2019 Real Estate Forecast: What Home Buyers, Sellers And Investors Can Expect
An illustration of a house sinking into the water.
GETTY
There’s no doubt about it: the 2018 housing market has seen its ups and downs.
The year started with sky-high home prices, historically low mortgage rates and a definitive upper hand for sellers. In recent months though, home price growth has faltered, rates have risen to their highest point in nearly eight years, and favor has started to shift from seller to buyer.
Will these trends continue? Will housing experience the same wild ride in the new year? Here’s what experts predict will happen in 2019 real estate market:
Mortgage rates will continue rising.
“Despite steady climbing for the past two years, mortgage rates remain lower than they were during most of the recession and below average for the type of strong economic growth we’ve been experiencing. That will change in 2019, as the 30-year, fixed rate mortgage reaches 5.8% — territory not seen since the dark days of 2008 when rates were racing downward in response to the housing crisis.” — Aaron Terrazas, director of economic research for Zillow
Millennials will keep buying homes — despite those rising rates.
"The housing market in 2019 will be characterized by continued rising mortgage rates and surging millennial demand. Rising rates, by making housing less affordable, will likely deter certain potential homebuyers from the market. On the other hand, the largest cohort of millennials will be turning 29 next year, entering peak household formation and home-buying age, and contributing to the increase in first-time buyer demand.” — Odeta Kushi, senior economist for First American
“Millennials will continue to make up the largest segment of buyers next year, accounting for 45% of mortgages, compared to 17% of Boomers, and 37% of Gen Xers. While first-time buyers will struggle next year, older Millennial move-up buyers will have more options in the mid-to upper-tier price point and will make up the majority of Millennials who close in 2019. Looking forward, 2020 is expected to be the peak Millennial home buying year with the largest cohort of millennials turning 30 years old. Millennials are also likely to make up the largest share of home buyers for the next decade as their housing needs adjust over time.” — Danielle Hale, chief economist for Realtor.com
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This graphic shows the role Millennials will play in the 2019 and 2020 housing markets.
COURTESY OF REALTOR.COM
Home buying power will decrease, but that could be a good thing.
“Most homebuyers budget a monthly payment. As rates rise, a fixed monthly payment translates into less borrowing capacity and buying power is down about 10% since the same time last year. As there are less buyers at each price point, the appropriate market response is a slowdown in sales and an easing in price momentum.” — Tendayi Kapfidze, chief economist for LendingTree
Overall home sales will drop.
“As we look toward 2019, we are anticipating home sales to decline around 2%. We’re expecting it to be another slightly slower year as buyers continue to wrangle with higher mortgage rates after contending with several years of rapid price growth.” — Ruben Gonzalez, chief economist at Keller Williams
Inventory troubles will ease — not too much, though.
“The wave of first-time home buyer demand will be met by somewhat higher inventory levels than in 2018. However, while the days of multiple offers and bidding wars may be history in some markets where inventory is increasing, inventory will likely still remain tight nationally through 2019." — Kushi
“In the majority of markets, the number of homes being put on the market or newly constructed has increased slightly, while the pace of sales has slowed slightly, which has helped stop the inventory decline. But the inventory increases or slowing price increases necessary for a more widespread sales gain are not forecasted to happen in 2019. While the situation is not getting worse for buyers, it’s also not improving notably in the majority of markets.” — Hale
This graphic shows housing inventory predictions for 2019.
COURTESY OF REALTOR.COM
Home price growth will continue to slow.
“Right now, for 2019, we believe home price appreciation will likely slow to near 3%. This is based on the assumption that the recent pattern of increasing inventory levels will be sustained in the upcoming year.” — Gonzalez
Buyers will see less competition, but that might not help first-timers.
“Buyers who are able to stay in the market will find less competition as more buyers are priced out but feel an increased sense of urgency to close before it gets even more expensive. Their largest struggle next year will be reconciling wants, needs and budget versus the heavy competition of 2018. Although the number of homes for sale is increasing, which is an improvement for buyers, the majority of new inventory is focused in the mid- to higher-end price tier, not entry-level.” — Danielle Hale, Realtor.com
National rents will rise, but apartment construction could ease renters’ pains.
“As higher rates limit the number of homes that potential buyers can afford, some would-be buyers will be too financially stretched to buy and will continue renting. As a result, recent (and very slight) drops in rent will reverse and turn positive again. The shift will be muted, however, by continued steady investment in apartment construction, which will prevent rent growth from shooting too far above income growth.” — Terrazas
NYC rent hikes will continue — thanks to Amazon.
“Overall, I think the beginning of 2019 will be relatively flat, with price increases in Q3, Q4 and into 2020. The period between the old 421A and the beginning of affordable New York was a window of time where there wasn’t a tremendous amount of rental development. During that time it was difficult to build rental developments due to the escalating land and construction costs, no tax incentives, etc., creating a shortage of new product. Today, not only have some regulations changed, but the economy is doing well, unemployment rates are down, a lot of jobs are being created here in New York – not only by Amazon but everything that comes along with Amazon and all of the corporations looking to be close proximity to their headquarters. When we see the economy doing well, we can expect rental prices to increase.” — Andrew Barrocas, CEO of MNS
Individual and institutional investors will battle it out.
“Well-funded institutional buyers have tremendous advertising budgets and their spend makes it impossible for the average real estate investor to compete. It takes a serious financial investment to fund a marketing campaign that accurately targets and identifies acquisition opportunities. That alone gives institutional investors an instant advantage. Additionally, interest rates are increasing, which not only impacts buyers who cannot afford to move, but also individual investors looking to borrow money to buy and hold rental properties. Their cost to borrow increases while inventory decreases and competition grows. This type of combination middle-market is one individual investors do not want to see.” — Brian Spitz, founder of Big State Home Buyers
Commercial property managers will hop on the shared space bandwagon — or bring in top amenities to make up for it.
