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Being A Realtor in 2020

Here’s what it will take to be a successful realtor from now on – hat tip WSJ!

“It’s an attention game. It’s not who has the better postcards, it’s about who can attract the most eyeballs,” Mr. Serhant said. “I can walk into an appointment with a seller and say ‘there are 30,000 active real-estate agents in the city, there’s hundreds and thousands of us all over the world, but I have a level of exposure you can’t buy.’ ”

Mr. Serhant has decided that it’s time to cash in on his name recognition. After more than a decade at the brokerage Nest Seekers International, he is starting his own company, which will be known as “Serhant.” The new firm will have its own film studio, digital-marketing lab and a tech team dedicated to tracking the reach of the brand and its content across the web. Mr. Serhant said he decided to launch his company now because he believes “the traditional real-estate brokerage model is broken.”

“The brokerage company, open houses, and pretty photos don’t sell homes today the way they did 10 and 20 years ago,” he said. “Buyers of high-end real estate, and their children, go to YouTube and social media on their phones to research homes and agents now. I was already doing things differently from everyone else and it has been working incredibly well so I thought why not do it differently and build a firm from the ground up?”

Eddie Shapiro, Nest Seekers International founder and chief executive, noted that Mr. Serhant is not cutting ties with the company entirely. He will close out the business he signed at Nest Seekers, including his listings and new developments. Mr. Shapiro said that the company’s agents are now involved with a new reality real-estate show on Netflix called “Million Dollar Beach House.”

Mr. Serhant’s new business will crank out social-media content and multiple, dedicated short-form series for its YouTube channel, “Listed by Serhant,” based around his agents and listings. One series, provisionally called “3 in a Million,” will invite regular people into three listings and ask them to guess the price. Another, called “Meals in Mansions,” will be hosted by an agent at the firm who enjoys cooking and who will make meals in the kitchens of the firm’s high-end home listings.

Mr. Serhant, whose YouTube channel has one million subscribers, already produces his own YouTube videos weekly, putting together a mix of listing reveals, personal day-in-the-life style vlogs that showcase his family and personal life and business advice tutorials with titles like “How to OVERCOME self-doubt” and “How to SUCCEED in a VOLATILE market.” While these videos don’t directly sell his listings, Mr. Serhant said, they help him build a global following, which, in turn, gives his listings better exposure.

These tactics aren’t for everyone and some competitors snipe that Mr. Serhant is more interested in being famous himself than dedicating his time to his clients. Others said these stunts are more likely to attract voyeurs than actually result in deals, since ultrahigh-net-worth buyers aren’t likely to be shopping for multimillion-dollar properties on Instagram.

But Mr. Serhant argues that the numbers prove out his concept: His team at Nest Seekers did $1.4 billion in closed and in-contract sales last year, mostly in New York and in the Hamptons, making him one of the most successful agents in the country. He estimates that since he started in the business, he and his team have sold over $4 billion in property. Last year, they sold a $40 million house in Bridgehampton to a prominent executive who reached out to Mr. Serhant after finding him on YouTube, he said.

“If a listing video gets 10,000 views or a million views, that’s a big difference,” he said. “I tell clients, ‘I work incredibly hard to grow my brand for your benefit so I can put your listing in front of more eyeballs than anyone else in the business.’ ”

Mr. Serhant said many of his wealthy clients have secret accounts on Instagram that aren’t registered in their real names. One former client, so privacy-obsessed that his chauffeur-driven car had blacked-out windows, had an Instagram account and mentioned several of the properties he’d seen on Mr. Serhant’s account.

“Instagram isn’t a joke now,” Mr. Serhant said. “People will go to your Instagram to see who you are as a person before they pick up the phone. You don’t need a business card, you need a powerful social-media profile.”

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Getting Started in Real Estate

I’m going to help a few people get started in the business, and hopefully make a career of selling real estate.  I figure I should just publish my guide right here on the blog, and Fridays are a good day to do it!

Let’s explore what it takes to become a realtor in 2020!

Where to get your license: First Tuesday

It’s so easy to get a real estate licensee, demonstrate your commitment to yourself and get one.

Online training courses give you the basics and prepare you for your state test, which is 150 multiple-choice questions – get 70% of the answers correct and you pass! You can’t sell real estate without one, so if you’re in it, to win it, get a license so you can get paid right away!

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There are two sides of the business; sales and transaction coordinating.

If you are a great people-person, then being in sales is for you.  It’s called a ‘salesperson’s license’, but so far all you’ve done is pass a test.  Getting out and speaking with people regularly about buying and selling homes is the job.

