission they charge? A: It’s important to know that there is no standard real estate commission. Commissions are negotiable. Sellers should speak with their REALTOR® about the services they want in marketing and selling their home. The other thing to remember is that today’s transactions are more complex than ever, and using a professional to help you navigate them is the smart thing to do. In some markets, more than half of all sales are short-sales (where the seller owes more than he or she is getting out of the transaction) in which case a REALTOR® can offer invaluable assistance in making sure all parties to the transaction get the best results. Even in so-called “traditional” sales, a REALTOR® provides assistance and guidance to make the transaction successful. Remember, REALTORS® only get paid when the sale closes, so they have an incentive to bring the sale to successful conclusion.

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Homeownership Benefits REALTORS® know that homeownership is an investment in your future. It offers immediate benefits and long-term value. Homeownership strengthens communities. Homeowners are more likely to be involved and engaged in local issues and move less frequently than renters. This helps prevent crime, improve childhood education and support neighborhood upkeep. Owning a home is one of the best ways to build long-term wealth, providing both equity accumulation and tax benefits over time. Some would-be homeowners are playing a wait-and-see game, rationalizing that they may save money by waiting for home prices to fall further. But the problem with trying to time the market is that you can’t time the market.

The truth is, today’s buyers have a lot of advantages. Inventory is high, prices are down and mortgage rates are at near 40-year lows. Homeowners benefit from the power of leverage. Buyers typically use their own money to cover only a small portion of the purchase price, but the home appreciation they realize is based on the total value of the property. A buyer’s first step should be to contact a REALTOR® in their local market who can help them begin to build their future through homeownership. Homeownership is how many American families begin to accumulate wealth. Using the latest figures from the Federal Reserve Board’s Survey of Consumer Finances, NAR estimates that as of 2008, a typical homeowner’s net worth is 49 times that of a renter’s. (Median net worth of $205,200 for owners versus $4,200 for renters.) According to the 2009 NAR Profile of Home Buyers and Sellers, first-time home buyers comprised 47 percent of the market. The previous high was 41percent in 1991. Over 10 years, a $10,000 investment in the stock market at a normal 10 percent market rate of return would yield $23,600. The same investment as a down payment on a $200,000 home at a normal appreciation rate of 5 percent would return nearly five times the stock market return, at $110,300. Homeownership provides important social benefits. It provides shelter and security to families, and fosters involvement in community life as well as participation in democratic institutions. Research reported in the NAR study, Social Benefits of Homeownership and Stable Housing, shows that homeowners are more likely to vote and that they volunteer time for political and charitable causes more frequently than renters.

According to data from the U.S. Census Bureau, owners do not move as frequently as renters, providing more neighborhood stability. In turn, involvement in community quality-of-life issues helps prevent crime, improve childhood education and support neighborhood upkeep. U.S. demographic trends favor housing over the long term. Demand will be driven by increased immigration and the emergence of the echo boomers – children of the baby boomers – as first-time home buyers.

The children of the baby boomer generation, often called echo boomers, are the second largest generation in U.S. history, comprising about 75 million people born from 1982 to 1995. The oldest of these echo boomers are now entering the years in which people typically buy a first home, while the country’s 78 million baby boomers remain in peak earning years.

 

What is a REALTOR®?REALTORS® are licensed real estate professionals who are members of the National Association of REALTORS®, The Voice for Real Estate® . REALTORS® are the most trustedsource for real estate information.

The term REALTOR® is not a generic term; it is a registered collective membership mark that identifies a licensed real estate professional who is a member of NAR. The term REALTOR® is NOT synonymous with “real estate agent.”

There are approximately 3 million licensed real estate professionals in the United States, and 2 million of them are considered “active licensees,” but only 1.2 million are members of NAR. REALTORS® work in both residential and commercial real estate as brokers, salespeople, property managers, appraisers, counselors and others engaged in all aspects of the real estate industry.

There are more than 1,400 local associations and boards and 54 state and territory associations of REALTORS®. Members join NAR through their local REALTOR® association.

REALTORS® subscribe to NAR’s strict Code of Ethics and Standards of Practice, which aimsto protect consumers in the real estate transaction.

The Code stipulates that REALTORS® be honest with all parties involved in a transaction, whether buyer, seller or cooperating agent.

The Code requires REALTORS® to identify and take steps to eliminate practices which may damage the public or which might discredit or dishonor the real estate profession.

REALTORS® must take a refresher training course on the Code of Ethics every four-year cycle. Real estate licensees who join NAR are required to take orientation classes on the Code.

REALTORS® build communities.

The role of REALTORS® in our communities goes far beyond the real estate transaction process of buying and selling. As local business owners and residents, REALTORS® are vested in building healthy and vibrant communities across the country, neighborhood by neighborhood.

As the leading advocates for housing issues, REALTORS® across the country participate in NAR’s Housing Opportunity Program, which provides tools and resources for promoting affordable housing at local, state and national levels.

