Editor’s note: Inman News has embarked on the "Roadmap to Recovery," an editorial project that seeks to engage our readers in a discussion about the future direction of the industry. Click here for more information.
There isn’t a thing I can do about the economy or about the current housing market. In some parts of town it is grim, and I am not insulated from the suffering of my friends, neighbors and clients.
There will be a recovery one day, but I don’t know when that day will be, and I need to continue to make a living. There is no doubt that we will see big changes in the real estate industry. It has been changing at a rapid pace during the last few years. The business model I am working under did not exist three years ago, and I have been inventing it as I go.
To me, a recovery will look like a more balanced market between buyers and sellers and a slight appreciation in home values each year. A market where entry-level buyers are not priced out of the market and credit is available to those who are creditworthy. Recovery won’t look like the peak during the housing boom years.
There is someone missing from the conversation as we discuss the viability of existing business models, the impact of recent government actions on the housing market, and the use of technology in running our business and marketing our services, among other topics.
Consumers are missing from the conversation, but they are having conversations just the same. All too often we steer the real estate industry discussion toward ourselves. We have a big role to play, but buyers and sellers have a much bigger role, and the economy is the stage we all play on.
The truth is: Consumers don’t care how our industry fares or how much money we make. They are more concerned with how much money they have to spend, and just want to buy or sell houses. As agents we need to listen to our clients and learn what we can do to best serve them.
Right now buyers are afraid to buy. There is buying going on, but it is as if buyers have lost site of what homeownership is all about. They are worried that buying a home is a mistake, and they are worried about job loss.
Sellers have more tools at their disposal than ever before and can sell their own home without a Realtor or with limited assistance from a Realtor. Some sellers have little or no equity in their home, making for-sale-by-owner a more attractive option than ever before.
As a Realtor, I need to look for the best ways to serve these buyers and sellers, and I need to figure out how to make a profit in the process. It has not been easy this year. Short sales and foreclosures take a lot more time and work and result in a lower commission than traditional home sales do. With more than 35 percent of the local listings in some stage of foreclosure, they are unavoidable.
Not all of my listings sold last year, and on average listings stay on the market a lot longer than they used to and are more expensive and time-consuming to service.
At the same time, business expenses and brokerage fees have gone up. Brokerages need to make a profit, but there is only so much they can take from agents. They need to listen to their customers — the agents — and learn how to serve them and make a profit.
Our conversations about the Road to Recovery can’t be just about Realtors and brokerages and technology — they have to be about consumers, too.
Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.
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