Jay Thompson is a former brokerage owner who spent six years working for Zillow Group. He retired in August 2018 but can’t seem to leave the real estate industry behind. His weekly Inman column publishes every Wednesday.
A decade ago, some kid was starting his freshman year of high school, not old enough to drive a car. Today, he holds a master’s degree and is running meetings at a multimillion dollar, publicly traded company.
Ten years is also two-and-a-half presidential terms. A lot can change in a decade.
It’s December, and the ’20s are here folks. If you’re like me, that makes you feel a little older. Good grief, I’ll be entering my seventh decade, and I’m not even 60.
As we’re heading into 2020, let’s take a moment to mentally drift back over the past decade and open up to the possibilities of the next 10 years.
My, how we’ve grown
For the real estate industry, the past decade saw a recovery from the subprime crisis. There were increases in home values almost across the board.
The market shifted from being filled with foreclosures, bank-owned and distressed properties, and short sales to inventory-starved markets with bidding wars and double-digit appreciation. All along with record low interest rates.
The 2010s brought many changes to the real estate space, mostly in technology. The evolution and growth of the internet provided significant impact.
In our ever-evolving real estate industry, there weren’t even agent reviews 10 years ago. Zillow and News Corp. were still five years out from acquiring Trulia and realtor.com.
Compass? It didn’t exist in 2010. By 2019, it’s gotten $1.5 billion in funding and is valued at $6.4 billion.
That pesky upstart Redfin went from the bane of many to changes in its model, to an IPO. Is Compass next on the IPO train?
Speaking of funding, in 2010, almost no one in real estate even knew what venture capital was. Today, we’ve got $1.9 billion of capital being distributed in one quarter. The entry of VCs into the space is a significant change for our industry.
EXp Realty? Ten years ago, zero agents. Today, 23,000 agents.
Those oft-maligned portals were a fraction of the size they are now with significantly less consumer impact. Zillow was getting 10 million visitors a month 10 years ago, that’s grown to 700 million today.
Of course we now have iBuyers, who went from non-existence to player in just a few years.
The birth and expansion of the on-demand economy might go down as one of the most significant shifts in how business everywhere is fundamentally conducted.
The seemingly overwhelming desire of the consumer to have immediate access to goods and services is undoubtedly affecting how consumers view the real estate transaction, which subsequently affects how they industry serves them.
Where was the on-demand economy 10 years ago?
In May 2010, Uber went live for the first time in San Francisco. Today, it’s found world-wide and is publicly traded with a market valuation of $49 billion; billion, with a B.
In 2010, Airbnb was two years into an experiment that started with three guys renting an air mattress to broke college kids. Today, it plans to go public next year and is valued at $31 million by private investors.
This kind of rapid growth and fundamental shift in consumer thinking should cause one to pause and ponder. Change will happen. Fundamentally, you have two choices: Reject change or fight it.
Refuse to accept it — and do what? I don’t know, I guess keep doing the same-old, same-old. Just plod along, doing what you’ve been doing and watch those embracing change blow by you.
So reject and fight change, which leads to frustration and failure, or embrace it, and leverage it for growth and success. It seems like an easy choice, yet there’s an unhealthy level of resistance to change in this business. Real estate agents can be a stubborn lot.
Welcome to 2020
Ten years is a long time, and lots can happen. Ten years also seems to fly by. There can be significant changes and shifts in the U.S. and world economies. Economic cycles can wax and wane, the political power can flip 180 degrees in the span of a decade. More than once.
Real estate is cyclical. That there were both buyer markets and seller markets occurring across the decade should not be a surprise. The fact that we’ve been in a seller’s market as long as we have is a bit of a surprise. But fear not, it will shift to a buyer’s market at some point. Because, real estate is cyclical.
This was the decade where iBuying was born. Will we still be talking about it in years? Or will ever-changing consumer needs and demands create another substantive shift in how this business is conducted?
Who knows. The only thing we know for certain is that time marches on and change is inevitable, and there is nothing that can be done to stop or even slow down either. And I don’t think we’d want to. A stagnant, never-evolving business means nothing for the future but a slow spinning death spiral into obsolescence.
Real estate evolved massively over the past decade. It seems reasonably safe to assume there will be significant changes in the coming decade as well.
Change is good. Time is the only thing you can’t buy more of. As we roll into the next decade, look ahead, think like and for the consumer, watch for trends, and don’t get stuck in the past. Hang on, the next decade might be a wilder ride than the last one.
Jay Thompson is a real estate veteran and retiree in Seattle, as well as the one spinning the wheels at Now Pondering. Follow him on Facebook, Instagram and Twitter. He holds an active Arizona broker’s license with eXp Realty. “Retired but not dead,” Jay speaks around the world on many things real estate.
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