Builder Confidence Moves Higher

 The National Association of Home Builders said builders expect market conditions to improve even with labor shortages and higher building material prices.

WASHINGTON — Builder sentiment improved for the third straight month and builders expect market conditions will continue to improve with as the new administration takes control of the White House and Congress.

Builder confidence in the market for newly built single-family homes was 46 in November, up three points from October, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today.

“With the elections now in the rearview mirror, builders are expressing increasing confidence that Republicans gaining all the levers of power in Washington will result in significant regulatory relief for the industry that will lead to the construction of more homes and apartments,” said NAHB Chairman Carl Harris, a custom home builder from Wichita, Kan. “This is reflected in a huge jump in builder sales expectations over the next six months.”

“While builder confidence is improving, the industry still faces many headwinds such as an ongoing shortage of labor and buildable lots along with elevated building material prices,” said NAHB Chief Economist Robert Dietz. “Moreover, while the stock market cheered the election result, the bond market has concerns, as indicated by a rise for long-term interest rates. There is also policy uncertainty in front of the business sector and housing market as the executive branch changes hands.”

The latest HMI survey also revealed that 31% of builders cut home prices in November. This share has remained essentially unchanged since July, hovering between 31% and 33%. Meanwhile, the average price reduction was 5%, slightly below the 6% rate posted in October. The use of sales incentives was 60% in November, slightly down from 62% in October.

Derived from a monthly survey that NAHB has been conducting for more than 35 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All three HMI sub-indices were up in November. The index charting current sales conditions rose two points to 49, the component measuring sales expectations in the next six months increased seven points to 64 and the gauge charting traffic of prospective buyers posted a three-point gain to 32.

Looking at the three-month moving averages for regional HMI scores, the Northeast increased four points to 55, the Midwest moved three points higher to 44, the South edged up one point to 42 and the West held steady at 41.

Source: National Association of Home Builders

© 2024 Florida Realtors®

Redfin: Big Jump in Existing Home Sales

 October existing home sales rose 1.6% month over month and are on track to finish this year higher than last year.

SEATTLE — Existing home sales rose 1.6% month over month in October — the biggest gain since January 2022 — to a seasonally adjusted annual rate of 4,179,346, according to a new report from the real estate brokerage Redfin. They climbed 1.7% year over year — the first annual increase since November 2021—and are on track to finish the year slightly higher than they finished last year (4,093,102).

Overall home sales, which include sales of both existing and newly built homes, also posted a notable increase. They rose 1.6% month over month and 3.4% year over year to the highest level in over a year and a half on a seasonally adjusted basis.

The median home sale price increased 5.2% year over year to $435,313 in October — the biggest annual gain in six months.

Home sales jumped in October because mortgage rates had just hit the lowest level in two years, giving buyers more purchasing power. The Federal Reserve had also just made news by cutting its benchmark interest rate and outlining plans for future cuts. Redfin agents say some buyers entered the market because they assumed the Sep. 18 decision would cause mortgage rates to plunge, though by this point, most of the decline had already happened.

The average interest rate on a 30-year-fixed mortgage bottomed at 6.08% during the week ending September 26. Noticing that rates were falling, many Americans started touring homes and making offers in September, which is why pending home sales jumped that month. Many of those pending transactions were finalized in October, fueling last month’s rise in home sales. But the rise in pending sales didn’t last into October.

Pending sales dipped in October amid jump in mortgage rates, election uncertainty

Pending sales fell 1.1% month over month on a seasonally adjusted basis in October. That’s largely because mortgage rates shot up last month, erasing much of the newfound purchasing power buyers gained over the summer. Mortgage rates now sit at 6.78% — near the highest level since July. Demand was also likely sluggish last month because many prospective buyers decided to hold off until after the presidential election, and others were recovering from hurricanes in the Southeast.

Some homebuyers got cold feet as economic uncertainty and election jitters gripped the country; roughly 53,000 home purchases were canceled in October, equal to 15.5% of homes that went under contract last month. That’s the highest percentage in nearly a year.

“Homebuyers came off the sidelines when mortgage rates dropped, but now that rates spiked back up, things have slowed down again,” said Stayce Mayfield, a Redfin Premier real estate agent in St. Louis. “That’s partly because not all buyers who came off the sidelines actually locked in a rate, so now they’re saying, ‘Well wait, now I’m getting quoted 7% when I thought I was going to get 6%.’ Sellers are grappling with the same issue; those who locked in low rates during the pandemic and were considering selling and buying a new home are now wondering if they missed the boat.”

