"BUSINESS TRENDS" for 2013: How Do You See It???
Below are some examples of the way I see the real estate business trending for both buyers and sellers; This is my point of view from a "Bigger Picture" aspect and I know that markets vary from community to community. I am using the ideas that come from actual facts, i.e. Prudential is no longer a real estate company--they remain a financial firm. (My company has dropped the "Prudential" name and rock logo and is now Douglas Elliman Real Estate as it was since 1911).
I believe these trends may affect the real estate business to such a degree that it will determine whether or not we, as agents, will be in this business next year or not. I welcome your input, as you see it, in your comments here.
It will be the agents responsibility to give buyers and sellers the news about the direction of this industry..We are the ones who really need to see these trends to help our clients make the big decisions about housing. Both buyers and sellers are in a state of deep concern today--fear of the unknown is controlling buying and selling patterns.
I. Many sellers today find themselves in a difficult place with regard to the decision to sell their home. If they must sell, they face a loss on the value of their home and therefore a very strong chance that they will NOT re-enter the housing market.
- OVERPRICING The tendency on the part of some agents to over-price a property without regard to the consequences, is a real problem in today's housing market--Sellers are left to hope they will get the high price at the cost of losing valuable time while it sits on the market. They watch as the value drops month after month and as the possibility of buying another house diminishes.
Sellers, not buying another home, means less business for the agent and the agent's company; it means a great deficit in the housing market. How can we influence this trend? What can we do to help to determine what the "new"buyer is willing to buy, or how willing the seller is to sell?
It benefits all involved to examine any influence or trend that will affect real estate.
The net result has to do with the data that is served up to the seller at the time they list their home---a great analysis of the costs of renting versus home ownership must be a part of the pitch for a listing in order for the seller to see the reality of home ownership today. Proper pricing must be emphasized in order to keep the seller in a state of reality rather than KEEPING THEM A PRISONER of their home.
II. SMALLER, BOUTIQUE FIRMS ARE POPPING UP ALL OVER THE PLACE!
Big Box real estate firms are quickly downsizing--and even getting out of the real estate business entirely! (Prudential is one of those companies--they no longer own the real estate company since Warren Buffit bought it). Agents are moving to new firms--many small older established firms can no longer keep up with the necessary technology and close their doors because of it.
Boutique firms are taking advantage of the rift in the market place--you can see it in marketing techniques that both new and established "Boutique" companies are using--they are using the same approach as "Big Box" firms have used for the last 5 years, and it is proving very successful for them!
- This shifting situation can leave home buyers with the feeling that they are on their own--they may work with an agent who has no idea of how to meet their expectations. The buyer who works with an agent who needs to generate a better bottom line, tells them what they want and is then dragged from pillar to post just to get the showings done that will protect that agent from losing a sale: "get them into all houses in their price range and you can't lose"! When this happens, the buyer is fully aware of what they are doing and it turns them off. They usually go looking elsewhere, usually going to a boutique firm where they enjoy a more "hands on" treatment.
- Since the housing market has suffered it's most devastating set-back in history, the buyers and sellers that traditionally turn the paddle on the "churn" of real estate have shifted their priorities. And that means there are many people today who do NOT want to get themselves into a life long commitment of monthly mortgage payments when they may not have a job tomorrow; many choose now to rent rather than own a home. Sellers may even decide to put off listing their home, leaving inventories sagging and unsold. This means we are left with less desirable listings, usually overpriced homes that make up the bulk of the inventory...Not very appealing to a buyer!!!
- IF they can get a mortgage today, buyers find themselves in a very long and scary search as this market continues to show weakness.
- As a result of the softening of prices again, buyers and sellers are more cautious and careful in the way they choose the agent they work with; they have been hurt once and they don't want to get hurt again! Some struggle on with several different agents--no loyalty to the agents they have used in the past--especially if the home they bought through said agent is now underwater! They would sooner just not buy under these economic conditions---and they walk, especially if they can't find the right agent to help them decide!
- "Big Box" firms, once the shining light in the future of real estate, have become so bottom line focused that many of them have dropped out of real estate altogether, as is the example of the Prudential Real Estate licensing division.
III. THE VERY NATURE OF THE REAL ESTATE PROFESSION IS CHANGING...
And there is an even more obvious and important side effect of what has happened in the housing market in many regions. The weaker prices and stumbling sales results are causing very nervous and unsettled real estate agents.
- In the minds of many a Realtor, these are the times that give them real concern. Many are leaving the business if they can find other gainful employment. No more does the competition look quite so different; no more is there a big divide between the big name companies and the boutiques, as they adjust to this new climate.
- The positive result of this shift from "Big Box" to "Boutique" is that the client now has a better chance of making a careful and considered decision about housing--and that the "new" agent that appears to be surfacing out there is more like the Old Guard. The flashy, quick money attraction is no longer!
Its ALL about the client/customer now and the fast talking, shady image that the real estate business had perpetuated in some of its agents in the past is quietly and appropriately disappearing!
HOW DO YOU SEE IT?
ARE YOU FINDING A SHIFT TO THE SMALLER FIRMS?
IS THERE A CHANGE IN HOW AGENTS TREAT EACH OTHER?
**ALL INFORMATION AND CONTENT IN THIS BLOG IS ORIGINAL TO PAULA I. HATHAWAY. The views expressed herein are my personal views and do not reflect the views of Douglas Elliman Real Estate
Paula I. Hathaway, Senior Broker Associate, Douglas Elliman Real Estate
Southamtpon Village Real Estate Specialist since 1995; Also Specializes in North Sea, Noyac, Water Mill and Bridgehampton, New York
Diamond , Gold and Chairman's Circle Awards; Top Producer since 2005
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