Inman events are the best way to connect, learn and grow. Join us this week, Oct. 26-28, for Inman Connect Las Vegas, in-person or virtually. Then, continue to gain insights, strategies, and tactics to keep your business growing and make 2022 your best year ever with a full line-up of 2022 events! Save the dates, and register now!
As inventory worsens and home prices soar to never-before-seen highs, many signs are pointing toward a stalling of the market. While it can be hard to even imagine a downturn, growth does not continue unabated indefinitely and a lack of affordability often stalls the market for everybody — thinking about this type of situation now will keep you ahead of the curve for the coming months and years.
“Things are still pretty busy and house prices are still going up but the truth of the matter is that things can’t stay this way forever,” Texas-based RE/MAX agent Jemila Winsey said during an Inman Connect session title “Critical Ways to Prepare for a Market Cool-Down.” “We need to be intentional and proactive in how we do business when we go back to normal.”
Here are four ways you can prepare for the unexpected at a time when many are still focusing on rising home prices.
Connect with your database
At the very start of the pandemic, many agents were afraid of a downturn and became extremely proactive in keeping connections alive — calling and checking in on any possible client without expecting any immediate sale. While the following year turned out to be one of the best on the books for many in real estate, the idea of building connections without expectations is still a very good one as it builds a strong network you can fall back on during leaner times.
“Many of us have been going 100 miles an hour and haven’t really taken the time to connect to our database and past clients,” Winsey said. “Now is really the time to start making those connections. Pick up the phone and give them a call.”
Know your market inside and out
During a downturn, it becomes especially important to know your market to a tee. This means knowing not just listing prices but everything from gains to neighborhood changes and days on the market.
Tracking this type of data regularly will allow you to spot even the most gradual of slowdowns and, in doing so, you will be able to predict what’s happening before it hits. Quite often, this starts with the MLS; track it regularly and consider putting this information together in a spreadsheet over the course of time.
“I set an appointment with myself every Monday morning,” Homeward agent Julie Youngblood told the audience. “I would spend 20 minutes looking at the MLS and looking for: How many homes are on the market? How many went under contract? What was the average days of those that did go under contract? What did the closings look like? I just had a spreadsheet where I just added this information, week after week after week.”
Partner up with commercial agents
Winsey gave the audience a tip that at first might seem unusual but is actually extremely useful: Commercial agents often have more information on market trends than residential agents. Finding and regularly networking with a colleague who works in commercial real estate will allow you to spot larger trends about the city that sometimes get lost when selling individual homes.
“[Commercial agents] have access to data that we never have on the MLS,” Winsey said. “What commercial buildings are coming in? What are the traffic statistics on who’s moving out? There’s so much information within the systems that they use that can make you stand out in the crowd and give you additional leverage. But if you’re just starting out, the MLS has way more information than you need to start educating the clients.”
Educate your clients
But naturally, none of the market insight you’ll gain is useful if you do not take it back to the field and share what you know about sales trends with clients. This often comes down to simply warning clients that house prices may not grow by as much as homeowners think if they wait another year but, Winsey said, can also be turned into deeper market insights — what will the neighborhood look like in five years? is another boon in the works? — that you share on social media as posts or videos if you’re feeling ambitious.
“Those conversations often happen during the listing appointment but you can also turn those into video educational moments that you can put on social media and get out to people so they start to see you as a subject matter expert,” Winsey said.