Chris Scott, president at The Paperless Agent, said that increasing customer expectations and finding (and keeping) the agents who can meet those expectations are challenges for his business in the coming year.
Chris Scott is president at The Paperless Agent in Austin, Texas.
Are you optimistic about the economy in 2015?
The economy looks to continue growing on a national level and, for us, at the local level. The Mortgage Bankers Association forecasts overall U.S. economic growth of 2.9 percent in 2015, continued monthly job gains and declining unemployment.
The housing market?
With economic growth, sales of new and existing homes will also increase. While most indicators point to an increase in mortgage rates around mid-2015, we don’t think it will be enough of an increase to negatively affect sales levels.
What are you worried about?
We’re poised for great success in 2015, but that doesn’t mean we don’t have our concerns. A major issue we wrestle with in our real estate brokerage is being able to find and keep enough of the right agents. Competition for finding and keeping these agents is an ongoing challenge, and we have to constantly adjust the services, tools and education we offer to stay ahead of the curve.
Will mortgage rates go up or down next year?
Here’s a breakdown of what the MBA and Fannie Mae say about mortgage rates in 2015:
|30 YR Fixed (%)||Q1||Q2||Q3||Q4|
Will home prices appreciate next year?
Home prices should also increase. At a national level, here’s what MBA and Fannie Mae say:
|Median Existing ($ Thousands)||Q1||Q2||Q3||Q4|
We expect Austin to follow a similar pattern of steady price gains. In terms of economic recovery in general, our state has outpaced the national average, and Austin is especially strong. Just last month, Austin single-family home prices set a record for the month of September. At the same time, home sales rebounded from the last two months of home sales declines, increasing 10 percent from September 2013 to 2,524 home sales. All of this is great news for our business and makes us optimistic about 2015.
Will agents be more productive next year?
The real estate industry is undergoing significant technological change and is being affected by shifts in marketing trends and consumer behavior. Thus, despite a strengthening economy and housing market, we think agents are going to face greater challenges than ever before in being productive. Gone are the days when you could just focus on simple activities to generate business. Consumers are more sophisticated and informed than ever before, and the typical agent has to know not just how to get a deal done, but also how to use more technology and understand the more complex world of digital advertising and social marketing.
Why? Or why not?
With all of this new technology and marketing, you would think that more agents would be able to competitively do business, but, in fact, many brokerages don’t have the necessary resources, leaving most agents to fend for themselves. This is why we continue to see a small minority getting the majority share of business. Agents, or their brokers, need a firm understanding of how to use technology and marketing to serve their customer and grow market share.
Will the portals play a bigger role in real estate next year?
A consumer could have a great search and research experience online, only to contact an agent through the portal who isn’t focused on delivering a high-quality experience to the customer, which means the customer is left feeling disappointed. This is bad for everyone: agents, brokers, portals and consumers. This is why, as an “indie,” or independent, brokerage, we put such a strong emphasis on trying to connect the experience that often starts online and ends with a personal relationship between agent and customer.
What will be the biggest source of real estate leads next year?
Our best source of leads falls into two broad categories: agent-generated and company-generated business. The best lead sources for individual agents have been, and will continue to be in 2015, working their networks and generating repeat and referral business. The best source for our company-generated business is our website.
Are you making plans to expand, contract or maintain your business this year?
In 2015, we expect to increase investment in both categories of business. For agents, it’s to invest in their education so they can continue to serve the evolving and informed housing consumer. For our company-generated business, we are investing in a complete rebuild from the ground up of our website. This includes the integrated technologies the website will use to generate business.
We also plan to expand our investment in integrating traditional marketing approaches, such as farming, with digital advertising such as Google and Facebook ads. Our investment for expansion in 2015 is significant, and we expect it to help grow our business considerably.
What is the biggest challenge for the industry in the coming year?
On the industry level, one of the biggest challenges is being able to meet increasing customer expectations that are being set through their online search experience. With many consumers, the real estate portals are where they get their initial information. The consumer is then directed to the agents or brokerages who spend money with the portals, but this doesn’t necessarily translate into a consistent experience by the brokerage or agent who follows up.
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