Mark McLaughlin shares Pacific Union International’s five-year vision and talks about his outlook for 2015: a healthy economy where interpersonal relationships and referrals are still the primary lead source of the successful agent.

Mark McLaughlin is CEO of San Francisco-based brokerage Pacific Union International.

Are you optimistic about 2015?

Yes, optimistic. We will drive lift (increase) in both units (10 percent) and average sales price (5-7 percent) in 2015. The units will come mainly from 50 percent market share and 50 percent from the market.

The economy?

The San Francisco Bay Area economy is very healthy. Job growth is substantial, and the jobs are very desirable. Four western counties are essentially at full employment (less than 5 percent unemployment). The average technology sector job ($150,000) has an average wage of two times the region average ($75,000), and the job market continues to grow.

The housing market?

As a result of the Bay Area economy, our housing market is very strong. There are four drivers of demand:

1) Job growth — there are more well-paying jobs.
2) Population growth.
3) It’s a very desirable place to live.
4) We have limited, if any, land for development, so the resale market is growing average sales price annually.

Your success?

We are executing a “Vision for 2017” for our business. It’s a five-year plan that we are just completing our second year of execution — we have six bold initiatives in full development and deployment. Our Vision 2017 was developed in December 2012. We drive the business every day to meet the vision and measure our progress on our six bold initiatives each quarter: an iconic brand; a world-class technology platform, both internally and externally facing; white-glove, concierge-like service standards; world-class fiscal results; geographic expansion; and trusted and educated real estate professionals.

What are you worried about?

The governments in Washington, D.C., Sacramento and San Francisco.

How much do you fret about global events?

Personally, I am concerned, but business-wise, since I do not control global events, I do not worry about them. We execute to the Vision 2017 plan.

Will mortgage rates go up or down next year?

Maybe rise up to 100 basis points by year-end 2015.

Will home prices appreciate next year?

[Yes, by about] five to 7 percent throughout the S.F. Bay Area. Higher in some submarkets. Then they will flatten in 2016-2017.

Will agents be more productive next year?

Our agent productivity metric is expected to rise from 9.2 units to 10 units per year in 2015.

Why or why not?

Increasing market share and agent productivity is one of our six 2017 initiatives.

Will the portals play a bigger role in real estate next year?

They will continue to have a louder voice until industry leadership shapes the brokerages’ future vs. reacting to the portals. I do believe the industry is mobilizing to protect its interests.

What will be the biggest source of real estate leads next year?

Interpersonal relationships and referrals. All our business development programs drive to the same end, which is to give our professionals the ability to establish trusted relationships with our clients.

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