3rd Quarter Outlook Alabama Real Estate


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3rd Quarter Outlook Alabama Real Estate

  1. 1. Alabama Center for Real Estate Alabama Real Estate Confidence Index®   2nd Annual Summer Roundtable ACRE Leadership Council   Tom Brander, ACRE Council Member Rudulph/Brander Real Estate Reports & Grayson Glaze, Executive Director, ACRE   Thursday, July 29, 2010   Bradley Arant Boult Cummings, LLP  
  2. 2. Calculation of Survey Results <ul><li>The economic and Industry indicators use a five-part scale with the following wording: much better, better, about the same, worse, much worse </li></ul><ul><li>These choices are weighted 100,75,50,25,0 </li></ul><ul><li>Index = ( Σ weighted responses/# surveys) </li></ul><ul><li>Index range is 0 to 100, with 50 as the neutral point, and 0 as much worse </li></ul>
  3. 3. A Quick Summary Q3 2010 <ul><li>Generally the outlook is somewhat unfavorable from last quarter, which was also somewhat unfavorable compared with the 1 st quarter outlook. The Commercial sector has a  more favorable outlook than the Residential all fronts which is a bit of a surprise. While both groups were negative in their outlooks on credit availability the Commercial market participants were less negative. </li></ul>
  4. 4. A Quick Summary Q3 2010 <ul><li>Overall scores by region, there was not a lot of difference between the Suburban-urban markets and the Rural markets. The overall result was influenced by the Coastal outlook but view of the remainder of the state has also been trending down. The expectation for sales in all regions except the coast remain at or above the 50 mark indicating a (very) modestly positive outlook. Inventory is expected to continue to worsen. Credit expectations are quite negative. </li></ul>
  5. 5. Origins of ARECI Survey <ul><li>In the Fall of 2009 ACRE proposed a statewide online survey of Real Estate sentiment, to be conducted quarterly and called the ARECI Real Estate Survey. </li></ul><ul><li>Questions were developed in consultation with the Participation of the leadership board of the Alabama Center For Real Estate at The University of Alabama. </li></ul><ul><li>Alabama all areas of the state have been solicited and sub specialties, such as Residential and Commercial. </li></ul><ul><li>ACRE recruited participants, while the website, survey analysis, and results newsletter were managed by Tom Brander in conjunction with ACRE. </li></ul><ul><li>This initial survey received 637 valid responses well distributed over the four regions of the state. </li></ul>
  6. 6. Survey Design <ul><li>The ARECI survey is forward-looking and asks during the month prior to a new quarter about expectations for change from the current to the upcoming quarter </li></ul><ul><li>There are two general economic indicators: </li></ul><ul><ul><li>Real Estate conditions in the United States </li></ul></ul><ul><ul><li>Real Estate conditions in Alabama </li></ul></ul><ul><li>There are four industry and location specific indicators: </li></ul><ul><ul><li>Sales </li></ul></ul><ul><ul><li>Inventory </li></ul></ul><ul><ul><li>Pricing expectations </li></ul></ul><ul><ul><li>Credit Availability </li></ul></ul>
  7. 7. ARECI panelists <ul><li>Participation is voluntary; panelists register on the survey website </li></ul><ul><li>Panelists recruited by target mailings, association contacts, events, etc. </li></ul><ul><li>Total participation has begun with 637 participants from all four areas of the state </li></ul><ul><li>Targeted Real Estate Professionals; mostly Agents and Brokers, with some Developers and Financing sources </li></ul>
  8. 8. ARECI indices <ul><li>Each quarter the overall index is calculated and a component index is computed for the six variables on the survey. </li></ul><ul><li>Composite indices are also derived for various industry sectors: Residential vs. Commercial </li></ul><ul><li>The index and component indices are calculated for the state’s four regions (North, North Central, South Central, South). </li></ul><ul><li>As our data deepens and we notice significant divergences more indices may be developed. (e.g. Rural vs. Urban) </li></ul>
  9. 9. ARECI Results <ul><li>Results are compiled in a newsletter that is distributed to panelists first and then posted on the ACRE website, http://www.acre.cba.ua.edu/ </li></ul><ul><li>Survey results are also released to the media. </li></ul><ul><li>Presentations made to the ACRE events </li></ul><ul><li>We hope that the survey will raise the awareness of the public about ACRE and the importance of the Real Estate industry. </li></ul>
  10. 10. Comments
  11. 11. Help Us Help You <ul><li>Send comments, questions and suggestions to: [email_address] or of course to gglaze@cba.ua.edu </li></ul><ul><li>Participate in the survey If you have not signed up do so, the link to register is at the top of the ARCE home page. </li></ul><ul><li>PLEASE answer the next survey, for which, you will receive a e-mail to you with a link to click on to take the survey. That is how we will know about your region and specialty. </li></ul>
  12. 12. Next Survey