“As co-working continues to be a disruptor in commercial real estate, the largest traditional landlords have opened their own flexible and co-working options to compete, such as Sage Realty's Swivel and Boston Properties' Flex. Landlords who are remaining or returning to the traditional commercial office space are facing increased demand for amenities like sleek lobbies, tech services, etc. To meet these demands and gain a competitive edge, landlords are opening up to fintech/insurtech solutions like replacing security deposits with surety bonds to make tenants lives easier.” — Julien Bonneville, CEO of The Guarantors
Technology will continue to disrupt the industry.
“Technology disruption of the real estate industry driven by Silicon Valley and institutional investors will reach a point where it’ll threaten the traditional real estate industry. Technological innovation is here and rapidly advancing in the real estate industry and preparing for disruption. iBuying, blockchain, artificial intelligence and machine learning are changing the ways buyers, sellers and investors interact with each other and the properties they are interested in.” — Spitz
This graphic shows the top technologies experts predict will be adopted in 2019.
COURTESY OF FIRST AMERICAN
The Moral of the Story
All in all, housing is set for a slow-down next year, but as Kapfidze explained, that’s not necessarily a bad thing.
“The medium and long-term prospects for housing are good because demographics are going to continue to support demand,” he said. “With a slower price appreciation, incomes have an opportunity to catch up. With slower sales, inventory has an opportunity to normalize. A slowdown in 2019 creates a healthier housing market going forward.”
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120,429 views Reach Higher Will Host Annual Beating the Odds Summit For First-Generation College-Bound Students
Reach Higher will continue the summer tradition of hosting the annual Beating the Odds Summit to support first-generation college-bound students. Mrs. Obama has been joined in the past by celebrities and advocates like Elaine Welteroth (author and former editor-in-chief of Teen Vogue), Daveed Diggs (Hamilton: An American Musical), La La Anthony (Power), Dan Porterfield (CEO and President of The Aspen Institute), Wes Moore (author and CEO of Robin Hood), and Jidenna (musical artist).
CHUCK KENNEDY
Beating the Odds was first celebrated in 2014 at the White House with a small group of students from across the country in a closed-door roundtable with Mrs. Obama. She celebrated their commitment to education despite overcoming immense obstacles along their journey to higher education. During the summer of 2015 and 2016, Mrs. Obama expanded the small gathering to include over 100 college-bound students representing urban, rural, foster, homeless, special needs, and underrepresented youth who had beaten the odds to overcome incredible obstacles to persist through high school and commit to attending a postsecondary institution.
First-generation college-bound students will participate in a day-long workshop focused on strategies to succeed in college and ways to build a foundation for a meaningful career starting freshman year. As in previous years, the panels will be livestreamed and available to be viewed by students around the country. More details about the event will be announced soon on @ReachHigher and @BetterMakeRoom’s social media accounts.
High school graduation is a big step in the life of a young person. Students make a plan for their futures and assume the best. However, ten to 20 percent of students who make a concrete commitment to go to college never make it. Financial burden, fear of leaving home, and enrollment requirements are a few factors that lead to this lead to this loss of potential and talent, a phenomenon known as “summer melt.” Summer melt is a “when seemingly college-intending students fail to enroll at all in the fall after high school graduation.” In some communities, as many as 40 percent of students who intend to go to college never get there. Caring adults and strong systems of support must help students to stay on track, stay committed to attending, and remind them to complete all of the necessary tasks to start college on the first day of classes.
Beating the Odds is an event to commemorate, support, and encourage recent high school graduates on their way to college. For students to beat the odds, they need targeted support during the summer before college so they arrive prepared academically, socially, and emotionally to succeed. This year, Reach Higher is encouraging you to plan a Beating the Odds Summit at your school, on your campus, or in your community as a way to support students who have overcome obstacles to go to college. It is also a time to keep students on track to be ready on day one. You can download the toolkit and register your event at reachhigher.org.
“Mrs. Obama, as a first-generation student herself, knows what it feels like to head off to college without the same support system as others,” says Eric Waldo, executive director of Reach Higher. “Pursuing post-secondary education opens doors for students and helps them reach their full potential. We’re thrilled to celebrate Beating the Odds and ensure more first-generation and underrepresented students enter college with the information and tools they need to succeed in class and in their career.”
The founders initially limited the website's membership to Harvard students and subsequently Columbia, Stanford, and Yale students. Membership was eventually expanded to the remaining Ivy Leagueschools, MIT, and higher education institutions in the Boston area, then various other universities, and lastly high school students. Since 2006, anyone who claims to be at least 13 years old has been allowed to become a registered user of Facebook, though this may vary depending on local laws. The name comes from the face book directories often given to American university students. Facebook held its initial public offering (IPO) in February 2012, valuing the company at $104 billion, the largest valuation to date for a newly listed public company. Facebook makes most of its revenue from advertisements that appear onscreen and in users' News Feeds.
The Facebook service can be accessed from devices with Internetconnectivity, such as personal computers, tablets and smartphones. After registering, users can create a customized profile revealing information about themselves. They can post text, photos and multimedia which is shared with any other users that have agreed to be their "friend". Users can also use various embedded apps, join common-interest groups, and receive notifications of their friends' activities. Facebook claimed that had more than 2.3 billion monthly active users as of December 2018.However, it faces a big problem of fake accounts. It caught 3 billion fake accounts, but the ones it misses are the real problem. Many critics questioned whether Facebook knows how many actual users it has. Facebook is one of the world's most valuable companies.
