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REAL Trending  Special Edition: Leading Through A Challenging Market

Apr 10, 2020 7:56:29 AM

Lennox Scott, Chairman and CEO of John L. Scott Real Estate in Washington, California, Idaho, and Oregon

With offices in four states, each with different government mandates, Scott talks about how he navigates today's COVID-19 situation. In addition to a weekly video update, he's employing technology to keep agents informed. Find out what other business decisions he's made to minimize losses.

Tracey Velt:

In this special edition of the REAL Trending Podcast, we're speaking to real estate leaders on what they're doing to minimize the impact of the coronavirus on their businesses. We'll talk about actions they're taking, lessons learned from 2008, and more. This is Tracey Velt, editor in chief of content for REAL Trends. Today we're speaking to Lennox Scott, chairman and CEO of John L. Scott Real Estate in Washington State. Welcome Lennox.

Lennox Scott:

Well, thank you Tracey.

Tracey Velt:

So tell me a little bit about how you're feeling right now. Set the numbers aside for a moment and tell me what you're feeling and what you're hearing in the real estate industry around you.

Lennox Scott:

Well, right now we're busy. We're focused in on communication, on care, on just walking in solutions. And then looking out ahead for the change back in the market in a few of the areas where we're in the stay at home situation for a couple weeks.

Tracey Velt:

Okay. So obviously I watched you had some videos that you sent to your agents and to your managers. It talked a little bit about some of the steps you're taking, but tell me what steps have you taken immediately to lessen the impact on the company? Not necessarily open house restrictions and that, but just to lessen the impact on your company overall.

Lennox Scott:

Well, Tracey, first of all, I'd like to take a look at... We have a five step approach to success, that we take things through. And the first one is what is the situation or the challenge or sometimes it's an opportunity, but this case it's the challenge, the coronavirus. The second step is, what do we want our outcome to be? And so we always project out ahead, here's where we're going, this is what we're going to do.

Step three is creating that positive affirmation or a declaration of who I am in the outcome. Step four is what activities am I going to take? And step five is, sense and track what were our activities to keep the conversation alive. And that's exactly what we're doing right now. We're in several different markets in a four state area, Washington, Oregon, Idaho, and now in California. And each area is at a different phase of this coronavirus situation.

Lennox Scott:

So for example, in Oregon they're in a stay at home situation. But we are still able to do showings with social distancing protocol. One client at a time. Make sure we ask the health questions, the wellness questions, sanitary protocols in regards to that. Over in Idaho where the coronavirus isn't a major situation. There are still a few open houses going on right now, but we know that's going to evolve very quickly over to no open houses, I believe.

And then we'll go right into our social distancing protocols for both sellers, buyers and for our broker associates for that. So there's different things we're doing in different markets. In the Washington market, last night was when we've got the message stay at home. And so that is meaning we believe no showings at all. So we're in a hard lockdown for about two weeks. But during that time we're going to be doing activities so that when that two weeks is up and we go back to social distancing protocols instead of lockdown, we are ready to go. We're, in moving forward.

Tracey Velt:

Okay. And so how does technology play a part in that? Are you doing any training, special training on using virtual tours or activities to do while you are on lockdown such as go clean up your database, things like that. Are there specific things that you're encouraging agents to do? And talk about what you're encouraging the brokers to do as well.

Lennox Scott:

Well, for our agents, the number one item, of course is relationship database. That's where 80% of our business comes from. So we're focused in on communication with our database. We have some agents that need to amp up their database and get it into a format. We send out a housing update each month. So they need to move forward on that. We're really talking, because we're demonstrating all of our office meetings are virtual and so our broker associates are seeing that.

Our agents are seeing that. So we're helping them get up to speed on their own video conferencing so to speak concept of communication. Because it's five times the communication, than a phone call, or ten times over a email. Is that [inaudible 00:05:22] the base is number one, their communication but doing it no matter what, but if they can up their game to the video communication.

Tracey Velt:

Well I noticed that you seem to take a very proactive approach to communication. Sending out videos and updating listing protocols and that. So talk about the communication side of it from a company perspective, what are you doing and how frequently are you communicating? And tell me a little bit about that.

Lennox Scott:

Well this last week was a very busy week because of all the changes going on with coronavirus. It seems like each day it's going up the ladder of conditions of operational conditions out in the marketplace. So we put out the video, of course, to our broker associates. We put out a consumer video that they can send to their relationship database. We put out a video to our agents of here's the three, four activities to do during this time.

