This is my 748th blog post of the year! (641 published and 107 drafts)
Let’s note how drastic things have changed since rates went up:
NSDCC Detached-Home Sales, December
2012: 297
2013: 223
2014: 255
2015: 259
2016: 241
2017: 225
2018: 196
2019: 229
2020: 290
2021: 183
2022: 95
The best forecasting tool is the number of sales.
Look at how crazy-high the number of sales were in 2012 and 2020. In both cases, the demand had been building up and it really cut loose late in the fourth quarter – in spite of the holidays – to close a third more sales than normal (the average count of the other nine years is 212 sales). Then the two biggest frenzies in history broke out in the following spring.
The number of December sales can help us predict what is coming – and it doesn’t look good for 2023!
We will get our 100 sales once everyone reports their closings, but it’s HALF of the average count.
This year was terrible for many, if not most, agents, and about the best we can say is that we survived. It’s going to get worse in 2023 because there aren’t enough sales to go around. The conditions next year will force many agents into early retirement – why keep paying your dues if there’s not much hope?
You can’t ignore the current predicament and keep doing the same things you’ve done the last 5-10 years. You gotta do better. The industry has to do better.
Here are my 2023 requests of agents:
- Publish relevant data that’s easy for consumers to digest. Come up with something juicy that makes a difference, instead of the usual agent blather we see on social media. Printing the number of sales is good, but also add your opinion on what it means – the audience wants hear your interpretation of the data and they will spend a minute or two to get it.
- Make it easy to show your listings. If you employ the same hurdles from the frenzy days – like insisting that I send my buyers’ financials just to schedule a showing – then you should pay us more commission to compensate for the hassle.
- Will you provide buyers and agents with a walk-through video of your listings please? Let’s preview the homes in advance by video, which will save your time if it isn’t a fit. Adding helpful tips or witty remarks are great, but they are not required. Put the video link in the listing remarks – which is still allowed by the MLS. I don’t see many Matterport 3D tours or any video tours, do you? Let’s upgrade!
We will be having HALF the normal number of sales in the early months of 2023. If we’re not doing it better, then these conditions will persist, and could go on for years.
Every day, we are getting closer to the end. Let’s give it everything we got!
Very good advice 100% on point.
It’s never fun breaking bad news. You cant fight the market however you can adjust + make the most of what’s available.
The bears are coming learn how to appeal to them.
Thanks Shadash!
I sure don’t want to hear any agents saying, “who knows what’s going to happen?”
There will be some spectacular sales which will feel warm and fuzzy. But for the most part, it’s going to be a slugfest – and it’s obvious to anyone who is willing to interpret the data.
I would add.
Don’t squeeze your rental management clients to compensate for fewer sales. Both short and long term bridge burning.
“On the consumer side, we, as an industry, still have a lot of work to do,” said Pierre Sabbagh, CEO of Roof AI Inc. “The digital customer experience is still as clunky as it’s ever been. When Netflix knows what you want to watch, and Spotify knows which music you’ll love … real estate consumers still have to fill out forms and wait on someone to reply. They’re still expected to save a property search and favorite a listing in 2023.”
Sabbagh added that it’s even tougher for agents trying to deliver an easy buying or selling experience.
“On the agent side, we’re simply expecting too much from them. They’re suffering from choice fatigue in tech with too many options to choose from,” Sabbagh said in an email, adding that the training is also subpar. “These software gadgets turn out to be fundamentally flawed and end up requiring manual work… No wonder why agent adoption is suffering.”
https://www.realestatenews.com/2022/12/30/tech-in-2023-shifting-from-nice-to-have-to-have-to-have
His most relevant hot take right now isn’t even that hot: Jonathan Miller opposes the idea that the US housing market will crash now the way it did during the Great Recession. Like many of his peers, he argues that there are too few properties on the market compared to those seeking homes for that to happen, and that the market varies too much locally.
His candor over the last 36 years has helped him rise to a vaunted position in a crowded field of experts, including Redfin’s Daryl Fairweather and the National Association of Realtors’ Lawrence Yun, who are both economists.
Those in the field respect him, from his best friend, the Chicago realtor Garry Vallo, to Phil Crawford of the “Voice of Appraisal” podcast. Friends say celebrities like NBC’s beloved weatherman Al Roker and the “Shark Tank” millionaire mogul Barbara Corcoran call on him for his appraisal expertise.
“I’m proud that I’m not an economist,” Miller, who feels that not being tied to a larger corporation helps him remain objective, said. “When things are bad, I say they’re bad. And when things are good, I say they’re good. The good means more because I said when things were bad.”
Today, there’s much more data than there was when he started Miller Samuel, but also a lot more “crap,” Miller said. An analyst now, he said, must be a curator who sorts through data without catering to a cause.
There’s a reason Miller always picks up the phone — even in the middle of the Long Island Sound — and it goes back to getting the truth out.
“It’s in my best interest to have the world have a proper take on the market,” he said. “That’s the long-term goal.”
https://www.businessinsider.com/jonathan-miller-bio-appraiser-real-estate-data-expert-2022-12
Regarding item #2 –
JtR, remember during the Summer of 2020 when that one listing agent practically insisted I provide her with years of financials before she would allow us to view the property. But, in the end, you sold us our house just a few doors down for about the same price??
Ah, good times.