If you’re not a people-person, or want to work your way into the sales business, you can take a more clerical job in transaction coordinating. Once the salespeople have brought a buyer and seller together and completed a written purchase agreement, then we have staff assist with making sure all the necessary details get done to close the sale.  This job pays around $30,000 – $50,000 per year if you don’t mind working a few 12-hour shifts along the way. There is a limited future unless you can create your own company.

Oh, you want to be in sales? What’s the difference?

You don’t get paid anything along the way. You’re paid on commission. You need to sell, to get paid.

It’s not that comfortable for the first twenty years, but you’ll get used to it.

What’s realistic?

You probably won”t make much money during your first year, so have sufficient financial backing that you don’t have to sweat it.

Expect to spend money on your business.  You are an entrepreneur – a business owner – and it takes money to make money. But if you are a socialite who can generate leads from the yacht club then more power to you. We will help you pursue leads. Compass is touting our new AI engineering, and it promises to help.

You need someone to teach you the ropes. You need a mentor.

The big brokerages offer a mentor program with classroom training and a manager.  It’s the basics, and better than nothing.  But ideally you want on-the-job training where you are learning while doing.

In summary: Get a license, have some money in the bank, and find the best mentor you can.

More next week!

Industry-Disruption Podcast

Here’s a thorough discussion on the the state of realtor disruption – early on, Rob refers to this post:

https://notorious-rob.com/2020/07/two-steps-forward-one-step-back-the-story-of-innovation-in-real-estate/

For every tech platform that sets out to disrupt real estate, there’s a story of slow evolution to working with brokers and agents. And while companies like Zillow, Opendoor, and Offerpad have brought about minor changes to the home buying process, they always end up morphing into our traditional system. Why is it that these so-called disruptors just can’t change the way we do real estate?

In this episode of Industry Relations, Rob and Greg are exploring why would-be disruptors have such a hard time changing real estate. Greg walks us through his five-stages-of-grief analogy around how tech platforms always end up working with brokers and agents, and Rob compares real estate with the auto industry, reflecting on how little buying processes have changed despite advancements in technology.

Rob and Greg go on to introduce the idea that the human connection is what prevents tech disruptors from succeeding in our industry, speculating that agent teams have been the biggest disruptor in real estate in recent years. Listen in for insight on how human knowledge and connection factor into making tech platforms successful and learn why the human need for approval is not disruptable.

What’s Discussed:

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Wait And See About Foreclosures?

This presentation covers both sides of the concerns about home values plunging because of the effects of the pandemic on the economy.

Suze says don’t buy a house until later this year because there could be foreclosures, and David points out that the CARES Act already gives those in forbearance at least 6-12 months. I’ll point out that the rules changed after the last crisis, and now lenders don’t have to foreclose if they don’t feel like it – which makes foreclosure an option, not a requirement. It’s a huge change that Suze doesn’t see.

Our society is now geared to take advantage of other people’s misfortune, so insiders will pounce.

San Diego Coming Soon on MLS

Our MLS is going to provide a Coming Soon feature, which will fluster the agents who say that the Coming Soons build anticipation (like a movie trailer) and test pricing, but who then use the concept to circumvent the MLS and instead advertise directly to the consumer in hopes of double-ending the commission.

Members,

The Coming Soon status launches in San Diego Paragon Tuesday, May 19th. From that day forward, when entering listings for sale in San Diego Paragon, you may choose between Active and Coming Soon.

To prepare for this launch, Paragon will undergo scheduled maintenance from 10:00 PM PT Monday, May 18th to 6:00 AM PT on Tuesday, May 19th – a total of eight hours. Paragon will be unavailable during this time.  Below is a brief video to help you understand the details of this status.

How does Coming Soon work?

Coming Soon allows listing agents to take up to 21 days to stage the property, take interior photos, prepare it for showings, and so on, without Days on Market accruing.

How is Coming Soon similar to Active?

– Marketing is allowed in both statuses, so long as Coming Soon listings are clearly marked as Coming Soon.

– Both Coming Soon and Active listings are fully displayed to other professional users of MLS systems.

– The listing agent offers a commission on both Coming Soon and Active listings.

How is Coming Soon unique?

– Coming Soon listings have limited distribution: they will not go out from the MLS to portals like Zillow, Trulia, and Realtor.com, or to IDX broker and agent websites.

– Showings are not permitted in Coming Soon.

– Because of these limitations, Days on Market do not count in Coming Soon.

Realtors’ Big Game

Hat tip to Rob Dawg for sending in this podcast by a realtor president – an excerpt:

It’s been a strange, and difficult time for us. So, imagine what it’s like if you are trying to buy, or sell a home. Tim Comstock is President of the Ventura County Coastal Association of Realtors, as well as a working Real Estate Agent. He says that if buyers or sellers can wait, they should.

