Everyone thought that 2000 would be the year of the Y2K disaster and the never-ending economic expansion. There was a technology disaster all right, but it hit the stock market instead. Other factors, including higher fuel prices and the controlling hand of the Fed, slowed the economy perilously close to a "hard landing." (translation:recession) Unbridled optimism eroded over the months to harsh realism. This year is a perfect example of why making predictions about the future is a foolhardy venture, but I can't resist a try anyway. And this time next year, we can all have fun seeing if I was right or wrong.

So here are my predictions for 2001.

Bankers will KO the NAR in the last round

The National Association of REALTORS has lobbied heroically for over 20 years to keep banking interests either through legislation or regulation from providing real estate services. But the banking industry wants a piece of the approximately $908 billion homebuying industry, of which about $136 billion is unrepresented sellers - FSBOs. Banks would be competing directly with real estate brokers to become the first point of contact in the real estate transaction, and could seriously impact the approximately $46 billion paid in real estate brokerage commissions.

A new proposal to get this done is being passed around for comment by the Federal Reserve and could be adopted by summer 2001. Meanwhile, the NAR has worked hard to eliminate or limit fiduciary-level services and their attendant liabilities for real estate brokers through legislative lobbying. With agents now acting as facilitators, it was just a matter of time before other industries would try to cut in on the action.

While the NAR was worrying about liability, other industries are willing to do what real estate brokers are unwilling to do - offer facilitation services at low fees. In an age when many consumers are questioning the veracity of six and seven percent commissions and why it takes up to four real estate professionals (co-brokers, the seller's agent and buyer's agent) to facilitate a transaction, the Federal Reserve will be unmoved by the NAR's argument that Realtors can do a better job for consumers than banks.

Sorry, NAR. You're going to lose this one.

Realtors will become lenders

As soon as the Federal Reserve allows bankers to operate real estate companies and provide real estate services that don't require licensure (I predict that these will be mostly closing services) the real estate community will quit whining about the ethics of whether Realtors should originate loans. They will start flocking to companies like Onepipeline.com and Computer Mortgages of America which train agents to be compliant with RESPA regulations so they can qualify and serve buyers for mortgage loans. In other words, Realtors will do anything to keep their customers out of banks from now on, including boycotting banks that provide transaction services for its FSBO customers.

Web marketing costs will go up, not down

Free Web marketing tools for Realtors are over and that's because they didn't do what they were supposed to do - drive more Realtors to embrace the Internet.

Second, the dotcom fallout has put a lot of companies out of business. When there is less competition, prices inevitably go up. Realtors will pay more for premier positions because there are more homebuyers on the Web than ever, 56 percent according to NAR president Richard Mendenhall.

Third, you will see more mergers and exclusive agreements in 2001 than ever before. Look for those agreements to cost you more money for Web sites and other marketing tools - if you want them to be supplied to your Web sites for you. It's about leveraging traffic and making sales, not providing the lowest cost in tools to Realtors anymore.

Online services will have more accountability

Fear of shaky dotcoms, disdain at higher prices for services, and the wisdom that comes from experience will cause Realtors to be pickier about choosing marketing services in 2001.

Some companies will capitalize on the new Realtor skepticism by providing agents with tools that they haven't had before. One service that will make a lot of news will be lead tracking services because Realtors are going to demand to see some results from their online marketing dollars.

Some smaller Web site companies like Com-stock have been providing lead tracking reports for its customers so they know where leads from their Web sites and listings come from. So far, this has been permission-based lead tracking, but it is an invaluable tool for agents who are planning their marketing budgets and trying to decide which Web sites and other lead generation tools to renew. (That's what Web sites are - renewable subscriptions services.)

Interealty, one of the largest Internet MLS information management system providers, has taken this concept one step further by providing this feature at the MLS level. Brokers can upgrade their MLS access to include a client/transaction/office management platform that opens with a customer/lead report so that agents can see how many click-throughs and e-mails they received from HomeAdvisor or other portals. Again this is lead reporting by permission, but it is useful information, nonetheless. This feature is set to debut in Winter 2001.

They gave an online transaction party, but nobody came

Online transaction management has been delayed by the same kind of competitor-squabbling that is keeping high speed Internet access from gracing every American home. The main problem for TM is language standards. While the NAR and other partners delivered the RETS standard for MLS information, there are still online communication standards that have to be designed and adopted by other industries which are part of the real estate transaction. Some companies are working toward a unified standard for the transaction standard as well as for real estate listings. Until the standards are in place, the online transaction that promises to save all service providers and consumers time and money is only an unfulfilled dream.

Published: December 22, 2000

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.