Real Estate: Making A Comeback!

By Eva Alsis

It is good news that the Real Estate business is making a comeback, slowly, though.

Such recent news items and review articles pump up confidence in bankers, construction companies, realtors and homebuyers, and also in the other related businesses, including brand design and website making companies.

I am thrilled with this news because Spellbrand has a long, impressive list of clients from Real Estate business, and for the past couple of years or so, realtors have had a troubled time keeping themselves in business as a result of the real estate bubble blow up.

This is great news for graphic designers, website creators and advertisement agencies as well as investors, realtors and property brokers who must sharpen their tools of trade and get ready to reap the real estate harvest! Since the SEO landscape has changed dramatically the past two years, any real estate brand that wants to prosper online will have to look at content marketing, savvy social media engagement and judicial pay per click strategies.

Real estate branding will also become quite important as real estate companies will start realizing that to truly stand out in the crowd, you need to tell the right brand story through the right visual branding. The real estate logo will become a powerful tool to differentiate.

Surprisingly, real estate business is booming in Asian-Pacific countries too. From this region, there are 96 billionaires with real estate being their main or secondary source of cash inflow, the America stands second with about 33 realtor billionaires, and Europe with 21 real estate billionaires stands in the third position. However, country-wise, with 33 ‘real’ real estate billionaires, the States has the first place, followed by China with 30 and Hong Kong with 24. (“The 20 Richest Real Estate Tycoons On The 2015 Forbes Billionaires List” by Erin Carlyle, Forbes Staff, March, 2015 on Forbes Business — Source)

Michelle Cohen in her “Forbes Tallies the World’s Richest Real Estate Tycoons” for 6sqft, April 2015 wrote that 23 more real estate billionaires joined the Forbes real estate billionaire 2015 list, raising the total number to 157, out of which 18 from Asia, 7 from China, 5 from Hong Kong, and the rest from India, Australia, Philippines, Singapore and Taiwan. However, of the top 20 real estate billionaires, only four are from the USA — Stephen Ross ($6.5 billion), Richard LeFrak ($6.4 billion), Donald Bren ($15.2 billion not entirely from real estate) and Stanley Kroenke ($6.3 billion). (“Forbes Tallies the World’s Richest Real Estate Tycoons” by Michelle Cohen, on 6Sqft, April 2015 — Source)

Though there is more noise in other parts of the world, the US is the most favoured country regarding real estate investments. Every rich person in the world wants a piece.

The proof is in Wang Jianlin, the Chinese real estate Mogul and Asia’s richest man with about $ 31.2 billion in assets (even after losing $ 3.6 billion the recent August 2015 China’s ‘Black Monday’ stock fall), pouring tens of billions into the property business in the US. In an interview with Forbes he is heard saying the best comment any American would be proud to hear: “My favorite is its (USA’s) certainty, transparency and fairness” & “America’s (business) policy is not going to change basing on any political party; that’s why I (Wang) love to invest in the States.”. (“Why Asia’s Richest Man Is Investing $10 Billion In America” by Liyan Chen, Forbes Staff; May 2015 — Source)

[More about Wang Jianlin, Asia’s Richest Man, with his two international giant companies, Dalian Wanda Commercial Properties and Wanda Cinema Line, in another writeup.]

Back in 2014, Richard A. Smith, the all-in-all of Realogy Holdings Corp., an international residential real estate franchising and brokerage, expressed his views in an article about how the first-time home buyers were discouraged by the policies of FHA, Federal Housing Administration, USA. He hoped property business would prosper if FHA looked at the housing problem from a different perspective — helping the buyers instead of hurting or scaring them away with heavy-handedness. (“FHA Fees Are Holding Back First-Time Homebuyers” By Richard A. Smith; September 16, 2014 on American Banker — Source)

Real Estate business is so lucrative that even Bill Gates, with assets amounting to $80.1 billion (or $79.2 billion and less $3.2 billion in the August, 2015 China’s ‘Black Monday’ stock fall), has a considerable stake in the US real estate business. His Washington mansion is worth $123 million and one of his horse ranches is worth 18 million. Little known fact is that he has had several property purchases, including ranches and hotels, through his less-talked about investment firm Cascade Investment LLC which has been run by Michael Larson, nick-named ‘Gateskeeper’, for the past 20 years. Gates’ non-tech companies include Canadian National Railway Co., AutoNation Inc., and Republic Services Inc.

In addition to the national and international business giants, Hollywood celebrities and NBA stars buy properties worth millions. Though some of them make losses, there is quite a handsome number of celebrities that enjoy the fruits of the real estate regrowth. ( “Hollywood Celebrities Investing In ‘Real Estate Market’”; Posted by mlca; Jul 21, 2015 on Realty Today — Source)

On the contrary, there is a section of analysts that is worried about another ‘real estate bubble’ and the inevitable burst. However, here is an optimistic view that might console those worried lot:
Though some of the real estate markets in the States ‘overvalued’, according to a report from CoreLogic, Diana Olick in her review “Frothy, yes, but don’t call it a housing bubble” for CNBC news, Sep 2015, assured us that the new developments would not indicate a ‘housing bubble’ because, in her own words, an economic bubble eventually burst, and home prices were very unlikely to fall. She went on to quote Sam Khater, deputy chief economist of CoreLogic, as saying overvalued didn’t mean we were in a bubble and a crash was imminent, and she also quoted John Burns of John Burns Real Estate Consulting as noting that though ‘unsophisticated’ people might panic and ‘alarmists’ might scream ‘bubble’ in some markets, clever executives knew that intrinsic value was a measure of risk. (Source)

Matt in his article “The 10 Worst Celebrities Real Estate Investments Of All Time” on Epic Real Estate, Sep 2013 concluded that investing in real estate with or without money would not necessarily translate to easy or difficult because both methods of investing, he asserted, were not without their challenges, and what was really required for success were the right education and skill. (“The 10 Worst Celebrity Real Estate Investments of All Time” By Matt; September 2013 on Epic Real Estate — Source)