Setting the New Norm
“Never let a crisis go to waste.”Various renditions of the quote have been attributed to many throughout the years including Winston Churchill and Rahm Emanuel. For real estate brokers, it means not just getting through the current crisis, but taking steps to come out stronger on the other side.
79.7% of real estate brokers surveyed as part of the recent U.S. Broker Survey of more than 2,000 brokers answered “yes” to the question, “do you see opportunities ahead for your company within the market.” Many brokers I’ve spoken with report an increase in buyer activity and they’re not alone.ShowingTime, which measures a rolling weekly average in 100 top U.S. markets, says showings were up 27% toward the end of May. Current low interest rates have also helped spur buyer activity.
Personally, I’m already weary of the phrase –“the new norm”– it creates the impression that we wait for events ahead to unfold. In reality, there is an opportunity now for brokers to be proactive and it revolves around the agents. Here were three things to focus on if you want to do more than just accept “the new norm”:
1. Focus on listings– Last month I reported that pending listings (anticipated listings coming in-house over the next 90-days) are estimated to be down nationwide by an average of 45%. Imagine what 3rd and 4th quarter will look like if your listing base drops that low after the current inventory sell-off. NAR says 51% of members reported sellers delayed their home sale for a couple of months and at the moment, 77% of homeowners are making preparations to sell. Lawrence Yun, Chief Economist at NAR, recently said,“After a pause, home sellers are gearing up to list their properties with the reopening of the economy.”
There is a window of opportunity as listings will be the determining factor in how the rest of 2020 turns out for you and your agents. When you have the listing, every broker in the MLS works for you. But it’s also the hardest part of the business for most brokers and agents; working with buyers is easier. The house sells the buyer, but it’s the listing agent who must sell the homeowner to get the listing.
This is the time to laser focus your company and agents on activities that lead to listings. When I started back in the ’80’s, my broker always said the three Golden Rules of Real Estate were: listings, listings & listings.
2. Focus on your agents– In the same survey, it was shown that while the anxiety level of brokers is still elevated, it has dropped considerably from the beginning of the Covid-19 crisis. However, brokers estimated most of their agents still have a high degree of anxiety. In March, it was reported that88%of agents had an anxiety level that ranged from anxious to more than a high degree of concern/anxiety. In the follow up survey ten weeks later, that number had only dropped to 53%.
Clearly the agents are still concerned which is understandable since for this is new ground for
most agents. Only 16% of the brokers reported 50% of their agents were in the business during the crash of a decade ago. Renown real estate coach, Mike Ferry, points out that 80% of today’s agents have never done a deal where the average interest rate remained over 5%. Since most brokerages today have newer agents, here’s what they need from you:
- Training & coaching- Especially focus on seller prospecting and getting listings which does require more work and greater agent skills
- Over communicate with them – Agents shouldn’t be allowed to operate in a vacuum; reach out to them multiple times a week
- Provide direction & accountability – Most agents focus on non-revenue activities. They need to be directed on those activities that will produce listings as well as understanding why being held accountable to stay on task is so important
- Seller lead generation – Providing leads at a more favorable split to the company provides direction for the agents while increasing company dollar. Be sure to follow up with the agents and hold them accountable for all leads
- Your time – One of the best things you can do with your agents is to schedule time to speak with them and help them focus on developing their plan for the year
3. Focus on Recruiting– It’s been said that recruiting cures almost everything that ails in a brokerage. Not just recruiting, but GOOD recruiting. It creates great opportunity in your brokerage and the new blood boosts enthusiasm and culture. Good recruiting is like a domino, it increases your recruiting success and it is one of your best retention tools as well.
A large coastal brokerage reported picking up more than 35 agents because they reached out to agents in their area and found many who felt abandoned by the current brokerage. All they did was focus on finding those agents who had issues that the broker could fix.
2020 NAR Flash Survey: Economic Pulse
Gain perspective on the real estate market and the economy with the most recent edition of the NAR Flash Survey: Economic Pulse.
Anthony Fauci warns of ‘irreparable damage’ if lockdowns are kept in place for too long
“In general, I think most of the country is doing it in a prudent way,” he said on CNBC. “There are obviously some situations where people might be jumping over that. I just say please proceed with caution if you’re going to do that.” Read more with Dr. Fauci.