Editor’s note: Signs of a slowing real estate market raise questions about who in the industry will be most vulnerable to a housing recession. Fewer real estate transactions means there is less money to spread around, and that will impact everyone. But some will be hit harder than others – especially if they are not prepared. In this special series, we examine who’s most at risk.
Editor’s note: Signs of a slowing real estate market raise questions about who in the industry will be most vulnerable to a housing recession. Fewer real estate transactions means there is less money to spread around, and that will impact everyone. But some will be hit harder than others – especially if they are not prepared. In this special series, we examine who’s most at risk. (See Part 1: Condo craze days may be numbered and Part 3: ‘Exotic’ home loans put lenders at risk.)
As air begins to escape from the real estate bubble, new real estate agents may be in for a rough ride. Newbie agents across the country said they intend to dig in their heels and fight – principally through networking.
“The bubble won’t burst, but things may slow down,” said Leo Lalla, a Seattle Realtor who was licensed five months ago. “The way to handle that? Networking is key.”
A total of 125,290 people became Realtors in 2004, bringing the total number of Realtors in the U.S. to 1.1 million, according to the National Association of Realtors. As the market softens, Realtors become vulnerable, especially new ones without established contacts.
But new agents across the country said they have no intention of quitting and will market themselves aggressively in the face of the downturn.
“I’m not leaving the business. I’m in it for the long haul,” said Robert Stanley, a Hayward, Calif., Realtor who got his license just five months ago.
“Basically I will advertise a bit more, do more socializing,” said Stanley. “We go to a lot of Chamber of Commerce mixers, and we do booths at local festivals. I’ll do more face-to-face contact, more door-knocking, trying to talk to people,” Stanley said.
“I’m not scared,” Stanley said. “I think for new agents it’s just being diligent. There are a whole lot of agents that jumped in because the market was hot. Only so many of them are going to make it.”
Stanley, who works with Realty World Neighbors, said, “You have to take new technology and old-fashioned real estate skills and put them together.” He started in March and already has three sales to his credit.
The average price of a house is down about $10,000 in Marin County, Calif., where Judith Hodgens launched her real estate career just six weeks ago. But Hodgens is hanging tough.
“We’re seeing a little bit of a downturn, but so far, people are still selling. It’s not anything that has me terribly worried,” said Hodgens, who is the former mayor of San Anselmo, Calif. “I just made a significant investment in the business and I’m not leaving.”
Hodgens is taking full advantage of her extensive network of contacts in the area. “I’m getting in touch with people I haven’t seen in a while,” Hodgens said. “I’ve just about completed a special mailing a friend of mine is designing for me that will be a card hand-addressed to 100 of my inner-circle friends from all my years in town.”
The card will introduce Hodgens in her new role, she said. “I haven’t quite constructed the language, but it will be to the effect that I’ve taken on a new career and I’d love to work with those who know me as a member of the Town Council, mayor and neighbor if they are buying or selling a home.”
Hodgens is also showing houses for her associates at open houses. “So if someone walks in the door without a relationship with an agent, that person is a potential client for me,” Hodgens said.
It appears that Hodgens’ concentrated networking has paid off. She just received an offer on a house she was showing for a colleague, Hodgens said – her first potential sale after only a month and a half as a licensed Realtor.
“The market’s slower than it has been, but we’re on pace to be in the top three best years ever here in Ft. Collins as far as houses sold,” said Josh Forster, who has been a Realtor at Coldwell Banker in Ft. Collins, Colo., since January. So far, Forster has helped six people buy homes and currently has four listings.
“It’s definitely not the market I’ve heard about having here before, but I’m not concerned about being able to survive in the market,” Forster said. He said Linda Norton, one of his mentors in the office, has told him that the most important priority is to “go for the listings. The listings are where business comes from.”
Forster uses the 1-800-CALL-CAPTURE system. He purchased an 800 number that goes on the yard signs for his properties and gives callers information on the houses while capturing the caller’s number as a lead. “I call them back and make sure they have all the information they needed and hopefully form a relationship from there,” Forster said.
Tom Balchin of Gena Gilbert Real Estate in Morehead City, N.C., became a Realtor in January. He has sold one home and several lots and has helped “eight to 10” people buy homes, he said.
Balchin said he has seen no signs of a slowdown and expects the hot market in his area to continue for five to seven years. For agents in slowing areas, Balchin said, aggressiveness and initiative are the answer. “Without those qualities, even in this market, I’m not going to be successful,” Balchin said.
By “aggressiveness,” Balchin said, he means “the cold calling, going out and getting listings from clients.”
Seattle Realtor Leo Lalla, who specializes in condominiums, has sold five condos and has three listings with one sale pending after five months in the business. The grandson of a Sicilian immigrant who died at age 96, Lalla takes his grandfather’s teachings to heart.
“I was taught that the customer is the most important person, as important as your brothers and sisters,” said Lalla, who has 12 siblings. “Visit these people and treat them as friends, not just when they are going to do something for you, but all the time.”
When he was getting started, Lalla walked up and down First Avenue in the Belltown neighborhood of Seattle visiting the concierges at the front desks of all the condos in the area. “I stopped in and hung out with them and got to know them and my phone started ringing,” Lalla said.
More than anything, Lalla said, it’s important to enjoy the job. That way, the Realtor said, you’ll get referrals – and have a good time to boot. “Everyone I’ve worked with so far has said, ‘You’ve made this fun.'”
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