It receives prominent media coverage, including many controversies. These often involve user privacy (as with the Cambridge Analytica data scandal), political manipulation (as with the 2016 U.S. elections), psychological effects such as addiction and low self-esteem, and content that some users find objectionable, including fake news, conspiracy theories, and copyright infringement.[16] Facebook also does not remove false information from its pages, which brings continuous controversies.[17] The commentators stated that Facebook helps to spread false information and fake news.
2003–2006: Thefacebook, Thiel investment, and name change
Zuckerberg built a website called "Facemash" in 2003 while attending Harvard University. The site was comparable to Hot or Not and used "photos compiled from the online facebooks of nine Houses, placing two next to each other at a time and asking users to choose the "hotter" person".Facemash attracted 450 visitors and 22,000 photo-views in its first four hours.The site was sent to several campus group list-servers, but was shut down a few days later by Harvard administration. Zuckerberg faced expulsion and was charged with breaching security, violating copyrights and violating individual privacy. Ultimately, the charges were dropped. Zuckerberg expanded on this project that semester by creating a social study tool ahead of an art history final exam. He uploaded all art images to a website, each of which was accompanied by a comments section, then shared the site with his classmates
Original layout and name of Thefacebook, 2004
A "face book" is a student directory featuring photos and personal information.In 2003, Harvard had only a paper versionalong with private online directories.Zuckerberg told the Crimson, "Everyone's been talking a lot about a universal face book within Harvard. ... I think it's kind of silly that it would take the University a couple of years to get around to it. I can do it better than they can, and I can do it in a week." In January 2004, Zuckerberg coded a new website, known as "TheFacebook", inspired by a Crimson editorial about Facemash, stating, "It is clear that the technology needed to create a centralized Website is readily available ... the benefits are many." Zuckerberg met with Harvard student Eduardo Saverin, and each of them agreed to invest $1,000 in the site.On February 4, 2004, Zuckerberg launched "TheFacebook", originally located at thefacebook.com.
Six days after the site launched, Harvard seniors Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra accused Zuckerberg of intentionally misleading them into believing that he would help them build a social network called HarvardConnection.com. They claimed that he was instead using their ideas to build a competing product. The three complained to the Crimson and the newspaper began an investigation. They later sued Zuckerberg, settling in 2008for 1.2 million shares (worth $300 million at Facebook's IPO).
In mid-2004, Napster co-founder and entrepreneur Sean Parker—an informal advisor to Zuckerberg—became company president. In June 2004, the company moved to Palo Alto, California.It received its first investment later that month from PayPal co-founder Peter Thiel.In 2005, the company dropped "the" from its name after purchasing the domain namefacebook.com for US$200,000. The domain had belonged to AboutFace Corporation.
In May 2005, Accel Partners invested $12.7 million in Facebook, and Jim Breyeradded $1 million of his own money. A high-school version of the site launched in September 2005. Eligibility expanded to include employees of several companies, including Apple Inc. and Microsoft.
2006–2012: Public access, Microsoft alliance, and rapid growth
On September 26, 2006, Facebook opened to everyone at least 13 years old with a valid email address. By late 2007, Facebook had 100,000 pages on which companies promoted themselves. Organization pages began rolling out in May 2009. On October 24, 2007, Microsoft announced that it had purchased a 1.6% share of Facebook for $240 million, giving Facebook a total implied value of around $15 billion. Microsoft's purchase included rights to place international advertisements.
In October 2008, Facebook announced that its international headquarters would locate in Dublin, Ireland. In September 2009, Facebook said that it had achieved positive cash flow for the first time. A January 2009 Compete.com study ranked Facebook the most used social networking service by worldwide monthly active users.
The company announced 500 million users in July 2010. Half of the site's membership used Facebook daily, for an average of 34 minutes, while 150 million users accessed the site from mobile devices. A company representative called the milestone a "quiet revolution." In November 2010, based on SecondMarket Inc. (an exchange for privately held companies' shares), Facebook's value was $41 billion. The company had slightly surpassed eBay to become the third largest American web company after Google and Amazon.com.
On November 15, 2010, Facebook announced it had acquired the domain name fb.com from the American Farm Bureau Federation for an undisclosed amount. On January 11, 2011, the Farm Bureau disclosed $8.5 million in "domain sales income", making the acquisition of FB.com one of the ten highest domain sales in history.
In February 2011, Facebook announced plans to move its headquarters to the former Sun Microsystems campus in Menlo Park, California. In March 2011, it was reported that Facebook was removing about 20,000 profiles daily for violations such as spam, graphic content and underage use, as part of its efforts to boost cyber security. Statistics showed that Facebook reached one trillion page views in the month of June 2011, making it the most visited website tracked by DoubleClick.According to a Nielsen study, Facebook had in 2011 become the second-most accessed website in the U.S. behind Google.[
China blocked Facebook in 2009
2012–2013: IPO, lawsuits, and one-billionth user
In March 2012, Facebook announced App Center, a store selling applications that operate via the website. The store was to be available on iPhones, Android devices, and mobile web users.In April 2012, Facebook acquired Instagram for approximately US$1 billion in cash and stock.
Facebook's initial public offering came on May 17, 2012, at a share price of US$38. The company was valued at $104 billion, the largest valuation to that date. The IPO raised $16 billion, the third-largest in U.S. history, after Visa Inc. in 2008 and AT&T Wireless in 2000. Based on its 2012 income of $5 billion, Facebook joined the Fortune 500 list for the first time in May 2013, ranked 462.[74] The shares set a first day record for trading volume of an IPO (460 million shares).The IPO was controversial given the immediate price declines that followed.and was the subject of lawsuits,while SEC and FINRA both launched investigations.