The mortgage-rate rollercoaster isn’t expected to end anytime soon. Rates will continue to see-saw as investors try to suss out the impact of a Trump presidency, and they’ll likely stay elevated if President Trump moves forward with higher tariffs and tax cuts, according to Redfin Economics Research Lead Chen Zhao.

Early signs that demand is recovering post-election

Redfin is seeing early signs that demand has begun to recover now that the election is over. Demand from homebuyers requesting service through Redfin’s site was about 25% higher this past weekend than the same weekend last year – the largest year-over-year gain since the downturn began in 2022.

While pending sales fell from a month earlier in October, they rose 3.5% from a year earlier – the third consecutive year-over-year gain. That, along with the uptick in existing home sales, is what indicates that existing home sales are on pace to end this year higher than last year.

Typical home took 41 days to sell – the slowest October pace in five years

The typical home that sold in October spent 41 days on the market. That’s one week slower than a year earlier and is the longest of any October since 2019. Just over one-third (35%) of homes that sold last month went under contract within two weeks, down from 40.4% a year earlier and the lowest October share since 2019.

Redfin agents say listings often sit on the market because they’re overpriced, which has led to a pile-up of stale listings; active listings of homes for sale rose to the highest seasonally adjusted level in four years last month.

“Buyers have more information than they’ve ever had about pricing and previous sales, and they want to know that what they’re getting is worth it for the price. That’s why sellers need to price fairly in this market,” said Cory Kirkland, a Redfin Premier agent in Columbus, OH. “Sellers are asking buyers to pay $500,000 for a home they bought in 2020 for $350,000 and didn’t put any work into, and buyers are saying no.”

Just over one-quarter (27.7%) of homes that sold in October went for more than their asking price, down from 31.7% a year earlier and the lowest October share since 2019.

Metro-level highlights: October 2024

• Prices: Median sale prices rose most from a year earlier in Milwaukee (13.6%), Fort Lauderdale, FL (13.3%) and St. Louis (12.2%). They fell in just two metros: Austin, TX (-3.4%) and San Antonio (-1.3%).
• Pending sales: Pending sales rose most in San Jose, CA (32.1%), San Francisco (25.3%) and Oakland, CA (22%). They fell most in Tampa, FL (-24.5%), West Palm Beach, FL (-15.7%) and Fort Lauderdale (-12.3%).
• Closed home sales: Home sales rose most in Seattle (26.9%), Sacramento, CA (20.1%) and Portland, OR (18.3%). They fell most in Fort Lauderdale (-16.3%), Tampa (-15.6%) and Miami (-14.1%).
• New listings: New listings rose most in Seattle (23.5%), Anaheim, CA (17.5%) and Sacramento (17.4%). They fell most in Tampa (-27.3%), Atlanta (-14.5%) and West Palm Beach (-11.7%).
• Active listings: Active listings rose most in Cincinnati (39.7%), Fort Lauderdale (36.6%) and San Diego (36.5%). They fell in two metros: New York (-4.4%) and Atlanta (-1.4%).
• Sold above list price: In San Jose, 64.4% of homes sold above their final list price, the highest share among the metros Redfin analyzed. Next came Newark, NJ (62.5%) and San Francisco (60.8%). The lowest shares were in West Palm Beach (6.2%), Miami (9.2%) and Fort Lauderdale (10%).

Source: Redfin

© 2024 Florida Realtors®

First-Time Buyers at 24%, Age Hits Record High

 A record high 26% of buyers paid cash for their home and 17% purchased a multigenerational home, according to NAR’s new 2024 buyers and sellers profile.

WASHINGTON — The first-time homebuyer market share decreased to a historic low of 24% (down from 32% last year), while home buyers’ ages hit all-time highs of 56 years overall (49 last year), 38 years for first-time buyers (35 last year) and 61 years for repeat buyers (58 last year), according to the National Association of Realtors®' 2024 Profile of Home Buyers and Sellers.

This annual survey of recent home buyers and sellers – this year tracking transactions between July 2023 and June 2024 – has been NAR's flagship report since it first published in 1981, providing industry professionals insight into detailed homebuying and selling behavior.

