Virtual Reality is Not the Same as 360-Degree 2D Images

Let’s review the differences between a 360-degree 2D image versus virtual reality. A 360-degree video is a compilation of 2D images connected. A buyer consumes the 2D images that are put in front of them; they cannot take part in what is happening because they are limited to the photos provided. The buyers experience is always the same, as you can’t change the photo sequence, move to a different perspective (other than what is provided), or get a 3D spatial feel of the room.

Virtual Reality is an interactive experience. Buyers can walk around, explore the space and even change the space. Does your project have different finishes? The VR technology allows buyers to switch in and out finishes so they can see the difference.

In VR, buyers are also not limited to a predefined sequence as they can access every aspect and area of the property. A buyer’s decision to interact with a certain area will change their experience. Every buyer is unique; so, during the VR walk through, buyers can focus on what is important to them (i.e. spend more time in the kitchen, master bathroom, or admiring the views from the bedroom). And this is what makes VR technology so engaging and attractive to a buyer.

http://www.360homephoto.com/ Example of a 360 Degree 2D image Home Tour

Virtual Reality tour—envision the project before it is even completed

Why Virtual Reality Works For Real Estate

By embracing the VR transformations, a sales team or real estate professional can shorten the buying journey and help buyers and sellers navigate a purchase of a property while under construction. The main advantages to adopting VR in real estate include:

• Accelerates The Sales Process : While 2D renderings were a technology advancement in sales tools, many buyers have trouble visualizing the property until construction is complete. With VR technology, buyers can virtually “walk-through” the non-existent property, see the finishes, and understand the spacial layout for the property. Buyers don’t need to visualize the property as the technology displays the property as if it was built.

• Cost Effectiveness : VR will eliminate traditional marketing initiatives and provides a cost-effective solution. How many model properties were built for the sales team? What was that cost? Access to VR technology, which gives buyers a similar “walk-through” experience plus the ability to display all finish options, is a cost-effective solution. Alternatively there may not be a model home; the VR walk through would provide a cost-effective marketing solution while the property is under construction.

• Global Reach : Customers can virtually view properties from anywhere in the world, opening up the target market. Is your target market limited to the local audience or throughout the world? Provide access to the VR walk through and anyone can virtually view the property.

• Enhanced Customer Experience : Buyers have freedom to explore the property as they wish. Each buyer is unique and will focus on what is important to them. One buyer may focus on the kitchen while others may focus on the master bathroom, pool, library, media room, etc. Every VR walk through allows buyers to personalize their tour of the property.

• Customer Feedback : With every buyer VR walk-through, sales team members receive key insights into the buyers behavior and preferences, allowing them to improve future interactions with that buyer.

Apple's Big Announcement and Its Impact on Austin

In early December, while all eyes were on Amazon’s HQ2 announcement, Apple made an important one of its own:  the decision to invest $1 billion in a new 133-acre Austin campus that will increase Apple to upwards of 15,000 employees in the coming years. With the completion of this campus, Apple will surpass other well-known names such as H-E-B and Dell to earn the title as the largest private employer in the city of Austin.

The Apple campus will be located right next to its counterpart just over the county line in Williamson County, placing it 12 miles from the city center. It will bring in a good mix of middle to upper range jobs in technology, research and customer call centers. In addition to catapulting Austin into the big leagues as a technology center, the incoming Apple campus will impact all sectors of life, such as housing, restaurants, traffic, and retail marketplaces.  Some estimate that the overall impact of the new Apple campus could result in over 30,000 new jobs across all sectors of real estate, construction, and the marketplace in Austin. 

What impact will this swell of jobs have on the Austin housing market? Prices will continue to rise if more supply is not created to meet these additional demands. As housing prices in the urban core of Austin continue to escalate, look for more incoming Apple employees to search for homes in the Round Rock, Pflugerville, and Hutto areas because of their close accessibility to the Robinson Ranch area (where Apple is located) via SH 45. Other communities that will likely see further development are Liberty Hill and Leader as I-35 will also become a main thoroughfare for Apple employees.

What might the arrival of Apple mean for your housing sale or purchase? If you are shopping in the housing market right now, the answer is simple.  The sooner you can buy, the better.  Competition and prices are only looking to increase. However, if you own a home in North Austin, you might want to hold onto it for a couple more years.  That is, if you can afford its increasing property taxes!

The addition of the new Apple campus will only contribute to Austin’s reputation as a knowledge and talent center and will continue to draw more people from the West Coast who are looking for solid tech jobs in more affordable housing markets.  However, the infrastructure will have to work hard to keep up with the demands of this brand new influx of people to make this a win for all Austinites.