Billboard on the Thomson Reutersbuilding welcomes Facebook to NASDAQ, 2012
Zuckerberg announced at the start of October 2012 that Facebook had one billion monthly active users, including 600 million mobile users, 219 billion photo uploads and 140 billion friend connections.
2013–2014: Site developments, A4AI, and 10th anniversary
On January 15, 2013, Facebook announced Facebook Graph Search, which provides users with a "precise answer", rather than a link to an answer by leveraging data present on its site. Facebook emphasized that the feature would be "privacy-aware", returning results only from content already shared with the user. On April 3, 2013, Facebook unveiled Facebook Home, a user-interface layer for Android devices offering greater integration with the site. HTC announced HTC First, a phone with Home pre-loaded.
On April 15, 2013, Facebook announced an alliance across 19 states with the National Association of Attorneys General, to provide teenagers and parents with information on tools to manage social networking profiles. On April 19 Facebook modified its logo to remove the faint blue line at the bottom of the "F" icon. The letter F moved closer to the edge of the box.
Following a campaign by 100 advocacy groups, Facebook agreed to update its policy on hate speech. The campaign highlighted content promoting domestic violence and sexual violence against women and led 15 advertisers to withdrawal, including Nissan UK, House of Burlesque and Nationwide UK. The company initially stated, "while it may be vulgar and offensive, distasteful content on its own does not violate our policies". It took action on May 29.
On June 12, Facebook announced that it was introducing clickable hashtags to help users follow trending discussions, or search what others are talking about on a topic. San Mateo County, California, became the top wage-earning county in the country after the fourth quarter of 2012 because of Facebook. The Bureau of Labor Statistics reported that the average salary was 107% higher than the previous year, at $168,000 a year, more than 50% higher than the next-highest county, New York County (better known as Manhattan), at roughly $110,000 a year.
Facebook joined Alliance for Affordable Internet (A4AI) in October, as it launched. The A4AI is a coalition of public and private organizations that includes Google, Intel and Microsoft. Led by Sir Tim Berners-Lee, the A4AI seeks to make Internet access more affordable to ease access in the developing world.On October 13, Facebook acquired Onavo, an Israeli mobile web analytics company. Standard & Poor's added Facebook to its S&P 500 index on December 21.
In February 2014, Facebook announced that it would be buying mobile messaging company WhatsApp for US$19 billion in cash and stock.
In 2014, Facebook bought Oculus VR for $2.3 billion in stock and cash,[99] which released its first consumer virtual reality headset in 2016.
The company celebrated its 10th anniversary during the week of February 3, 2014.In January 2014, over one billion users connected via a mobile device.As of June, mobile accounted for 62% of advertising revenue, an increase of 21% from the previous year. By September Facebook's market capitalization had exceeded $200 billion.
Zuckerberg participated in a Q&A session at Tsinghua University in Beijing, China, on October 23, where he attempted to converse in Mandarin. Zuckerberg hosted visiting Chinese politician Lu Wei, known as the "Internet czar" for his influence in China's online policy, in December 8.
2015–present: Fake news, vaccine hesitancy, and Christchurch shooting
As of January 21, 2015, Facebook's algorithm was revised in an attempt to filter out false or misleading content, such as fake news stories and hoaxes. It relied on users who flag a story accordingly. Facebook maintained that satirical content should not be intercepted The algorithm was accused of maintaining a "filter bubble", where material the user disagrees withand posts with few likes would be deprioritized. In November, Facebook extended paternity leave from 4 weeks to 4 months.
On April 12, 2016, Zuckerberg outlined his 10 year vision, which rested on three main pillars: artificial intelligence, increased global connectivity and virtual/augmented reality. In June, Facebook announced Deep Text, a natural language processing AI that learns user intent and context in 20 languages. In July, a US$1 billion suit was filed against the company alleging that it permitted Hamas to use it to perform assaults that cost the lives of four people. Facebook released its blueprints of Surround 360 camera on GitHub under an open-source license. In September, it won an Emmy for its animated short "Henry". In October, Facebook announced a fee-based communications tool called Workplace that aims to "connect everyone" at work. Users can create profiles, see updates from co-workers on their news feed, stream live video and participate in secure group chats.
Following the 2016 presidential election, Facebook announced that it would combat fake news by using fact checkers from sites like FactCheck.org and Associated Press (AP), making reporting hoaxes easier through crowdsourcing, and disrupting financial incentives for abusers.
On January 17, 2017, Facebook COO Sheryl Sandberg planned to open Station F, a startup incubator campus in Paris, France. On a six-month cycle, Facebook committed to work with ten to 15 data-driven startups there.On April 18, Facebook announced the beta launch of Facebook Spaces at its annual F8 developer conference. Facebook Spaces is a virtual reality version of Facebook for Oculus VR goggles. In a virtual and shared space, users can access a curated selection of 360-degree photos and videos using their avatar, with the support of the controller. Users can access their own photos and videos, along with media shared on their newsfeed. In September, Facebook announced it would spend up to US$1 billion on original shows for its Facebook Watch platform. On October 16, it acquired the anonymous compliment app tbh, announcing its intention to leave the app independent.
