This January marks Inman’s fifth annual Agent Appreciation Month, which culminates at Inman Connect New York in a celebration of agents at the end of January. Plus, we’re rolling out the coveted Inman Power Player Awards, as well as the New York Power Brokers and MLS Innovators awards.
Congratulations on surviving 2023 and welcome to 2024. It’s safe to say that the real estate industry had a lot of turmoil and uncharted waters for many companies and agents.
Looking forward to this year and the years to come, I have tried to narrow down what I think the biggest challenges are that will continue to shape the direction of the industry. I have boiled these concepts into three simple “I’s” — indecision, inventory and interest rates.
Indecision
If there is one universal truth I have learned from my time in real estate and mergers, it’s that “Time kills all deals.” That holds true for buyers and sellers as well. The longer people have to think about their options, the less likely they will be to finally make the jump and complete a transaction.
Getting buyers and sellers off the fence can make or break an agent’s pipeline. So, what can be done to help hedge against this obstacle?
Focus on life changes. Think of the life events that force people to make real estate moves: death, divorce, disability, diamonds, diapers, etc. These folks are far more likely to transact quickly and decisively. Turn your marketing efforts toward making yourself the resource when the time comes.
Use the takeaway sale — as my CEO likes to say, “The fear of loss is often stronger than the opportunity for gain.” Learn to paint a picture of what life looks like if they fail to move forward with their plans. This can help move them off the starting line to begin the process.
Inventory
This should come as no surprise to anyone in the real estate industry, but we have an inventory problem in this country. Sellers are holding on to their properties, homes are being scooped up and placed into short-term vacation management, and fewer homes are being lost to foreclosure.
Those are just a few reasons that buyers have limited choices. If I could crack the code, I could make a good living telling others how.
Change your tactics to help break through the indecision dam that is holding back inventory.
Hammer your sphere of influence: These are the people most likely to work with you or connect you with others who may need your service. Find consistent and unique ways to stay connected.
Widen your expertise. Think of new verticals where you can get business. Areas like property management, investment properties, commercial, etc., can be a goldmine of new business that can bolster your revenue through a changing market.
Interest rates
I know you’re tired of hearing about the rates and when they will decrease. However, if you have been following along so far, you will see the pattern emerging.
Interest rates are probably one of the key factors blocking inventory and keep willing and able clients from moving forward.
The good news is that help is on the way. We are already seeing streamlined refinance programs offering certain homeowners the opportunity to capitalize on the “date the rate” concept they’ve heard for 18 months.
Knowing that rates are likely to drop this year, don’t let your clients wait to time the market. Get them moving now and help them refinance later. If they can afford the house today, they can really afford it when the rates drop.
Educate sellers
Waiting for a rate drop might benefit the seller with a higher price, but how much higher will it really be? Will that difference be worth waiting for every on-the-fence buyer to now be competing? Show the math and see if it makes more sense to sell now when there is less competition for them to purchase again.
Partner with a smart lender
Having a savvy loan officer on your team will help arm you to maximize your value in the coming months. Our mortgage partner has a buy-before-you-sell program that allows sellers to move forward in a way that alleviates the current mortgage on their DTI ratio, so they can write a non-contingent offer on their next home. Something as simple as that can make all the difference.
I wish I had a crystal ball or a magic wand. Unfortunately, none of us can predict what will happen. All we can do is work with the market we have.
Recognizing these key factors can help guide how you educate and market yourself to be a greater resource to your clients. No matter what happens, be the calming voice of reason in these tumultuous times. Your clients rely on your expertise and wisdom to help them make the right choices. That reputation will help you overcome these and other market obstacles.
Stephen Meadows is a 20+ year industry veteran and is the chief operating officer with Coldwell Banker Premier. Connect with him on Facebook and Instagram.
