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Gary Gold, executive vice president at Hilton & Hyland in Beverly Hills, has sold thousands of properties over the decades and has worked on some of the most exclusive listings in one of the country’s priciest enclaves. At this very moment, he even has one listing worth nearly $200 million.
But even if you don’t have an eye on the 90210 market, there’s a decent chance you’ve heard of Gold for one big reason: He sold the Playboy mansion. That sale closed a year ago and, according to Gold, set a record for the first residence in Los Angeles to go for more than $100 million.
Gold is speaking next month at Luxury Connect in Beverly Hills, and recently chatted with Inman about the points he’ll hit during his speech, how the luxury real estate business may fair in a recession and how agents can work at the very highest end of their markets. What follows is a version of that conversation that has been lightly edited for length and clarity.
Inman: The idea you’re going to be touching on is how to persuade your clients to go in the direction they need to go in. So, how do you do that?
Gary Gold: Earlier in my career, I had a difficult time doing that. I somehow connected persuasion with trying to trick somebody. But as I got older, I started to really understand the business. What happens when someone hires you to buy or sell a home is they’re basically hiring you to manage them. Basically they’re saying, “make sure I do what I intend to do.”
I look at it more as coaching someone to do a flip, or jump off a ski hill or catch a wave. They said they wanted to do it, but now they’re all nervous. That’s what people really hire us to do.
One thing I like to do from the get-go is really, really educate my buyers so they know what the inventory is. It’s a really enjoyable process when your clients are well-educated. The more they know, the more they’ll trust you.
Talk to me about sellers. How do you move them along in that process and coach them?
I’ll come with all the relevant comps. In luxury real estate, you’ve got to really customize it and look at what are the relevant comps. So similar lot size, similar neighborhood, not just similar city, similar views. You might have a house that has no view and everything else that sold has a view.
One very powerful thing to do if you’ve got a seller who is not realistic is to show a property and not the price and say, “how much do you think this house sold for?”
There are a lot of disruptive technologies out there right now. Do you think luxury buyers and sellers are likely to start fleeing to techie real estate tools in the future?
I’m very aware of what’s going on and I never underestimate the possibility of technology changing things. But real estate transactions are still really complex at the moment and a luxury transaction has a lot of components to it. I think that technology will definitely play a huge role in how we can better serve our clients. But I don’t think technology is going to replace us.
Luxury and high-end — the really high-end that I deal with — is so nuanced that I can’t imagine someone doing it themselves or wanting to do it themselves.
There’s also some discussion about a possible recession in the next year or two. You’ve been in this industry for a number of years and have seen ups and downs. Tell me what happens to real estate in a recession.
In the last five recessions we’ve had, two of them had a negative impact on real estate. In three of them, properties continued to go up slightly.
In a recession, the real estate market does not necessarily change for the worse. I will tell you that if we do have a recession and it does have a negative impact on our business, more than anything it changes our business. First of all, if you have a downturn you have a lot of people getting out of the business.
Also, all these companies that are all hot and are growing but not really making money, like iBuying, are not going to be so sexy to investors when we’re not in a hot market. Or big real estate companies that are growing and bleeding money. It’s a hot market now and they’re bleeding money so what do you think will happen when it’s not a hot market?
As soon as the market changes, you’re going to see a lot of those people literally perish.
Finally, how do you get into the luxury market?
You need to be really strategic about it. The first thing is you have to identify where would it be that you’d sell it. And you need to analyze the market. What’s the total amount of commissions or sales that there are in this market. Who is making these sales, and is there some opportunity there that you can take advantage of?
If I could make more money and have more fun selling different types of property, I would. Luxury just happens to work for me and everything came together. It was very strategic.