Real estate has long been an industry filled with new business models, lawsuits and emerging technology. It’s also an industry that offers unmatched opportunity. Here’s an outline of some of the threats and opportunities brokerage leaders are facing today. Plus, I’ll discuss some ways to thrive in 2019 and beyond.
Here are a few of the threats we see today:
That summarizes most of the significant threats that we hear about today. Some of these challenges have been faced in the past in different ways and with different players. Now for the opportunities.
In every new iteration of our industry, there are bright spots. Here are a few:
There is nothing the typical brokerage firm, agent or team can do about the litigation mentioned above, nor was there anything they could have done with similar legal actions in the past – except support your Realtor® organi-zations and national real estate firms’ efforts to get them resolved.
There is nothing the typical brokerage firm can do to affect housing supply, affordability, and household form-ations. They are beyond your reach. Brokerage firms can’t likely match the capital of the iBuyer firms, but, in some cases, they can either have their modest programs, point out the weaknesses in their approaches to buying homes, and work with those who want to work with you. Some market economists believe that—at most—these firms may achieve 10 to 15 percent market share in the next five to 10 years.
Understand that the growth of the low-cost brokerage models will reduce the number of agents and teams who will see the traditional, full-service model firms as an attractive alternative. That doesn’t mean every agent thinks that the financial relationship between the agent and the brokerage is the only issue—or even the most critical issue—affecting their choice of firm.
It does not mean the end of traditional brokerage. It implies that brokerage must reconfigure their offerings, not play the game on the low-cost model’s turf.
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