Over his 40+ years in residential real estate, Budge Huskey has built a reputation as a respected and thoughtful leader. As CEO of Premier Sotheby’s International Realty, he has overseen record-setting results, while never losing sight of the need to nurture and inspire talent by putting relationships first.
With the recent partnership between Peerage Realty Partners and Premier SIR, Budge became Vice-Chair of Peerage Realty. His instinctive understanding of Peerage Realty’s values and his alignment with its principles of partnership have quickly made him an invaluable counselor to Peerage Realty’s North American network of leading luxury brokerage firms.
Here, he shares some of the insights he has gleaned over the course of his career.
What attracted you to the real estate business?
My father was a Realtor and developer for over sixty years, so immersion to every facet of real estate was inevitable. I found myself drawn to working with my dad due to the entrepreneurial nature of the business and the people I had come to know and respect.
As my dad rose from very humble beginnings to a real estate icon in Central Florida, what I admired most was the democratization of the business. The economic or social advantage was not an accurate barometer of success. Fire in the belly is a hard thing to profile, yet within ninety days in this business, you know who has it and who doesn’t.
What are the enduring lessons you learned early in your career?
It was apparent early on that success is guaranteed by controlling inventory, so listings were crucial. Even better than individual listings were marketing agreements with builders and developers to control entire communities. Ultimately, the best way to attract buyers is to control what buyers wanted.
It was also easier to differentiate a competitive value proposition for sellers than buyers, and the true value of a brand (whether a company or individual) was based on the uniqueness and consistency of the consumer experience delivered. Most companies failed to create true brand value due to a lack of standards ensuring this consistency.
I also learned about the emotional drivers of real estate and how success was aligned with one’s ability to define goals based on relationships rather than transactions.
Do you think we are in a real estate “bubble”?
Count me among the totally bullish on real estate based on the unquenchable human desire to own a home as well as fundamental demographic drivers.
That said, real estate, like the economy, ebbs and flows. The last two years were disruptive in so many ways due to COVID and aggressive fiscal and monetary policies, and real estate activity and values were overstimulated along with other asset classes. It was a sugar high from which we must now withdraw.
Despite the recent pullback based on higher interest rates and fears of recession, the systemic reduction in listings entering the market ensures values are secure based on supply versus demand. It will prove to be, with rare exception, deceleration rather than depreciation.
History shows that real estate values have, in almost all periods of higher interest rates or inflation, held their own. In many markets, the reduction in unit sales will be offset by increasing prices. In discretionary markets, my read is that price increases will cover only about half of the decrease in units. Regardless, there is no credible justification for declarations of a bubble and a repeat of the experiences in the early 2000s.
What indicators or trends you are watching these days?
The very best indicator, for me personally, is the intuition and observations of our advisors who are closest to the customer so individual conversations are often the first glimpse as to what’s next.
I try to focus on leading measures such as new listings, pending sales trends, days on market, open house traffic and price reductions among other data. Due to the unprecedented shifts in business over the last two years, we began comparing current business levels to 2019 to seek some sense of normalcy. Many people speak to the change in the market occurring in the second quarter of this year, while I have been consistently stating the market began shifting in the third quarter of 2021.
What are the key industry trends from both a buyer and seller’s perspective?
Perspective is required. Real estate is emotional and subject to an overreaction in either direction. Despite the macro concerns, the economy and household balance sheets remain strong. So many signals of an impending recession are present, yet the job market remains resilient and consumer spending robust.
Those entering a real estate event need to understand we are in a different place from a year ago and reshape their expectations, without viewing our present situation as transformative. Ultimately, we are an industry facing significant shortages of new and resale inventory in the face of an insatiable appetite for home ownership.
What is your take on those who say the “traditional” way of selling real estate is dead?
While no one would question the desire to streamline the real estate transaction and mortgage process for consumers, the only segment declaring the need for radical change in the real estate process are pundits and those who aim to profit from disruption.
Customer satisfaction with real estate professionals, the percentage electing to engage a Realtor, and the desire for advocacy by a human remain consistent year after year. What’s exciting is not those who prophesy the demise of our industry, but rather those who are figuring out a way to operate more efficiently, to work as partners in empowering buyers and sellers with more options within a resilient framework.
How do you support advisors who may not have been through a challenging period in the past?
Transparency and honesty are the first steps in guiding people to accept that a change in strategy and tactics is necessary. It’s not just for new advisors but also for those who’ve forgotten the fundamentals of the business as they have been so busy in recent years just responding to demand. People must learn to hunt again in a market that is no longer expanding.