personal connections
Issue 85 - May 20th, 2022
Consumers tend to choose real estate agents based on a referral from a friend or family member or use a friend who is an agent who they trust. Generally, consumers couldn’t care less about the brokerage flag the agent works under as the agent brand continues to become dominant in our industry.
The role of the brokerage, in my opinion, is to provide an incredible place for agents to thrive, so the brokerage attracts great agents who in turn attract and work with their incredible network of customers. The brokerage should focus on providing impeccable service, giving the agents a place where they can thrive financially, and providing add-on services and support to make the agent’s life as easy as possible.
The brokerages who continue to win will be the ones who let the agents focus on their strengths such as selling and marketing and let the brokerage take care of the rest.
Some will argue that certain price points require certain brokerages to represent certain properties, and I would say this matters less and less. 10 years ago, the brokerage brand meant much more in the market, but in today’s world the value of the actual brokerage brand has become second-fiddle to the agent’s name and reputation.
I think this also has to do with the fact that the role of the agent has evolved much more from “property finder” to “transaction process consultant” which I have written about previously in other posts, so it is not just one factor influencing the shift in the market in terms of branding importance.
Some info to support this point from the National Association of REALTORs:
68% of sellers who used a real estate agent found their agents through a referral by friends or family, and 53% used the agent they previously worked with to buy or sell a home.
Sellers who definitely would use same agent again: 90%
Agents can build an incredible business on their networks alone as every single person in the world needs a place to live - it is one of the most unique industries on the planet in that regard where everyone you know is a potential customer.
Newsworthy Links To Share
Housing starts in April fell by 0.2% M/M to an annualized 1.724 million units, short of the 1.756 million consensus. Single-family starts fell 7.3% M/M (but still up 3.7% Y/Y) while multifamily rose by 15.3% (up 40.5% Y/Y!). EvercoreISI’s Ed Hyman notes that “with mortgage rates up significantly, total housing starts are likely peaking but will remain elevated given low inventories. And the surge in multi-unit housing starts will eventually put downward pressure on rents, but that will take a while.”
Building permits fell 3.2% M/M to an annualized 1.819 million units, ahead of the 1.814 million consensus. Single family permits were down 4.6% M/M (down 3.6% Y/Y) and multifamily fell by 1.0% (up 15.7% Y/Y). John Ryding and Conrad DeQuadros note how rising rates and home prices are driving “a shift away from single‐family projects (which are more likely to be related to home ownership) toward rising multi‐family construction (more likely to be related to rental) as builders seek to meet the need for housing.”
Propy (www.propy.com), the leader in real estate blockchain technology, has launched title and escrow services for residential real estate transactions in Arizona, Colorado and Florida, in a move that makes faster, more secure transactions a reality for buyers, sellers and agents in those states. (Digital Journal)
Working remotely: A.J. Steigman manages his Atlanta real-estate brokerage firm from his house in Parkland, FL. From 600 miles away, he purchased or leased over 300 homes for investors worth more than $80 million last year, making him the top real estate broker in the Atlanta metro area in
2021. (WSJ)Airbnb > apartments: According to an April report from broker Douglas Elliman Real Estate, the total number of short-term rentals in Manhattan, Brooklyn, and northwest Queens has been hovering at just over 7,500. That compares to somewhere between 10,000 and 20,000 entire-apartment or entire-home Airbnb rental listings across all of NYC, according to AirDNA, a third-party site that tracks short-term rentals. However, Airbnb says the reality is different than the numbers suggest. (CRE Daily)
President Biden laid out a plan Monday aimed at closing the housing shortfall across the U.S.. Doing so will be an uphill battle: The administration’s previous affordable housing proposals floundered under the failed Build Back Better reconciliation bill. Still, housing advocates reacted enthusiastically.