In May 2018 at F8, the company announced it would offer its own dating service. Shares in competitor Match Group fell by 22%. Facebook Dating includes privacy features and friends will be unable to view their friends' dating profile. In July, Facebook was charged £500,000 by UK watchdogs for failing to respond to data erasure requests. On July 18, Facebook established a subsidiary named Lianshu Science & Technology in Hangzhou City, China, with $30 million of capital. All its shares are held by Facebook Hong. Approval of the registration of the subsidiary was then withdrawn, due to a disagreement between officials in Zhejiang province and the Cyberspace Administration of China. On July 26, Facebook became the first company to lose over $100 billion worth of market capitalization in one day, dropping from nearly $630 billion to $510 billion after disappointing sales reports. On July 31, Facebook said that the company had deleted 17 accounts related to the 2018 American elections. On September 19, Facebook announced that, for news distribution outside the United States, it would work with U.S. funded democracy promotion organizations, International Republican Institute and the National Democratic Institute, which are loosely affiliated with the Republican and Democratic parties. Through the Digital Forensic Research Lab Facebook partners with the Atlantic Council, a NATO-affiliated think tank. In November, Facebook launched smart displays branded Portal and Portal Plus (Portal+). They support Amazon's Alexa (intelligent personal assistant service). The devices include video chat function with Facebook Messenger.
In January 2019, the 10 year challenge was startedasking users to post a photograph of themselves from 10 years ago (2009) and a more recent photo.
Criticized for its role in vaccine hesitancy, Facebook announced in March 2019 that it would provide users with "authoritative information" on the topic of vaccines.
On March 14, Huffington Post reported that Facebook’s PR agency had paid someone to tweak Facebook COO Sheryl Sandberg’s Wikipedia page, as well as adding a page for the global head of PR, Caryn Marooney
In March 2019, the perpetrator of the Christchurch mosque shootings in New Zealand used Facebook to stream live footage of the attack as it unfolded. Facebook took 29 minutes to detect the livestreamed video, which was eight minutes longer than it took police to arrest the gunman. About 1.3m copies of the video were blocked from Facebook but 300,000 copies were published and shared. Facebook has promised changes to its platform; spokesman Simon Dilner told Radio New Zealand that it could have done a better job. Several companies, including the ANZ and ASB banks, have stopped advertising on Facebook after the company was widely condemned by the public.[140] Following the attack, Facebook began blocking white nationalist, white supremacist, and white separatist content, saying that they could not be meaningfully separated. Previously, Facebook had only blocked overtly supremacist content. The older policy had been condemned by civil rights groups, who described these movements as functionally indistinct. Further bans were made in mid-April 2019, banning several British far-right organizations and associated individuals from Facebook, and also banning praise or support for them.
In early-April 2019, Facebook announced that it would be pulling its apps from Windows Phone on April 30, 2019, including Facebook, Messenger and Instagram.
NTJ's member Moulavi Zahran Hashim, a radical Islamistimam believed to be the mastermind behind the 2019 Sri Lanka Easter bombings, preached on a pro-ISIL Facebook account, known as "Al-Ghuraba" media.
In May 2019, Facebook founded Libra Networks, reportedly in order to develop their own stablecoincryptocurrency. In recent developments it has been reported that Libra is being supported by financial companies like Visa, Mastercard, PayPal and Uber. The consortium of companies is expected to pool in $10 million each to fund the launch of the cryptocurrency coin named Libra.
On May 2, 2019 at F8, the company announced its new vision with the tagline "the future is private".A redesign of the website and mobile app was introduced, dubbed as "FB5". The event also featured plans for improving groups, a dating platform,end-to-end encryption on its platforms,and allowing users on Messenger to communicate directly with WhatsApp and Instagram users.
On July 3, 2019, Facebook's option to view and load pictures stopped working as people around the world complained. Facebook posted on Twitter about the issue and said they would resolve it as soon as they could.
As of December 31, 2018, Facebook had 35,587 employees.
Board of directors
In April 2019, Facebook nominated Peggy Alford to be added as a board member during the May 2019 AGM. If this happens, she will become the first African-American woman to serve in this board, and the second African-American ever to do so.As of April 2019, Facebook's board consists of the following directors;
The founders initially limited the website's membership to Harvard students and subsequently Columbia, Stanford, and Yale students. Membership was eventually expanded to the remaining Ivy Leagueschools, MIT, and higher education institutions in the Boston area, then various other universities, and lastly high school students. Since 2006, anyone who claims to be at least 13 years old has been allowed to become a registered user of Facebook, though this may vary depending on local laws. The name comes from the face book directories often given to American university students. Facebook held its initial public offering (IPO) in February 2012, valuing the company at $104 billion, the largest valuation to date for a newly listed public company. Facebook makes most of its revenue from advertisements that appear onscreen and in users' News Feeds.
The Facebook service can be accessed from devices with Internet connectivity, such as personal computers, tablets and smartphones. After registering, users can create a customized profile revealing information about themselves. They can post text, photos and multimedia which is shared with any other users that have agreed to be their "friend". Users can also use various embedded apps, join common-interest groups, and receive notifications of their friends' activities. Facebook claimed that had more than 2.3 billion monthly active users as of December 2018.However, it faces a big problem of fake accounts. It caught 3 billion fake accounts, but the ones it misses are the real problem.Many critics questioned whether Facebook knows how many actual users it has.Facebook is one of the world's most valuable companies.
It receives prominent media coverage, including many controversies. These often involve user privacy (as with the Cambridge Analytica data scandal), political manipulation (as with the 2016 U.S. elections), psychological effects such as addiction and low self-esteem, and content that some users find objectionable, including fake news, conspiracy theories, and copyright infringement. Facebook also does not remove false information from its pages, which brings continuous controversies. The commentators stated that Facebook helps to spread false information and fake news.
2003–2006: Thefacebook, Thiel investment, and name change
Zuckerberg built a website called "Facemash" in 2003 while attending Harvard University. The site was comparable to Hot or Not and used "photos compiled from the online facebooks of nine Houses, placing two next to each other at a time and asking users to choose the "hotter" person" Facemash attracted 450 visitors and 22,000 photo-views in its first four hours.The site was sent to several campus group list-servers, but was shut down a few days later by Harvard administration. Zuckerberg faced expulsion and was charged with breaching security, violating copyrights and violating individual privacy. Ultimately, the charges were dropped. Zuckerberg expanded on this project that semester by creating a social study tool ahead of an art history final exam. He uploaded all art images to a website, each of which was accompanied by a comments section, then shared the site with his classmates.
