Despite the industry threat of the loss of cooperation and compensation, brokerage leaders are not all that concerned about the commission lawsuits potential outcomes, according to the RealTrends Q1 2023 BrokerPulse survey.
A mere 3.45% of brokers surveyed felt like the “outcome of commission lawsuits” were a challenge or concern. When asked what they are doing to prepare for a worst-case outcome, some 60% answered, “Nothing.” One real estate broker in the south said, “Nothing as I think we need to see where the case goes before we can adjust to the ruling. But, as an independent, we can pivot pretty easily, and we have lots of flexibility in our current commission policies.”
A Keller Williams broker in Georgia agreed with that sentiment, “We’re not [preparing for commission lawsuit outcomes]. The future will take care of itself!”
Of those who are concerned, popular answers included, ‘implementing buyer representation agreements,” “full disclosure of client options,” and “more training on our value proposition.”
RealTrends BrokerPulse requests surveys from some 19,000+ real estate brokerage leaders around the nation on market trends and brokerage opportunities and challenges. Of the 111 completed surveys, 24% were from the Southeast, 23% from the Southwest, 19% from the Midwest, 23% from the Northeast and 12% from the Northwest. RealTrends BrokerPulse is a forward-looking, quarterly survey.
Housing market outlook
Real estate leaders surveyed for the RealTrends Q1 2023 BrokerPulse were pretty evenly split about the market through the first quarter 2023, with 33% saying they were optimistic, 30% saying they were pessimistic and 37% were neutral.
This despite 66% of those surveyed who felt the market would be down more than 5% in the first three months of 2023. Some 33% said the market would be flat, while a miniscule 4% thought the market would be up more than 5% in the first quarter.
When it comes to home prices, 48% thought home prices would be down more than 5%, 45% said they would be flat and 7% said they would be up more than 5% in the first quarter.
Productivity, motivation and mindset are key
Maybe it’s part of the New Year push to start fresh, but brokers are prioritizing increasing agent productivity and looking for ways to keep agents motivated as we move through this tough market. One Keller Williams CEO in Atlanta said, “[Our focus is to] increase production of our current agent base and get the word out to the public that now is a good time to sell and buy!”
Other challenges rounding out the top five were reducing operational expenses, pressure on net and gross margins and increased regulation/inflation.
When asked about priorities for 2023, cost containment was No. 1, including restructuring office space. To balance that, about 25% said they were focusing on increasing top-line growth. “Our top priority will be working our database much harder [than before] and integrating ancillary services, such as mortgage and title,” said a broker/owner of an independent in Nevada.
Others are looking at ways to increase market share. According to the CEO of an independent firm based in the southwest, “We’re focusing on increasing productivity, recruiting and gaining market share through mergers, acquisitions and walkover opportunities.”
Of course, as in all markets, recruiting and retaining agents are top mentions when asked about priorities.
RealTrends recently added an AgentPulse survey which will help brokerage leaders gauge what agents understand about the services brokerage’s offer and offer agents a temperature of the market.
If you have questions about BrokerPulse, email RealTrends Editorial Director Tracey Velt at firstname.lastname@example.org. Also, be sure to sign up for the new RealTrends Daily, a roundup of news, tips and strategies for success. Each Tuesday, we release a brokerage-focused issue.