Now that the worst has passed, what should brokers focus on for success?
When the pandemic first hit the housing market, and few knew just how bad it might become, we stressed that brokerage firms, teams, and agents should focus on only two things.
- Get closer to your people
- Preserve cash
We shared this with many firms and agents in more than 100 webinars over the past ten weeks. During those webinars, we reminded real estate professionals that the desire of consumers of all ages to own homes is unabated. Housing consumers use agents at the highest levels in 20 years, and consumers value their agents’ help with negotiation, navigation, and the establishment of a trusted relationship.
We based this on input from real-world data (see Against All Odds) and our experience researching leading brokerage firms through every recession of the last 40 years. These two focuses are vital for every brokerage firm, team, or agent. These two critical areas of focus are essential to the health and future success.
Now that the immediate danger of a collapse in housing sales has passed, what else should brokerage industry leaders think about and plan? There are a few that we would recommend.
- The segmentation of the market for securing the services of agents and teams is fragmenting further and
will continue to put pressure on incumbents. We’ve written about this before, but given data we’re seeing from The Thousand and America’s Best Real Estate Professionals (more than 14,000 ranked in 2020), the trends are moving faster.
- The battle for supremacy through the use of technology will intensify among national real estate organizations, brokerage firms, teams, and agents. The backdrop to this trend is that there isn’t proof that any single technology platform will deliver a sustainable, competitive advantage to any single realty organization. It does not mean it won’t happen, only that there’s no proof that any single platform will produce a clear winner. One only needs to look at the first-quarter results from five of the largest national realty organizations, it will likely be a challenging second quarter for them. Despite the investment of millions into tech platforms, none is showing that they’re pulling away from the field in any meaningful metric.
- The general workforce will move away from centralized workspace requirements. How much of this short-term trend will become embedded in the economy is anyone’s guess, but there will be a shift of some magnitude. Should the brokerage industry move in the same direction? Should incumbents move away from retail office environments and more towards work-at-home for their agents and staff? Should they shrink their office space? There are numerous opinions on how far this may go. There’s a good counter-argument that culture is hard to build without some recurring interaction between agents, staff, and leadership of a realty company. However, we can point to the growth of organizations such as eXp and Side, Inc. to suggest that having offices for agents remains a highly valued and attractive asset.