Original layout and name of Thefacebook, 2004
A "face book" is a student directory featuring photos and personal information.In 2003, Harvard had only a paper versionalong with private online directories.Zuckerberg told the Crimson, "Everyone's been talking a lot about a universal face book within Harvard. ... I think it's kind of silly that it would take the University a couple of years to get around to it. I can do it better than they can, and I can do it in a week." In January 2004, Zuckerberg coded a new website, known as "TheFacebook", inspired by a Crimson editorial about Facemash, stating, "It is clear that the technology needed to create a centralized Website is readily available ... the benefits are many." Zuckerberg met with Harvard student Eduardo Saverin, and each of them agreed to invest $1,000 in the site. On February 4, 2004, Zuckerberg launched "TheFacebook", originally located at thefacebook.com.
Six days after the site launched, Harvard seniors Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra accused Zuckerberg of intentionally misleading them into believing that he would help them build a social network called HarvardConnection.com. They claimed that he was instead using their ideas to build a competing product.The three complained to the Crimson and the newspaper began an investigation. They later sued Zuckerberg, settling in 2008 for 1.2 million shares (worth $300 million at Facebook's IPO).
In mid-2004, Napster co-founder and entrepreneur Sean Parker—an informal advisor to Zuckerberg—became company president. In June 2004, the company moved to Palo Alto, California. It received its first investment later that month from PayPal co-founder Peter Thiel In 2005, the company dropped "the" from its name after purchasing the domain namefacebook.com for US$200,000.The domain had belonged to AboutFace Corporation.
In May 2005, Accel Partners invested $12.7 million in Facebook, and Jim Breyeradded $1 million of his own money. A high-school version of the site launched in September 2005.[ Eligibility expanded to include employees of several companies, including Apple Inc. and Microsoft.
2006–2012: Public access, Microsoft alliance, and rapid growth
On September 26, 2006, Facebook opened to everyone at least 13 years old with a valid email address. By late 2007, Facebook had 100,000 pages on which companies promoted themselves. Organization pages began rolling out in May 2009.On October 24, 2007, Microsoft announced that it had purchased a 1.6% share of Facebook for $240 million, giving Facebook a total implied value of around $15 billion. Microsoft's purchase included rights to place international advertisements.
In October 2008, Facebook announced that its international headquarters would locate in Dublin, Ireland. In September 2009, Facebook said that it had achieved positive cash flow for the first time. A January 2009 Compete.com study ranked Facebook the most used social networking service by worldwide monthly active users.
The company announced 500 million users in July 2010. Half of the site's membership used Facebook daily, for an average of 34 minutes, while 150 million users accessed the site from mobile devices. A company representative called the milestone a "quiet revolution."In November 2010, based on SecondMarket Inc. (an exchange for privately held companies' shares), Facebook's value was $41 billion. The company had slightly surpassed eBay to become the third largest American web company after Google and Amazon.com
On November 15, 2010, Facebook announced it had acquired the domain name fb.com from the American Farm Bureau Federation for an undisclosed amount. On January 11, 2011, the Farm Bureau disclosed $8.5 million in "domain sales income", making the acquisition of FB.com one of the ten highest domain sales in history.
In February 2011, Facebook announced plans to move its headquarters to the former Sun Microsystems campus in Menlo Park, California. In March 2011, it was reported that Facebook was removing about 20,000 profiles daily for violations such as spam, graphic content and underage use, as part of its efforts to boost cyber security.Statistics showed that Facebook reached one trillion page views in the month of June 2011, making it the most visited website tracked by DoubleClick.[63][64] According to a Nielsen study, Facebook had in 2011 become the second-most accessed website in the U.S. behind Google.
China blocked Facebook in 2009.
2012–2013: IPO, lawsuits, and one-billionth user
In March 2012, Facebook announced App Center, a stre selling applications that operate via the website. The store was to be available on iPhones, Android devices, and mobile web users. In April 2012, Facebook acquired Instagram for approximately US$1 billion in cash and stock.
Facebook's initial public offering came on May 17, 2012, at a share price of US$38. The company was valued at $104 billion, the largest valuation to that date. The IPO raised $16 billion, the third-largest in U.S. history, after Visa Inc. in 2008 and AT&T Wireless in 2000. Based on its 2012 income of $5 billion, Facebook joined the Fortune 500 list for the first time in May 2013, ranked 462.The shares set a first day record for trading volume of an IPO (460 million shares).The IPO was controversial given the immediate price declines that followed. and was the subject of lawsuits,while SEC and FINRA both launched investigations.
Billboard on the Thomson Reutersbuilding welcomes Facebook to NASDAQ, 2012
Zuckerberg announced at the start of October 2012 that Facebook had one billion monthly active users, including 600 million mobile users, 219 billion photo uploads and 140 billion friend connections.
2013–2014: Site developments, A4AI, and 10th anniversary
On January 15, 2013, Facebook announced Facebook Graph Search, which provides users with a "precise answer", rather than a link to an answer by leveraging data present on its site. Facebook emphasized that the feature would be "privacy-aware", returning results only from content already shared with the user. On April 3, 2013, Facebook unveiled Facebook Home, a user-interface layer for Android devices offering greater integration with the site. HTC announced HTC First, a phone with Home pre-loaded.
On April 15, 2013, Facebook announced an alliance across 19 states with the National Association of Attorneys General, to provide teenagers and parents with information on tools to manage social networking profiles. On April 19 Facebook modified its logo to remove the faint blue line at the bottom of the "F" icon. The letter F moved closer to the edge of the box.
