The year 2020 was a quixotic one: Real estate flourished, the stock market boomed, social divisions cracked wide open and people were dying around us from an out-of-control global infection. It changed the trajectory of everything that any of us could have possibly predicted just one year ago.
In this muddled year of unexpected events, experts daring enough to predict the future were often wrong. The doomsayers, sadly, won the day.
Now, we come upon a new year.
Here are twenty one of my ideas about what we might see coming in 2021 in our promising world of real estate.
- Keller Williams will launch a new program to recruit Realtors, doubling down on agent growth. It will stop overplaying its technology hand, coming to grips with the fact that its biggest competitors are not tech firms but fast-growing brokerages like eXp, Compass and Redfin.
- The International Outer Space Treaty of 1967 will be amended so people can acquire land on the Moon and Mars.
- Interest rates will remain depressed, keeping the housing market hot through the remainder of next year. Consequently, publicly traded real estate company valuations will continue to rise, creating more real estate billionaires.
- The Zillowization of real estate branding has devalued big franchise brands. Realogy will roll out “flexible brands” after testing its successful “Powered by ERA.” The new franchise model will emphasize services, tech tools and expansion financing, allowing an affiliate to tout its local company name absent the franchise brand tag.
- By the end of the first quarter of 2021, Compass will go public via a Special Purpose Acquisition Company (SPAC). Its stock will spike, but then settle down. The company will rake in a hoard of fresh capital to grow market share here and expand globally.
- The day old question “where do I live” will enter a new dimension this coming year. The freedom to work anywhere will dissolve state, regional and global boundaries as we knew them, undoing centuries of rigid home to work patterns. Community identities, family connections and transportation networks will be reshaped.
- Florida, Texas and Nevada will be the biggest beneficiaries of the great geographic reshuffling. People are seeking lower-cost areas with no state income taxes and locations where in some cases their like-minded political tribes live. Regional economic power centers like New York and California will lose their clout to a distributed workforce and to low-tax states.
- One of the richest men in residential real estate with an estimated net worth of $1.6 billion, eXp founder Glenn Sanford, will announce a new personal initiative, maybe around virtual medical services.
- Berkshire Hathaway will do what it did this year: make no hyperbolic announcements, create no drama, execute well and make money.
- Zillow will flirt with moving even further upstream in the transaction. The company will put its toe in the home building market, acquiring or partnering with a modular housing manufacturer.
- As public and private debt grows, inflation will raise its ugly head. It will add fever to the housing market as houses offer a cost-of-living hedge. But higher prices for goods and services will put a pinch on consumer budgets and housing affordability will worsen.
- The godfather of Realtor-office innovation 47 years ago, RE/MAX seems primed to do something bold. My guess, it will launch a national virtual brokerage to compete with eXp. It could partner with WeWork for agent community building and offer teams discounted access. The initiative could be a breakout success and hasten the decline of the old brokerage model.
- In a media merger, the Texas-based HousingWire will acquire the New York-based Real Deal.
- HUD will be pushed to increase the penalties for Federal Fair Housing violations. Currently, they stand at $21,400 for the first incident and $53,524 for the next transgression that occurs within five years of the first violation. They are adjusted annually for inflation but deserve an overall reexamination.
- “Coming soon” listings will become a relic of the last decade. Transparency, open markets and full disclosure will win in the end.
- Company acquisitions will rock the industry — everybody is talking to everyone about every deal imaginable. In the big deal category, I could see CoStar acquiring Lending Tree, or Zillow gobbling up Opendoor. More likely are Black Knight, Lone Wolf and Constellation buying up more software companies. For entrepreneurs, you don’t want to be the last founder standing outside when the M&A window closes.
- Nursing homes will die. Post pandemic, the senior housing market will undergo a radical transformation as congregate care goes out of style. Seniors will find alternatives including staying put, as new technologies facilitate safer and better in-home care.
- Insurance premiums will spike because of a proliferation of climate disasters. The National Association of Realtors will get behind a federal effort to protect consumers from price gouging. Homebuyers will become more risk averse about where and what they buy. They will begin to expect their agents to have answers about the local impacts from climate change.
- Real estate industry lawsuits will proliferate and some will be resolved with staggering financial settlements. The litigation will spawn a new age of consumer transparency when the public gets access to all of the local MLS data fields. The DOJ will not retreat from its legal fight with NAR, though the Biden Administration may be more conciliatory because of the powerful trade groups political influence.
- Smart, focused and hard-working Realtors will prosper next year.
- 2021 will be boring compared to 2020. No one will complain.
Thank you for listening, reading and commenting on Inman this year. We feel appreciated and we have mounds of gratitude for your loyalty.