Supply and Demand in the Austin Housing Market

Real estate is a business of supply and demand.  For the past four plus years in Austin, Texas, there has consistently been less than four months’ worth of housing inventory available. Data shows that low supply in the housing market also has driven up the median home price.   

In a relatively short period of time, there’s been a dramatic shift in home sales by price range. In 2011, 67 percent of houses that were sold were priced below $250,000, while 32 percent were priced from $250,000 to just under $1 million. By 2017, those percentages flipped: 63 percent of sales were above $250,000, and 35 percent were below.

The trends of low supply and high demand look to continue as Austin’s population is projected to increase from 1 million in 2014 to an estimated 2.3 million by the end of 2020.  In 2017, Austin saw 151 net new people move to Austin every single day!

In the past 10 years, the median home price in the Austin area has soared as well. In 2018, the Austin median home price was $319,000, up 66 percent from $192,000 in 2008, and median home prices in recent years have seen a year-over-year increase of 5.4%.  In May of 2020, the median home price rose to $424,050 with an average of only 1.7 months of available inventory.

What does all of this mean for the continued growth of the housing market?  There are some that think there will be an inevitable “normalization” of this strong market curve, while others that think the housing market will continue to boom if the city’s economy and job markets continue to prosper. 

What, if anything, could cause a downturn in the market in coming years?  Perhaps another U.S. Presidential election? Other potential factors could be trade/tariff issues, labor shortages, increased traffic and potential water-supply developments as the city continues to expand.  And of course, we have yet to see the full impact of the global pandemic on the housing market.

However, for now, we are enjoying a real estate market that continues to boom with demand significantly higher demand than supply in Austin, Texas. 

Are you wondering what the fair market price of your home is?  Contact me for a complimentary home evaluation today!  

Articles sourced:

1. http://austin.culturemap.com/news/city-life/09-15-15-what-will-austin-look-like-in-2020-new-lawnstarter-report-confirms-rapid-growth/

2. https://www.statesman.com/business/20180627/expert-outlook-bright-for-austin-economy-housing-market

3. https://communityimpact.com/austin/central-austin/development-construction/2018/02/01/austin-housing-market-expected-to-continue-growth-despite-low-supply-and-increasing-interest-rates/

4. https://www.bizjournals.com/austin/news/2018/03/22/austins-population-keeps-popping-heres-how-many.html

Seasonality in Real Estate

While you might not think the seasons of the year have an influence on the price you are paying or asking for your home, it can make a big difference – in some cases, as much as 10%.

Seasonality of Real Estate—What are the Key Factors?

1. Weather-Weather impacts the seasonality of real estate differently, depending on the climate your home is in. For example, in some popular ski resort towns, homes prices can skyrocket during the winter months, while winter impacts the market in other areas negatively. Understanding how the weather and its seasons impacts real estate value is an important consideration both for buying and selling.

 2. School Year- Studies have shown the busiest moving times of the year occur during the summer, with June being one of the busiest months and July 31 the single busiest moving day.  This data means that people are most likely to shop the housing market from the beginning of May through the summer months.

 3. Holidays- Many people do not want to move or uproot their family during the holidays, which essentially eliminates the period between November and January.  Many people do not want to add a move on top of all the extra obligations of the holiday season.  However, as a buyer, the holidays would be a good time to leverage a lower priced market combined with some holiday vacation days! 

What Does Seasonality Mean for Home Buyers? 

For a home buyer, it’s better to buy in an “off season.”   As a buyer in off season, you will have more negotiating room, less competition, and overall lower prices for the houses on the market during the off season. In addition, sellers may be more willing to give more concessions such as money for repairs or a longer closing period in order to firm up a contract on a house during the leaner selling months.

What Does Seasonality Mean for Home Sellers? 

If you are a seller, you want to obviously sell during those summer months, when the competition is fierce and the market is hot.   Multiple offers and bidding wars are your friend as a seller.  However, the downside is that when you are a seller, it usually means that you are also a buyer.   In an ideal world, sell in the spring/summer months to make the most profit on the home that you are selling. Then find a 4-6 month temporary living arrangement that would allow you to wait to buy until the winter or holiday months when seasonality and lower prices are typically on your side as a buyer.

I’m Thinking of Buying/Selling. What Are My Next Steps?

If you are working with a real estate agent, they should be able to provide you with the market metrics for different seasons in your area. By comparing different months and years, you’ll be able to identify where there are significant peaks and lows in your current market and determine when your areas ideal periods for both selling and buying. Interested in the Austin area? Contact me today 512-817-0855. I would be happy to provide you with market trends of any area in Austin and a seasonal analysis of the best time to buy or sell!