“The U.S. housing market is split into two groups: first-time buyers struggling to enter the market and current homeowners buying with cash,” said Jessica Lautz, NAR deputy chief economist and vice president of research. “First-time buyers face high home prices, high mortgage interest rates and limited inventory, making them a decade older with significantly higher incomes than previous generations of buyers. Meanwhile, current homeowners can more easily make housing trades using built-up housing equity for cash purchases or large down payments on dream homes.”

The typical home buyer’s median household income for 2023 rose to $108,800 from $107,000 in 2022. First-time buyers had a median household income of $97,000, up from $95,900 the prior year and an increase of $26,000 in the last two years. Repeat buyers had a median household income of $114,300, up from $111,700 the previous year.

The share of married couples increased to 62% of all buyers, with single female buyers seeing a slight rise to 20%. Conversely, the share of single males decreased to 8% and unmarried couples dropped to 6%. In addition, the share of single female first-time buyers jumped by 5%.

Eighty-three percent of recent home buyers identified their ethnicity as White or Caucasian. Seven percent of recent buyers identified as Black/African American, 6% identified as Hispanic/Latino, 4% identified as Asian/Pacific Islander and 3% as some other ethnicity.

Seventy-three percent of recent home buyers did not have a child under the age of 18 in their home – the highest share recorded.

Seventeen percent of home buyers purchased a multigenerational home, the highest share in the data series. The top reasons cited were cost savings (36%), to take care of aging parents (25%), children over the age of 18 moving back home (21%), and children over the age of 18 who never left home (20%).

“As home buyers encounter an unaffordable housing market, many are choosing to double up as families,” explains Lautz. “Cost savings are a major factor, with young adults returning home – or never leaving – due to prohibitive rental and home prices. Meanwhile, elderly parents and relatives are moving in with family members as home buyers reprioritize what matters most to them.”

Real estate agents played a crucial role in the homebuying process, with 86% of all buyers utilizing their services – the highest of all information sources used. Agents were the most useful information source in the home search process.

Eighty-eight percent of home purchases were made through a real estate agent or broker, demonstrating the continued importance of agents in the homebuying process. Nearly 90% of buyers each expressed satisfaction with their agent’s responsiveness, knowledge of the purchase process, honesty and integrity, knowledge of the real estate market and people skills. Eighty-eight percent of home buyers would use their agent again or recommend to others.

In 2024, the median down payments were 18% for all home buyers, 9% for first-time home buyers and 23% for repeat home buyers – the highest down payments for first-time home buyers since 1997 and repeat home buyers since 2003. First-time buyers continue to rely on savings (69%); however, 25% used loans or gifts from friends and family, 21% used financial assets and an all-time high of 7% used inheritances. A record 26% of home buyers paid cash for their homes.

The typical age of home sellers reached 63 years, the highest ever recorded. The share of married couples selling their homes was 69%, an increase from 65% last year, marking the first increase in four years.

For sellers, the most cited reason for selling their home was the desire to move closer to friends and family (23%), followed by home was too small (12%), home was too large (11%) and neighborhood becoming less desirable (10%).

“Family support systems are influencing buying and selling decisions,” said Lautz. “Being close to friends and family is the top reason to sell, while buying a home convenient to friends and family continues to grow in importance. Today’s buyers are less likely to be concerned with their work locations when purchasing, perhaps because of a higher share of older repeat buyers and remote work flexibility remaining a factor.”

Ninety percent of sellers sold with the assistance of a real estate agent, up from 89% last year, and only 6% were for-sale-by-owner sales, an all-time low. Most sellers (87%) said that they would definitely (72%) or probably (15%) recommend their agent for future services.

“Most home buyers and sellers find it valuable to use an agent who is a Realtor® to help them maneuver through the complicated homebuying and selling processes, especially in a challenging housing market,” said NAR President Kevin Sears, broker-associate of Sears Real Estate/Lamacchia Realty in Springfield, Massachusetts. “Realtors® provide critical knowledge and expertise that ensure a successful transaction.”

