An optimistic view of home sales, more education surrounding diversity and inclusion practices and a peek into how real estate may be impacted based on election results.
In this quarter’s REAL Trends Broker Sentiment Survey, we added some questions to gauge the pulse of brokerage firms on diversity and inclusion, COVID-19 and the election. Here’s a breakdown of how brokers felt about those topics:
Some 43% of the brokers who responded to the question said there would be no change or a temporary slowdown no matter which candidate was elected. Some comments included, “There will be little impact as demographics and the economy will drive housing. The economy is most impacted by the virus,” according to a Pennsylvania-based broker. A broker in North Carolina says, “After a short, volatile period, I think things will settle down and continue to track individual market trends.”
However, some 33% said that the market will be positive if Trump is elected, the House turns Republican and/or the Senate stays with a Republican majority. Said a Michigan-based broker, “If the Liberals win, I believe we will see a downturn in the economy and real estate.” A New York-based broker agrees, “If the Democrats win, the market will go into shock. Second home purchases and luxury home sales will stop for a while to see what Biden does to taxes. If Trump wins, we will continue to grow and remain strong.”
Only 1% of respondents said specifically that a Biden presidency will be good for real estate. Some 7% are unsure, 7% say it depends on the candidate (not specifying which candidate would be positive or negative), and 9% felt there would be a major impact (not specifying positive or negative) regardless of which candidate was elected.
Election Outcome Impact on Housing Market
43% No Change or Temporary Slowdown
33% Positive Market if Republicans Elected
9% Major Impact No Matter Which Candidate/Party Elected
7% Depends on Candidate
1% Positive Market if Democrats Elected
Diversity and Inclusion
Some 68% of brokers surveyed said their company is putting a greater emphasis on diversity and inclusion. Most are offering agent and manager education and building inclusion and diversity into the culture of the brokerage with specific practices.
78% Diversity Training for Brokers and Managers
35% Building Inclusion and Diversity Into Culture
27% Diversity and Inclusion Recruiting Program
20% Not Doing Anything
6% Rewriting Mission Statement
4% Participating in Protests or Community Activism
Please note, brokers could choose multiple action items, so this adds up to more than 100%.
Markets and Economy
In our 3rd Quarter Broker Sentiment Survey, nearly 87% said sales will be up 5% (62%) or Flat (25%). In the 4th Quarter survey, brokers are feeling more positive with 91% saying that sales will be up 5% (59%) or Flat (32%) in the next three months. Some 53% say that home prices will be up 1 to 5% in the next three months, with 33% who think that prices will be up more than 5%.
- Keeping staff motivated and focused: 60% say it’s highly important
- Difficulty recruiting: 59% says it’s highly important
- Pressure on net margins 57% says it’s highly important
They are not as concerned about:
- Reducing personnel: 70% say it’s not as important as other areas
- Building or implementing a new tech platform or business model: 29% say it’s not as important as other areas
- Building a more diverse and inclusive brokerage: 27% say it’s not as important as other areas.
The immediate impact on real estate—regardless of the outcome of the election—is likely to be either a temporary pause, or no impact at all. However, REAL Trends does think that, depending the party in power, a slowdown is possible due to a potential increase in regulations and taxes by the Democrat party. Both parties have positive and negative aspects to their proposed housing policies. We outlined all of that in a series of articles in our newsletter. You can view them here: How a Biden Presidency Could Impact Housing, and Comparing Republican and Democratic Platforms on Real Estate Industry Impacts.
For now, brokers must focus on the fundamentals: reducing spending, building strong relationships with agents and staff, and offering services to boost agent productivity.