Like many an industry catch phrase, ‘The New Normal’ has quickly risen to real estate vernacular. But what does the term really mean? Is it, in fact, even valid? Two tell-it-like-it-is members of RISMedia’s Real Estate Information Network® (RREIN)—Joe Clement, Broker/owner, RE/MAX Properties, Colorado Springs, Colorado and Todd Hetherington, CEO, Century 21 New Millennium, Metropolitan D.C. area—discuss what it takes to succeed in The New Normal…and beyond.
Seems like everyone is using the term ‘The New Normal’ to define the real estate market as we know it today. In your opinion, is this an accurate term? An overused term? Why or why not?
Joe Clement: I don’t like the term. I’ve been in this business for 33 years. I’ve seen four recessions, 17% interest rates, and I’ve seen hot markets, too. After you’ve been in this business for a while, you get used to the fact that you can never be complacent with what’s going on because it’s probably going to change. There are always external factors that affect the business, whether it’s interest rates, the economy, jobs…whatever. We are going through challenging times; we are going through some adjustments that are, quite frankly, necessary.
Todd Hetherington: The term is irrelevant. You can call it what you want…The New Normal, rational reality…anything, it really doesn’t matter. We call it life. You deal with it, adapt, learn how to play the game under the new rules and master it, or you get left behind.
Has The New Normal officially arrived? What does it look like?
TH: Sure. We are all forced to deal with what life brings our way each and every day. Over the past several years, life has thrown at all of us in this industry the challenges of dealing with short sales, REOs, declining prices, tightening credit standards, mortgage reform…the list goes on and on. To me, The New Normal is about how we rise to these challenges and what we do to overcome them.
JC: What we got into in 2002 through 2006 was craziness. I keep telling my agents and clients that we are going through something that is necessary. We are going through challenging and frustrating times, but we have to get to the other side. We have to get through a whole bunch of issues before we see a real estate market that is more on a steady pace of appreciation.
What are the critical skills brokers and agents must possess to succeed in The New Normal?
JC: We have increased our education tremendously over the last three years. In the 2000s, we got spoiled. We had people who forgot what their job really was. As a real estate professional, our daily job is lead generation. My job is to generate leads for agents through different technology systems. And you have to have education, from one-on-one training to group classes. You have to be serious and committed to succeed right now. This market is great for getting rid of those who are not committed to lead generation, education and going to work in the morning and doing their job.
TH: The first skill is flexibility. We need to be able to adapt quickly and efficiently in order to meet all of the challenges. The second skill we need to master is becoming business-oriented. In the past, many broker/owners have been excellent REALTORS®, but terrible business people. Today, we have all been forced to get a little smarter and analyze the ROI on everything we do. We have had to develop far more comprehensive, written business plans detailing every facet of our business. All our branch leaders and directors have detailed action plans calendared out in order to achieve their three main objectives of recruiting, retention and lead generation. We teach this same type of business planning to our agents. It works.
The third skill is focus. We have to have a laser focus and only do those activities that pertain to achieving those goals in our plan. Even though we are beating every one of our metrics—units, volume, sales price and, most importantly, profitability, we still push each other in an effort to continue to raise the bar.