Methodology

Data gathered in the report is based on primary residence home buyers. In July 2024, NAR mailed out a 127-question survey using a random sample weighted to be representative of sales on a geographic basis to 167,750 recent home buyers. The buyers must have purchased a primary residence home between July 2023 and June 2024. NAR received 5,390 responses from primary residence buyers. After accounting for undeliverable questionnaires, the survey had an adjusted response rate of 3.2%. Per the Realtor Confidence Index, 83% of home buyers were primary residence buyers in 2023, which accounts for 4,756,000 homes sold in 2023 (among new and existing homes). Using that calculation, the sample at the 95% confidence level has a confidence interval of plus-or-minus 1%.

© 2024 National Association of Realtors® (NAR)

Contract Signings Signal Market Improvements

 By Melissa Dittman Tracey

NAR Chief Economist Lawrence Yun forecasts improved home sales, slower appreciation and falling mortgage rates over the next two years.

CHICAGO — More home buyers signed contracts for a home purchase in September, a sign that the housing market may be on the mend after a sluggish summer.

The National Association of Realtors®’ Pending Home Sales Index  a forward-looking indicator of home sales based on contract signings — jumped by 7.4% in September compared to August, NAR reported Wednesday. Contract signings also were up 2.6% from a year ago.

“Contract signings rose across all regions of the country as buyers took advantage of the combination of lower mortgage rates in late summer and more inventory choices,” says NAR Chief Economist Lawrence Yun. Pending sales rose by nearly 10% in the West last month, followed by a 7.1% gain in the Midwest, 6.7% increase in the South, and 6.5% gain in the Northeast. “Further gains are expected if the economy continues to add jobs, inventory levels grow, and mortgage rates hold steady,” Yun says.

Sales of newly constructed and previously owned homes could rise by 10% in each of the next two years, Yun predicts, noting that “sizable pent-up housing demand” is likely to be unleashed in the coming years. First, however, the housing market must dig itself out of a rut: Existing-home sales hit a 14-year low in September as prospective home buyers pull back due to high prices.

What likely triggered more contract signings

Home buyers in September found more inventory options, which may have helped boost pending home sales last month. Housing inventory was up 23% in September compared to a year ago, although that’s still down by about 25% from pre-COVID levels, according to NAR.

The uptick in contract signings last month also came as the Federal Reserve cut its benchmark interest rate for the first time in four years. The Fed’s rate is not directly tied to mortgage rates, but the cut initially encouraged movement in the market and helped bring mortgage rates down to 6.18% in September (compared to 6.5% in August). The lower rates may have created some urgency among home buyers. The September drop in rates translated to about a $300 savings in monthly mortgage payments on a typical $300,000 mortgage compared to just a few months ago, NAR’s data shows.

That said, mortgage rates have moved upwards in recent weeks: The 30-year fixed-rate mortgage averaged 6.54% last week, according to Freddie Mac.

So, will the latest sales uptick last?

Yun believes home sales will continue to climb, particularly as home affordability improves. Here’s what he predicts for the housing market over the next two years:

• Higher home sales: “After two years of sluggish home sales in 2023 and 2024, existing-home sales are forecasted to rise,” Yun says. He predicts existing-home sales to increase to 4.47 million in 2025 and to more than 5 million in 2026.
• Slower home price appreciation: “During the next two years, expect a slower rate of growth in home prices that’s roughly in line with the consumer price index because of additional supply reaching the market,” he adds. Yun predicts the median sale price for existing homes to increase to $410,700 in 2025 and $420,000 in 2026. However, the pace of home price hikes is slowing, he says.
• Falling mortgage rates: Further helping home affordability, Yun also predicts that the 30-year fixed-rate mortgage will decrease to 5.9% in 2025. However, he says mortgage rates likely will increase to a 6.1% average by 2026.

Click here to read Yun’s full housing forecast.

© 2024 National Association of Realtors® (NAR)

FHFA House Price Index Up 0.3% in August

 Housing prices increased 4.2% from last year nationwide, the Federal Housing Finance Agency said. Price appreciation remained modest for the 6th month.

WASHINGTON — U.S. house prices rose 0.3% in August, according to the Federal Housing Finance Agency's (FHFA) seasonally adjusted monthly House Price Index (HPI). House prices rose 4.2% from August 2023 to August 2024. The previously reported 0.1% price increase in July was revised upward to 0.2% .