Following a campaign by 100 advocacy groups, Facebook agreed to update its policy on hate speech. The campaign highlighted content promoting domestic violence and sexual violence against women and led 15 advertisers to withdrawal, including Nissan UK, House of Burlesque and Nationwide UK. The company initially stated, "while it may be vulgar and offensive, distasteful content on its own does not violate our policies". It took action on May 29.
On June 12, Facebook announced that it was introducing clickable hashtags to help users follow trending discussions, or search what others are talking about on a topic. San Mateo County, California, became the top wage-earning county in the country after the fourth quarter of 2012 because of Facebook. The Bureau of Labor Statistics reported that the average salary was 107% higher than the previous year, at $168,000 a year, more than 50% higher than the next-highest county, New York County (better known as Manhattan), at roughly $110,000 a year.
Facebook joined Alliance for Affordable Internet (A4AI) in October, as it launched. The A4AI is a coalition of public and private organizations that includes Google, Intel and Microsoft. Led by Sir Tim Berners-Lee, the A4AI seeks to make Internet access more affordable to ease access in the developing world. On October 13, Facebook acquired Onavo, an Israeli mobile web analytics company. Standard & Poor's added Facebook to its S&P 500 index on December 21.
In February 2014, Facebook announced that it would be buying mobile messaging company WhatsApp for US$19 billion in cash and stock.
In 2014, Facebook bought Oculus VR for $2.3 billion in stock and cash,[99] which released its first consumer virtual reality headset in 2016.
The company celebrated its 10th anniversary during the week of February 3, 2014. In January 2014, over one billion users connected via a mobile device.As of June, mobile accounted for 62% of advertising revenue, an increase of 21% from the previous year. By September Facebook's market capitalization had exceeded $200 billion.
Zuckerberg participated in a Q&A session at Tsinghua University in Beijing, China, on October 23, where he attempted to converse in Mandarin. Zuckerberg hosted visiting Chinese politician Lu Wei, known as the "Internet czar" for his influence in China's online policy, in December 8.
2015–present: Fake news, vaccine hesitancy, and Christchurch shooting
As of January 21, 2015, Facebook's algorithm was revised in an attempt to filter out false or misleading content, such as fake news stories and hoaxes. It relied on users who flag a story accordingly. Facebook maintained that satirical content should not be intercepted. The algorithm was accused of maintaining a "filter bubble", where material the user disagrees with and posts with few likes would be deprioritized. In November, Facebook extended paternity leave from 4 weeks to 4 months.[109]
On April 12, 2016, Zuckerberg outlined his 10 year vision, which rested on three main pillars: artificial intelligence, increased global connectivity and virtual/augmented reality. In June, Facebook announced Deep Text, a natural language processing AI that learns user intent and context in 20 languages. In July, a US$1 billion suit was filed against the company alleging that it permitted Hamas to use it to perform assaults that cost the lives of four people. Facebook released its blueprints of Surround 360 camera on GitHub under an open-source license. In September, it won an Emmy for its animated short "Henry". In October, Facebook announced a fee-based communications tool called Workplace that aims to "connect everyone" at work. Users can create profiles, see updates from co-workers on their news feed, stream live video and participate in secure group chats.
Following the 2016 presidential election, Facebook announced that it would combat fake news by using fact checkers from sites like FactCheck.org and Associated Press (AP), making reporting hoaxes easier through crowdsourcing, and disrupting financial incentives for abusers.
On January 17, 2017, Facebook COO Sheryl Sandberg planned to open Station F, a startup incubator campus in Paris, France. On a six-month cycle, Facebook committed to work with ten to 15 data-driven startups there. On April 18, Facebook announced the beta launch of Facebook Spaces at its annual F8 developer conference. Facebook Spaces is a virtual reality version of Facebook for Oculus VR goggles. In a virtual and shared space, users can access a curated selection of 360-degree photos and videos using their avatar, with the support of the controller. Users can access their own photos and videos, along with media shared on their newsfeed. In September, Facebook announced it would spend up to US$1 billion on original shows for its Facebook Watch platform. On October 16, it acquired the anonymous compliment app tbh, announcing its intention to leave the app independent.
In May 2018 at F8, the company announced it would offer its own dating service. Shares in competitor Match Group fell by 22%. Facebook Dating includes privacy features and friends will be unable to view their friends' dating profile.[127] In July, Facebook was charged £500,000 by UK watchdogs for failing to respond to data erasure requests. On July 18, Facebook established a subsidiary named Lianshu Science & Technology in Hangzhou City, China, with $30 million of capital. All its shares are held by Facebook Hong.[129] Approval of the registration of the subsidiary was then withdrawn, due to a disagreement between officials in Zhejiang province and the Cyberspace Administration of China. On July 26, Facebook became the first company to lose over $100 billion worth of market capitalization in one day, dropping from nearly $630 billion to $510 billion after disappointing sales reports. On July 31, Facebook said that the company had deleted 17 accounts related to the 2018 American elections. On September 19, Facebook announced that, for news distribution outside the United States, it would work with U.S. funded democracy promotion organizations, International Republican Institute and the National Democratic Institute, which are loosely affiliated with the Republican and Democratic parties.Through the Digital Forensic Research Lab Facebook partners with the Atlantic Council, a NATO-affiliated think tank. In November, Facebook launched smart displays branded Portal and Portal Plus (Portal+). They support Amazon's Alexa (intelligent personal assistant service). The devices include video chat function with Facebook Messenger.
In January 2019, the 10 year challenge was started asking users to post a photograph of themselves from 10 years ago (2009) and a more recent photo.