So, and now we have an office leadership meeting every week, virtual meeting and we may end up doing it twice a week, because the changes are happening so much. We will be putting out to our support team, we put out all the activities going on about working from home. To be proactive, to reach out to our individual agents. The same with our office leaders one at a time, and see how we can support them during this time, whether it be a total stay at home order or where we're still able to work from home and do showings, social distancing showings at that time.

Tracey Velt:

Okay. And I know you've been through the 2008 downturn, so as a company, are you taking any actions or did you do any things after that time that are really helping you lead through this chaotic time? For instance, I realized that while you're still selling homes, it's probably not as high as it was even a month ago. And so from a profitability standpoint, were there things that you did that are helping you now?

Lennox Scott:

Well, in our marketplace all throughout our footprint, the market was just as good as a year previous up until yesterday. And so now we're just now seeing that, the changes because of this stay at home, stay safe policy in one of our states. We're still fully operational with showing social distancing protocols in the other states of Oregon and Idaho. And so we've always run ourselves very efficiently.

When the 2008 market hit the great recession, we did close half of our space at that time because we knew it was going to be a long time and we never brought that space back. It was kind of a... It pushed us forward to do what we knew we needed to do and we were able to double the of the company in that same half space back then. This time the push is for all agents relationship database and pushing us forward to video communications.

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Lennox Scott:

So it's the big push that's taking place that will make our industry better forever. All the processes, all the technology, all the years we've invested in are coming forward at this time. With all the internet, working with all the closing service providers online, that's all in place. So the real big push right now is that video communication and database.

Tracey Velt:

Okay. And what do you feel as far as, do you feel that there's going to be a change in the way real estate is done, maybe closings or a push toward, more of this infrastructure in place with technology because of all of this. Do you feel there's going to be a change or do you feel like it's going to go back to business as usual and that?

Lennox Scott:

well I believe in the push button transaction process. And where it used to be 35 days, then it went down to maybe 25 days. We're down to a ten day transaction process right now. They'll close whenever it's right for them, whether it be a 20, 30, 40 days, but the process is done. And I want to see it move down to the five day transaction process. Because that creates certainty for the seller, for the buyer, for the agent. Everybody can move forward in what they're doing.

The agent can go do more business because they're not tracking the process. And so we're already in, been moving towards that. All of our service providers are moving towards that. And this, once again, will just vault that forward everywhere, is this a quick transaction process. Everything's online nowadays, but what remains the core value of our service is that personal representation. That counseling when working with sellers, helping them get their home ready.

Lennox Scott:

Expert marketing, transactional excellence, negotiations, networking with the other brokers. That all remains the same. It hasn't changed in the 25 years of the internet world and it's not changing forward. It's just that everything else is speeding up, and there's going to be that, even more of a need for that consultant, that trusted real estate advisor.

Tracey Velt:

Okay. Yeah, and I totally agree with you. That will not change. Any final advice that you have for brokers, who are going through this crisis and looking for ways to really help their agents?

Lennox Scott:

Well in those market areas where you're not at a complete stop for showings, where we are using social distancing protocols, we're recommending that for sellers, that they limit down the number of days that the house is actually available for somebody to show the house. So maybe bring it into the MLS on a Wednesday, so that the buyer can look at the professional photos. Maybe there's a tour, they can drive by the house.

They already know the area, 80% of buyers do, so they're just waiting for that next property to come on the market. So that creates social distancing for the seller by limiting the numbers of days each week that the house is available for a showing. For the buyers where it's one buyer at a time, there's no public open houses. So you bring in one buyer at a time on that maybe Saturday or Sunday so that after the showings that day, they can do a good clean down of the house.

Lennox Scott:

Of course the seller turns on all the lights and opens up the closets. Also to make sure that we get adequate exposure, that open house used to do, is maybe the seller reserves the right to review offers after the showings over the weekend. So that we can get full exposure for the house to be able to bring an offer forward. The best offer or multiple offer forward because we're still at a severe shortage of inventory. We're up to where 80% of the sales take place in the more affordable and mid price ranges.

Tracey Velt:

Okay. Well great. Well thank you so much for speaking with REAL Trends. We really appreciate your input, and we wish you the best through all of this so that you come out on the other end doing great.

Lennox Scott:

All right. Thank you, Tracey.

Tracey Velt:

Thanks, Lennox. Have a great day.

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