For the nine census divisions, seasonally adjusted monthly price changes from July 2024 to August 2024 ranged from -0.1% in the East North Central and New England divisions to +0.9% in the West North Central division. The 12-month changes were all positive, ranging from +2.4% in the West South-Central division to +6.3% in the East North Central division.

In the South Atlantic division, which includes Florida, seasonally adjusted monthly price changes from July 2024 to August 2024 increased 0.1% with a 12-month increase of 3.7%

"House price appreciation in the United States remained modest for the sixth consecutive month," said Dr. Anju Vajja, deputy director for FHFA’s Division of Research and Statistics. "The slow but continued house price growth and the effect of locked-in interest rates led to persistent housing affordability challenges."

The FHFA HPI is a comprehensive collection of publicly available house price indexes that measure changes in single-family home values based on data that extend back to the mid-1970s from all 50 states and over 400 American cities. It incorporates tens of millions of home sales and offers insights about house price changes at the national, census division, state, metro area, county, ZIP code, and census tract levels. FHFA uses a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze house price transaction data.

Source: FHFA

© 2024 Florida Realtors®

Pending Home Sales Advanced 7.4% in September

 Pending home sales bounced 7.4% to the highest level since March; they're up 2.6% YoY. In the South, pending home sales improved, NAR said. 

WASHINGTON — Pending home sales rose in September, according to the National Association of Realtors®. All four major regions experienced month-over-month gains in transactions. Year-over-year, the Northeast and West registered increases while sales remained steady in the Midwest and South.

The Pending Home Sales Index (PHSI) – a forward-looking indicator of home sales based on contract signings – jumped 7.4% to 75.8 in September, the highest level since March (78.3). Year-over-year, pending transactions ascended 2.6%. An index of 100 is equal to the level of contract activity in 2001.

“Contract signings rose across all regions of the country as buyers took advantage of the combination of lower mortgage rates in late summer and more inventory choices,” said NAR Chief Economist Lawrence Yun. “Further gains are expected if the economy continues to add jobs, inventory levels grow, and mortgage rates hold steady.”

NAR economic and housing outlook

In the next two years, Yun foresees slower home price appreciation and corresponding increases in sales.

“After two years of sluggish home sales in 2023 and 2024, existing-home sales are forecasted to rise to 4.47 million in 2025 and more than 5 million in 2026,” Yun said. “During the next two years, expect a slower rate of growth in home prices that’s roughly in line with the consumer price index because of additional supply reaching the market.”

Yun predicts the median existing-home price will rise to $410,700 in 2025 and to $420,000 in 2026. The annual 30-year fixed mortgage rate will slide to 5.9% in 2025 but then move higher to 6.1% in 2026.

Pending home sales regional breakdown

The Northeast PHSI expanded 6.5% from last month to 65.6, up 3.3% from September 2023. The Midwest index surged 7.1% to 75.0 in September, identical to the previous year.

The South PHSI improved 6.7% to 89.0 in September, unchanged from a year ago. The West index rose 9.8% from the prior month to 64.0, up 12.3% from September 2023.

The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

Pending contracts are good early indicators of upcoming sales closings. However, the amount of time between pending contracts and completed sales is not identical for all home sales. Variations in the length of the process from pending contract to closed sale can be caused by issues such as buyer difficulties with obtaining mortgage financing, home inspection problems, or appraisal issues.

The index is based on a sample that covers about 40% of multiple listing service data each month. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

© 2024 National Association of Realtors® (NAR)

Understanding Cybersecurity Risks in Real Estate

 By Brandon Rickwood and Aaron Jackson

Cybercriminals will go to great lengths to gain access to your personal and sensitive information. Be ready by having a plan to reduce risk.

NEW YORK —Your real estate firm is at risk from the growing threat of cybersecurity attacks. The days of retaining hard copies and physical files are increasingly phasing out. In an era where digital transformation is altering the industry landscape, real estate firms are becoming progressively more vulnerable to cybersecurity threats due to the sensitive information they maintain. While firms are adopting digital solutions to streamline operations, close transactions faster and improve the customer experience to ease streamlining operations, doing so also makes them prime targets for cybercriminals. As the frequency and sophistication of cyberattacks grow, real estate firms and professionals must understand the risks and implement robust security measures to protect themselves from the escalating threat of cybercrime.