Criticized for its role in vaccine hesitancy, Facebook announced in March 2019 that it would provide users with "authoritative information" on the topic of vaccines.
On March 14, Huffington Post reported that Facebook’s PR agency had paid someone to tweak Facebook COO Sheryl Sandberg’s Wikipedia page, as well as adding a page for the global head of PR, Caryn Marooney.
In March 2019, the perpetrator of the Christchurch mosque shootings in New Zealand used Facebook to stream live footage of the attack as it unfolded. Facebook took 29 minutes to detect the livestreamed video, which was eight minutes longer than it took police to arrest the gunman. About 1.3m copies of the video were blocked from Facebook but 300,000 copies were published and shared. Facebook has promised changes to its platform; spokesman Simon Dilner told Radio New Zealand that it could have done a better job. Several companies, including the ANZ and ASB banks, have stopped advertising on Facebook after the company was widely condemned by the public.[140] Following the attack, Facebook began blocking white nationalist, white supremacist, and white separatist content, saying that they could not be meaningfully separated. Previously, Facebook had only blocked overtly supremacist content. The older policy had been condemned by civil rights groups, who described these movements as functionally indistinct. Further bans were made in mid-April 2019, banning several British far-right organizations and associated individuals from Facebook, and also banning praise or support for them.
In early-April 2019, Facebook announced that it would be pulling its apps from Windows Phone on April 30, 2019, including Facebook, Messenger and Instagram.
NTJ's member Moulavi Zahran Hashim, a radical Islamistimam believed to be the mastermind behind the 2019 Sri Lanka Easter bombings, preached on a pro-ISIL Facebook account, known as "Al-Ghuraba" media.
In May 2019, Facebook founded Libra Networks, reportedly in order to develop their own stablecoincryptocurrency. In recent developments it has been reported that Libra is being supported by financial companies like Visa, Mastercard, PayPal and Uber. The consortium of companies is expected to pool in $10 million each to fund the launch of the cryptocurrency coin named Libra.
On May 2, 2019 at F8, the company announced its new vision with the tagline "the future is private".A redesign of the website and mobile app was introduced, dubbed as "FB5".The event also featured plans for improving groups,a dating platform, end-to-end encryption on its platforms, and allowing users on Messenger to communicate directly with WhatsApp and Instagram users.
On July 3, 2019, Facebook's option to view and load pictures stopped working as people around the world complained. Facebook posted on Twitter about the issue and said they would resolve it as soon as they could.
As of December 31, 2018, Facebook had 35,587 employees.
Board of directors
In April 2019, Facebook nominated Peggy Alford to be added as a board member during the May 2019 AGM. If this happens, she will become the first African-American woman to serve in this board, and the second African-American ever to do so.As of April 2019, Facebook's board consists of the following directors;
Facebook ranked No. 76 in the 2018 Fortune 500 list of the largest United States corporations by revenue.Most comes from advertising. One analysis of 2017 data determined that the company earned US$20.21 per user from advertising.
Significant revenue comes from bulk data access sold to the third parties.
Chart of Facebook's stock
Number of advertisers
In February 2015, Facebook announced that it had reached two million active advertisers with most of the gain coming from small businesses. An active advertiser is an advertiser that has advertised on the Facebook platform in the last 28 days.In March 2016, Facebook announced that it reached three million active advertisers with more than 70% from outside the US.Prices for advertising follow a variable pricing model based on ad auction bids, potential engagement levels ofporations by revenue. Most comes from advertising.One analysis of 2017 data determined that the company earned US$20.21 per user from advertising.
Significant revenue comes from bulk data access sold to the third parties.
Chart of Facebook's stock
Number of advertisers
In February 2015, Facebook announced that it had reached two million active advertisers with most of the gain coming from small businesses. An active advertiser is an advertiser that has advertised on the Facebook platform in the last 28 days. In March 2016, Facebook announced that it reached three million active advertisers with more than 70% from outside the US.Prices for advertising follow a variable pricing model based on ad auction bids, potential engagement levels of the advertisement itself. Similar to other online advertising platforms like google and twitter, targeting of advertisements is one of the chief merits of advertising visa a vis traditional mass advertising modes like television and print. Marketing on facebook is employed through two methods based on the surfing habits, likes and shares, and purchasing data of the audience, namely targeted audiences and "look alike" audiences.
Mergers and acquisitions
Facebook's major acquisitions include Instagram, WhatsApp and Oculus Rift.
Offices
Users outside of the US and Canada contract with Facebook's Irish subsidiary "Facebook Ireland Limited". This allows Facebook to avoid US taxes for all users in Europe, Asia, Australia, Africa and South America. Facebook is making use of the Double Irish arrangement which allows it to pay just about 2–3% corporation tax on all international revenue. In 2010, Facebook opened its fourth office, in Hyderabad and the first in Asia.
Facebook's Hyderabad center houses online advertising and developer support teams and provide support to users and advertisers. In India Facebook is registered as 'Facebook India Online Services Pvt Ltd'. It also has support centers in Dublin, California, Irelandand Austin, Texas.
Facebook opened its London headquarters in 2017 in Fitzrovia in central London. Facebook opened an office in Cambridge, Massachusetts in 2018. The offices were initially home to Facebook's "Connectivity Lab", a group focused on bringing Internet access those who do not have access to the Internet.
As of 2019 the company operated 15 data center locations. Facebook committed to purchase 100 percent renewable energy and reduce our greenhouse gas emissions by 75 percent by 2020. Data center technologies include Fabric Aggregator, a distributed network system that accommodates larger regions and varied traffic patterns.
The StatePoint Liquid Cooling (SPLC) system is an evaporative cooling system that uses water to drive cooling.
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