Monday, August 24, 2009
The Trendcast is Right Again!
Too bad there wasn’t a cash bet riding on the predictions.
I’d be cashing in like I had just won the lottery.
Two of my predictions were right on target… right smack on target.
One was part of my 2007 Trendcast.
It was titled “Home Repo. You Can Do It, We Don’t Care.”
It was a prediction that the real estate market would not be down long and the driver of the rebound would be the Millennials who were shortly entering into the first time home-buyers market.
The current issue of Business Week has an article running titled “A Trickle Of Hope For Housing.”
And early on it says… “For the first time since 2004, sales of existing homes have risen for three straight months and at the same time, the inventory of unsold homes has decreased.”
It then showcases Angie Hunter and her husband Craig. They are both in their early 30s and Craig is on active duty with the air force based out of Las Vegas.
As first time homebuyers, the two snatched up a 4-bedroom ranch in a gated community. They got it for $204,000 — nearly half of the $400,000 the previous owners paid for it back in 2005.
Have builders gotten smart yet? … Well I can’t say too much about the locals and the small independent builders.
Case in point… this past weekend, the Athens daily rag newspaper (Athens Banner-Herald) showcased in their Sunday real estate magazine, a planned real estate development that would have a shopping area, a work-from-home office community, coffeehouses and restaurants and a clubhouse complete with pool and tennis courts.
The houses were probably initially listed in the $400K+ range.
Our Athens daily rag set off the story with a tight-cropped picture of the three cluster houses and a second tight-cropped picture of an historic estate home.
Problem is those houses were the only ones built and standing in a vast acreage of vacant lots complete with tall weeds.
Oh and as far as the shopping, offices and country club are concerned; something tells me that it may be a looooonnnnggg time before those enter the amenities experience… if ever.
Hard to believe, but KB Homes has gotten smart.
As the Business Week article states: “To cut its construction costs and make its homes affordable to a broader pool of buyers, KB reengineered how it builds.”
A major share of the homes is built pre-fab and they have revised the floor plans to be smaller and more adapted to flexible use of the Millennial Mindset.
Get this… The company reported a 60% increase in new home orders in second quarter of this year and has orders now for 3,800 homes.
It’s the Millennials folks… and actually just the very first wave of it!
Wachovia is both my personal bank and also the bank for BrandVenture. Bank of America is the Bank that holds both of my homes’ mortgage loans. Both of those banks are barely breathing through the rising waters of foreclosures.
Hard to believe, but a credit union in North Carolina called the North Carolina State Employees’ Credit Union has gotten smart.
The Credit Union execs are expected to write a record $2.5 billion in new mortgages this year. Oh yeah… here’s a stat for you to catch… only 0.5% of the loans the Credit Union has written to date are more than 90 days past due.
How are they doing it?
They are meeting in person with every one who applies for a mortgage loan and “painstakingly build a household budget that determines what the borrower can really afford.”
And if the homeowner falls behind on payments, they grant brief 30-day extensions and also send out a loan rep to help the borrower put together a new budget.
In some ways, they take on the role of the parent.
I think that Credit Union understands what personal banking and what the new Millennial Generation first time homebuyer is all about.
So by now, you are probably wondering what was the second prediction that was right on target… right?
Well… back last summer I talked about how the Democrats were cashing in at the moment on the new Millennial voter block. Also in that Blog-logue, I said that the loyalty — or better put — the interest level — would not last.
Why? Not because they would debate the issues, but more basically, the Millennials are well known to be ADHD (remember that they are the ones that birthed the whole Ritalin craze of the 90s).
Simple terms… in a couple months, something else would be grabbing their attention and Obama would be “old news.”
As Cal Thomas who writes for USA Today noted in an editorial on Sunday…
“Obama’s people thought the youthful enthusiasm of the presidential campaign could be transformed into an army that would roll over opposition to its policy initiatives. So far, that army has been AWOL.”
So much so AMOL, just look around and ask how many folks in their 20s have you seen recently at any of the Healthcare rallies — pro or con?
I am not kidding one bit when I tell you this past week I saw some UGA freshmen replacing their Obama stickers with Wii stickers.
Now your probably asking … while this is all interesting, what does this have to do with my job to sell our brand and generate sales… I don’t work in the housing industry nor the banking industry nor do I work for Wii.
And that answer is simple.
The Millennials are no longer coming…they are here… BIG TIME.
And the models of the past in terms of how people think, how they view reality, what they perceive as reality and how you grab their attention and build equity has all changed.
A couple of brands are getting it.
And a few of the trend folks too!
Get ready… because the 2010 Trendcast is getting posted on our Website on September 28, 2009.
Call me at 404.245.9378 and book a presentation for your brand team!
Hey… we are sometimes telling you something that is right on target…