With a supply-heavy housing market, a glut of distressed properties and the continued rapid evolution of social-mobile technology, 2012 poses some distinct challenges for those in the real estate world. A few brokers give their take on the new year and how they’re adapting to it.
For 2012, "getting listings is not the issue, it’s finding buyers," said Re/Max CEO Margaret Kelly. And the buyers who are around, she said, are changing what they’re doing with the properties they purchase.
Sixty to 65 percent of homebuyers are turning homes they buy into rentals, she said. "Instead of buying and flipping, they’re fixing and renting." That influences agent training, she added.
Also, Kelly is watchful of trends in overseas investors purchasing U.S. real estate. She’s guiding her management team at Re/Max, which launched a new global real estate website in November, on how to deal with international investors in the housing market.
It’s important, she said, not to focus on kitchens, for example, when dealing with an international buyer looking at a property as an investment, but to understand and know how to talk about maximizing cash flow.
Glenn Sanford, CEO of eXp Realty, a national, "cloud-based" real estate brokerage, said his focus for 2012 remains on the virtual, cost-saving elements of his company. "Leaving a brick-and-mortar office is not only about avoiding the outlay costs of a receptionist and solid-state infrastructure," he said, "it’s about the freedom and the streamlined reality of the new virtual world."
Sanford said he expects that world to deepen. "Facebook is becoming the new online office," said Sanford. In 2012, "an increasing amount of communication will take place inside private Facebook groups by members of any … brokerage," he said. "The watercooler talk is taking place on Facebook."
However, "The No. 1 trend on our radar," said Sanford, "is 3-D technology," citing YouTube’s 3-D capabilities and 3-D TVs. In the next 12 to 18 months, he expects the rise of a 3-D multiple listing service and the capability to view house listings online in three dimensions.
Sherry Chris, CEO of franchisor Better Homes and Gardens Real Estate, is focused on the divergent demography of potential U.S. homebuyers, epitomized by the baby boomers and their children, the "echo boomers," each now representing a third of the U.S. population. "We must ensure that there are cross-generational agents who can service both groups," she said.
Chris earlier this year announced a master franchise agreement to take the brand across Canada, a first step toward broader global operations.
In the slow market, said Chris, Better Homes and Gardens Real Estate plans to streamline operations by downsizing office space. On average, brokers now have 100 square feet per agent, she said. In the new year, she added, ideally, that size would drop to 50 square feet.
The company is also directing resources, said Chris, to coaching agents on effective use of social media and on how to ensure their value in real estate transactions, which are increasingly becoming consumer-controlled. "Servicing a client is not as transaction-oriented as it was previously," she said. It’s about preparing, she said, for a longer relationship.
In the leaner markets, some brokers are experimenting with a new kind of office space. Unlike eXp Realty, and its virtual response to a tight market, Eric Post, a partner with Better Homes and Gardens Real Estate in Oregon, just opened an Apple Store-like, 1,200-square-foot office in Happy Valley, a suburb of Portland.
It’s like a café," he said. "There’s no reception desk (and no receptionist), no manager’s office." It’s a completely flexible office that can serve multiple uses and morph according to need, he said. All furniture is movable.
The communal-oriented office has been open for about 60 days, serves 22 agents, and focuses on the idea that you "get more as a group than as an individual," said Post.
"Agents need to learn a new pattern — (they) need to know how to use an iPad, not to rely on a receptionist, to serve a wider geographical area." The model’s been so successful, he said, he has similar offices in the works for three other locations, with designs and subcontractors already in place.
Post is also focused on getting his agents more plugged in to the communities they serve, getting them to eschew generalist tendencies by specializing in something, such as a location or a service. Accordingly, most of his brokerage’s 2012 marketing dollars, said Post, will go into developing "microsites," or hyperfocused websites.
"And," said Post, "agents have to be aware of how to merge their social and private lives," because "with mobile and social technology, those worlds are no longer separate."