Cybersecurity threats facing real estate firms

Real estate firms are particularly vulnerable to various cybersecurity threats due to the sensitive nature of the information they manage. From phishing attacks and social engineering to data breaches and ransomware, it is important to be cognizant of the most common cybersecurity threats your real estate firm may encounter.

Phishing attacks

"Phishing" remains one of the most prevalent threats facing real estate professionals and firms. Cybercriminals use deceptive emails or messages to trick individuals into divulging sensitive information such as login credentials and/or financial information. It is increasingly common to receive emails or messages from attackers posing as "trusted colleagues" or "trusted clients" asking for immediate action on an urgent matter.

Social engineering

Similar to "phishing" attempts, social engineering tactics involve manipulating individuals into divulging confidential information. In the real estate industry, attackers might impersonate clients or colleagues through phone calls, emails, or other forms of communication to establish trust and gain access to sensitive data or financial resources.

Data breaches and ransomware

Data breaches are also a common occurrence where unauthorized parties access confidential information, such as personal identification details, financial records, and/or transaction histories. Additionally, ransomware attacks that hold firms' encrypted data hostage are rapidly becoming an ever-present threat. There were nearly 318 million ransomware attacks in 2023 alone, and researchers estimate that such attacks will increase to one attack every two seconds by the year 2031.1 Real estate firms maintaining a significant amount of sensitive data are prime targets for such attacks.

Given the present threats and future predictions, it is critical for your real estate firm to prioritize this threat. Cybercriminals will go to inexhaustible lengths to gain unauthorized access to your personal and sensitive information. You must be ready for the attack.

How cybersecurity attacks impact real estate transactions

Cybersecurity threats pose a broad risk to real estate transactions, with significant implications for a real estate firm's financial stability, reputation, and legal compliance.

Financial repercussions can be catastrophic as firms grapple with the costs of ransoms, data breach remediation, potential regulatory fines, legal fees and lost business opportunities. Such attacks can be economically devastating to large firms and catastrophic to smaller firms.

The exposure of sensitive and secure information can result in severe legal consequences, class action lawsuits, data loss, compliance issues, and financial fraud to name a few. Ransomware incidents stifle operations, resulting in significant financial losses and downtime. On September 12, 2023, MGM Resorts confirmed that it suffered a ransomware attack that forced the shut-down of several operational systems, which amounted to $100M in losses according to SEC filings.2

Beyond the immediate monetary losses, a cybersecurity incident can also damage a firm's reputation, as trust and reliance are essential in real estate dealings. Clients provide personal and financial records throughout the real property transaction, which flow through financial and broker institutions to complete the deals. Any breach of client data and/or disruption of services can lead to negative publicity, delayed transaction processing, a decline in clientele, and/or the refusal of lenders and financial institutions to work with the breached firm. In this environment, prioritizing cybersecurity is not just a technical necessity but a critical component of maintaining financial health, client trust, and regulatory adherence.

Best practices for enhancing cybersecurity in real estate

Considering the cybersecurity threats posed to real estate firms and their customers, it is important to highlight the mitigation strategies that real estate firms and individuals should apply to avoid such threats. As the most practical strategy, educating employees about the best cybersecurity practices is essential. Recommendations include the following:

• Educating employees is vital to maintaining sound cybersecurity. Firms should conduct regular training sessions with employees and agents to help them understand how to: 1) safely operate online, 2) identify and avoid cyber threats, and 3) handle and secure sensitive information.
• Using encrypted communication methods and strong multi-factor authentication measures for sharing information can also help protect against unauthorized access and add an extra layer of security for attackers attempting to gain such access.
• Ensuring regular software updates, routinely backing up data and establishing recovery plans further address vulnerabilities that may be exploited by attackers.
• Developing and enforcing clear policies along with executing robust security protocols are also important to combat any existing risks and can defend against future threats.

In conjunction with these best practices, it is vital to ensure the firm's readiness by establishing a robust incident response plan to execute in the event of any cyberattack.

Conclusion

As real estate firms continue to embrace digital solutions, the importance of cybersecurity cannot be overstated. By understanding the threats and implementing best practices, firms can protect their operations, safeguard client information, and maintain their reputation in an increasingly digital world. Caution, awareness, and proactive measures are key to traversing the complex landscape of cybersecurity in real estate.

© Mondaq Ltd, 2024