Leadership and Renewed Momentum of Alabama Real Estate
Leaders of the three groups central to Alabama real estate report improvement in industry performance and licensing of new agents.
Alabama’s real estate market is seeing positive growth this year, with more sales occurring and the average selling price increasing over last year, say Barry Mask (left), Pat Anderson and Grayson Glaze (right).
Growth in sales, improvements in pricing and an increased interest in the career field are all signs that Alabama’s real estate market is moving in the right direction.
“We’ve had three consecutive years of positive sales growth,” says Grayson Glaze, executive director of the Alabama Center for Real Estate, which collects, maintains and analyzes the state’s real estate statistics. In the center’s reports for the first three quarters of 2014, he says, “Year-to-date sales growth is now 2.4 percent over last year.”
Pricing of real estate is also in better territory, with median sales prices showing improvements of about 6 percent over last year. “Overall the market is trending toward equilibrium,” Glaze says.
Specific numbers in these reports show that for the 34,169 homes sold statewide, the median selling price of $131,441, and the average selling price of $156,407 were all improvements over the same time period in 2013. Meanwhile, average days on the market declined to 156 from January-September 2014, compared to 161 from January-September 2013.
Another way to judge the strength of the real estate market is by interest in the career field. The state agency that can weigh in with that piece of information is the Alabama Real Estate Commission, the licensing and regulatory body for the real estate industry in Alabama.
Executive Director Pat Anderson says that her agency has tracked the number of licensing exams given each year since 1974 and notes that the increase and decrease in exam activity over the years corresponds with economic activity. “Together those are numbers and indicators of the strength of the economy,” Anderson says. “The real estate market follows the economy.”
The lowest period since 1982 was in 2011, when the state administered 1,632 tests for salesperson and broker applicants. By 2013, however, that figure had increased to 2,511 applicant tests. “We’re on track this year to have another substantial increase in people being interested in the market,” Anderson says.
The Alabama Center for Real Estate and the Alabama Real Estate Commission, along with the Alabama Association of Realtors, are three statewide organizations working together to strengthen the state’s real estate industry. They collaborate by sharing information and addressing issues while managing their own unique roles and missions.
Regulating the Industry
As the licensing and regulatory body, the Alabama Real Estate Commission is the doorway for individuals and companies entering the profession while it also provides protections for consumers navigating the real estate market.
Becoming a licensed real estate agent in Alabama requires a lengthy process that involves 60 hours of coursework at an approved school prior to taking the licensing exam administered by the commission and another 30 hours of coursework after the exam. Real estate licensees are entered into the commission’s searchable database, which is available to any consumer checking licensing credentials.
As a regulatory body, the commission also provides consumers recourse if real estate professionals violate real estate law. The commission’s legal and investigative divisions check into complaints, and if evidence supports the claim, a licensed agent may have to appear at a commission hearing, which could result in disciplinary action. Anderson says the commission also can regulate non-licensed real estate agents and issue fines if they are operating without a license.
Anderson adds that it’s important that “we as regulators are able to keep up and address the different business models that the real estate agents are using.” Though the commission does have rule-making authority, keeping pace with the industry could require a change in legislation if it goes outside the statute.
“We have to keep up,” Anderson says. “If regulation and industry don’t match, you don’t have a very good situation. We try very hard not to be bureaucratic.”
Supporting the Market
To keep pace with the industry, the commission works closely with the Alabama Association of Realtors. The majority of real estate licensees in Alabama move on to become a Realtor, which takes their professional credentialing to a higher level.
“To be a Realtor is another level of exams and educational requirements by the state and National Association of Realtors,” says Barry Mask, who was named chief executive officer of the AAR in May 2013.
This additional credentialing is important because buying a home, Mask says, “is the most important transaction that usually anyone ever has. It has become an increasingly complicated transaction.”
When agents join the Realtors organization, they become part of a local board, as well as the state and national organizations. In Alabama, there are 29 local boards in communities across the state representing 12,000 members statewide. When consumers enter the real estate market, Mask says, “If they utilize a Realtor, they get a lot broader list of services, greater value, greater guarantees.”
One area that has drawn Mask’s attention is the impact alternate listing sites are having on Internet-based Multiple Listing Service (MLS), an online portal for real estate listings.
“The technology has been challenging,” Mask says. Each local board in the state owns its own MLS, though some boards do partner with others in their region. “With the advent of Zillow and Trulia, that shook up the equation,” Mask says. Zillow and Trulia are both online real estate market sites.
Mask says in national meetings the conversations are about “making sure we protect our data, that we arm our local boards to negotiate fair and equitable listing agreements with Zillow and Trulia, that the listing agent appears first.”
As part of its efforts to promote real estate, the AAR stays in communication with the Alabama Real Estate Commission, as well as the Alabama Center for Real Estate. “We may turn to Grayson’s group (Alabama Center for Real Estate) to do research on a regulatory issue or we may turn to Pat’s group to ask ‘where are you having a problem,’” Mask says. If there are disciplinary issues surfacing, Mask says, they’ll ramp up their education on the issue.
Providing Statistics, Research and Outreach
Both Mask and Anderson serve as ex-officio trustees for the Alabama Center for Real Estate. Housed in the Culverhouse College of Commerce and Business Administration at the University of Alabama, the center is a resource for all things real estate in Alabama — and has been since its inception in 1996. For the last seven years, Glaze has led the organization that is a go-to resource for Alabama real estate statistics, research, forecasting and professional development.
The center also has education and outreach components. “The center creates environments across the state through its education and outreach events that are ripe for students of Alabama’s higher education institutions to network with industry professionals and explore career opportunities,” Glaze says.
Last spring, the Alabama Legislature passed legislation that increased funding for the center. Originally, licensed real estate agents paid a fee of $2.50 per year per license for the center’s support. “Only 20 percent of our operating needs were being carried by the core funding,” Glaze acknowledges.
The new legislation increased the license fee to $7.50 per year per license, and now Glaze is anticipating more research projects, including going deeper into commercial areas. “Whether it’s the consumer, industry or government, the center provides knowledge that’s actionable upon reviewing,” Glaze says.
Minnie Lamberth is a freelance writer and Robert Fouts is a freelance photographer for Business Alabama. Both operate out of Montgomery.