Comstock says about 20% of the homes listed when the crisis started have been taken off the market, but some people still have to move ahead because of factors like a job move or a death in the family.

Comstock says despite the difficulties, some deals are still happening. He admits it isn’t easy.

As for the future, what does the industry expect? Comstock says people will always need housing, but much will depend on whether people keep their jobs, so that they’re in a position to buy in the first place.

Within twenty seconds into this podcast interview, Tim said that buyers and sellers should wait if they don’t have to move, and that he had nine listings currently that he is struggling to sell. This is the guy who is the public face of Ventura County real estate, and the elected leader of the local realtor group.

The listeners are looking to him for guidance, and leadership.

He did them a great disservice.

While we know that being the president of a realtor association is mostly ceremonial, when a crisis develops on your watch, it’s your time to deliver for your people. Agents are counting on you to help them!

This is our Super Bowl, and the ultimate challenge of our career.  This is where realtors get to rise up and demonstrate our value as problem solvers – and then provide solutions!

He threw an interception here – time to get back in the game and throw for a touchdown.

He should get back up to the microphone and apologize – maybe he had some bad pizza the night before?  Then tell us how realtors can serve their clients, and assist them with moving while we’re in this predicament.  It’s what leaders are expected to do.

We may not win every game, but let’s try.

Weekly Realtor Survey

This isn’t what buyers and sellers think.  It’s what realtors are thinking that their buyers and sellers are thinking, but we aren’t mind readers so it’s really what realtors think…..who haven’t left their house for a month.

Yes, the markets are showing delays. Sixty percent said their clients are pressing pause for a couple of months. Completely stalled, though? No—they’re simply simmering, responses show. Consumers and the industry are adapting to the changes, awaiting a hopeful return to normalcy.

“Expect second quarter home sales activity to slow down with the broad observance of stay-at-home orders, but sales will pick up when the economy reopens as many potential homebuyers and sellers indicate they’re still in the market or will be in a couple of months,” says NAR Chief Economist Lawrence Yun. “Home prices remain stable as deals continue to happen with the growing use of new technology tools. Remarkably, 10 percent of REALTORS® report the same level or even more business activity now than before the economic lockdown.”

How else are the markets faring? The survey shows 33 percent (a third of REALTORS®) have not experienced closing delays. For those who have reported delays, these road bumps often happen during the financing, appraisal and home inspection portions of the transaction process.

The key to adapting? Technology. To cultivate new client relationships, surveyed respondents say they will leverage live videos (33 percent), social media (59 percent), e-closing tech (42 percent), e-signatures (77 percent), virtual tours (34 percent), messaging apps (38 percent) and WebEx/Zoom (30 percent).

Link to Survey

Many realtors will end up out of the business – look how many are unplugged:

 

Last Week’s Realtor Survey

Buyer interest declined by 90%? I think they meant that 90% of buyers don’t want to risk their life to see a home in person – they are still interested in the market as seen from the couch.

NAR’s latest Economic Pulse Flash Survey – conducted April 5-6, 2020 – asked members questions about how the coronavirus outbreak has impacted the residential and commercial real estate markets. Several highlights of the member survey include:

  • Due to the outbreak, 90% of members said buyer interest declined and 80% of members cited a decline in the number of homes on the market.
  • Home prices look to hold steady after rising robustly before the pandemic. Almost three in four members – 72% – said sellers have not reduced prices to attract buyers. Conversely, more than six in 10 members – 63% – said buyers are expecting a decline in home prices as buyers sense less competition in the current environment.
  • Technology plays a vital role as the real estate industry adapts to the new reality of managing deals virtually with social distancing directives in place. Members said the most common technology tools used to interact with clients are e-signatures, social media, messaging apps and virtual tours.
  • Residential tenants are facing rent payment issues, but many delayed payment requests are being accommodated. Nearly half of property managers – 46% – reported being able to accommodate tenants who cannot pay rent and more than a quarter of individual landlords – 27% – said the same. The recently enacted Coronavirus Aid, Relief, and Economic Security Act includes provisions on eviction prevention and small business loans and grants that are critical to keeping the rental market steady.

View NAR’s Economic Pulse Flash Survey full report here:

https://www.nar.realtor/research-and-statistics/research-reports/nar-flash-survey-economic-pulse

Showings Way Down This Month

The seven-day moving average was +32% on March 8th, and now the average is -68.7%!  This is during the peak showing season too!

But at least the current trend looks like it is flattening out?  Hopefully the change of realtors being declared essential workers will mean more activity, but it might be too late already.

This will probably be the death knell for buyer-agents, especially if the ‘rona tightens the supply further, which would cause fewer listings to make it onto the MLS.

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