NAR partners with other real estate industry organizations to promote housing opportunities through the HOPE Awards (Home Ownership Participation for Everyone). The awards recognize REALTORS®,individuals and groups who have made outstanding contributions to increasing minority homeownership.

The Good Neighbor Awards honor REALTORS® who have made an extraordinary commitment to improving the quality of life in their communities through volunteer work. In addition, thousands of

 

REALTORS® volunteer time and resources in community projects organized by their state and local REALTOR® associations.

REALTORS® are the leading advocate for private property rights, homeownership and housing issues.

Every year, NAR leads the way on Capitol Hill and in the corridors of Washington to keep homeownership a top national priority.

NAR’s support for the mortgage interest deduction and other federal policies helps keep housing more affordable and makes housing a great investment. Sound housing policies empower home seekers to purchase a home of their own.

REALTORS® care not only about helping people become homeowners, but also making sure families can keep their homes. They are actively engaged in buyer financing education and in pushing legislation that protects consumers in the real estate transaction.

The Truth Behind Housing Data

The NATIONAL ASSOCIATION OF REALTORS® has the Most

Comprehensive Market Information

NAR first created a real estate index in 1923 – the first organization to officially document real estate market movement. NAR began providing monthly reports on the national existing-home sales market in 1968.

NAR’s existing-home sales series covers the United States and the four major U.S. Census Bureau regions. It is based on a very large monthly sample, representative of 35 to 40 percent of total closed transactions.

Historically, existing-home sales account for 85 percent of residential transactions.

NAR has been reporting quarterly prices for more than 150 metro areas since 1979 and state-by-state sales volume since 1981.

Currently, NAR also reports on existing condo and co-op sales, housing inventory, pending home sales and housing affordability measurements. NAR’s data covers the entire marketplace – high-priced and low-priced – and it is compiled with state-of-the-art statistical tools.

The Data Comes from Multiple Listing Services

NAR relies on timely MLS data to provide the earliest signals about price trends.

Other indices, such as The Case-Shiller Index, for example, rely on data from mortgage securities and county records, which have a significant time lag. Once people close on a home, it could be several months before mortgage securities and county recording offices pick up this information. Consequently, the Case-Shiller Index may display a pattern similar to underlying trends in NAR’s figures, but three months later.

NAR Includes Home Sales and Prices at All Levels

NAR’s price series includes all home sales data from each market – not just sales that are financed a particular way.

NAR covers more than 150 markets, compared with only 20 covered by the Case-Shiller Index.

NAR’s data for the second quarter of 2010 showed that 100 metropolitan markets had positive growth in home prices from the same quarter a year earlier. This is up from just six areas that were showing annual gains in the first quarter..

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Tips to Share

Ten Rules to Follow When Buying a Home

1. Make a commitment. Commit yourself to your new home for at least a couple of years before making your next move.

2. Money matters. If you’re considering a mortgage, shore up your credit and get a copy of your credit report.

3. Get pre-approved. Save yourself the time and grief of looking at houses you can’t afford. 4. Determine how large your mortgage can be. Explore different loan options to determine what is

best for you. 5. Decide what (and where) you want to buy. Prioritize your needs (i.e., location, schools,

amenities). 6. Consider your re-sale value. Even if you don’t have school-aged kids, a strong school district is a

good thing. 7. Do your homework. Bid based on sales trends of similar homes in the neighborhood. 8. Calculate the hidden costs. Property taxes, insurance, maintenance and association fees can

impact your wallet over time. 9. Don’t be house poor. Double and triple check to be sure you haven’t maxed yourself out on the

cost of your home and left nothing for maintenance, etc. 10. Get help. Hire a REALTOR® to get the most for your money. It pays to have someone looking out

for your interests.

Ten Rules to Follow When Selling a Home

1. Hire a good REALTOR®. A professional who knows your neighborhood and has a good track record in your community will go a long way in helping to find a buyer.

2. Clean out the clutter. Open spaces look best. Clean, and clean some more to make a good first impression.

3. Spiff up the property. Make any improvements that will improve the show of your home. When possible, stick with the simpler (and less expensive) options to be sure the buying price covers your investment.

4. Determine the worth. Know the fair market value of your home. Your REALTOR® can help assess the cost. You may also want to have the home appraised.

5. Price it right. A REALTOR® can help you objectively set the price so that it reflects the value of your home and the trends of the surrounding community.

6. Come up with a plan. Are set on your price, or eager to move? How low are you willing to go to settle?

7. Get pre-approved for your next move. If you’re looking to buy another house, make sure you know your financial situation.

8. Figure out your selling costs. Commission, ad costs, attorney fees, taxes and prorated costs may all come into play. REALTORS® deal with transactions every day and can give you a very close estimate of seller closing costs.

9. Set the stage. Clean the windows, open the curtains, turn on the lights, display fresh flowers. A bright house is a welcoming house.

10. It’s show time. Be ready and willing to have your home shown any day, even with short notice. Making it difficult to see will also make it difficult to sell.