Chris Kelly, 2022 Broker Relations Liaison, National Association of REALTORS® (NAR), President & CEO, Ebby Halliday Cos., North Texas
Charles Oppler, CEO, Prominent Properties Sotheby’s International Realty, Tenafly, New Jersey
Ann King, President, Berkshire Hathaway HomeServices Florida Network Realty, Jacksonville, Florida
Linnette Edwards, Partner/Associate Broker, Abio Properties, Oakland, California
Joe Clement, Broker/Owner, RE/MAX Colorado Properties, Colorado Springs, Colorado
Chris Kelly: We hear a lot these days about the “R” word—recession—and depending on who you talk to, we’re either in one or we’re not. As a real estate broker, I don’t know that it really matters. As those of us who’ve been around long enough to remember can attest, in only two of the last six recessions did housing values decline. In the other four, prices actually went up. What I do see now, with interest rates still reasonable and more inventory available, is a market returning to normal—a market with plenty of demand and, for competitive agents who stay out in front of it, the means to satisfy demand. Am I overstating that, Charlie?
Charles Oppler: I don’t think so. Ups and downs are par for the course in this business, and as the market normalizes, it’s time to take a breath and talk about adjustment—and education—both for newer agents and for consumers who haven’t been through these kinds of market shifts. Do buyers have less buying power than they did a few months ago? Sure. Are bidding wars less heated? Yes, and it may take fixing that fence or being more realistic about your home’s true value in order to get the best and fastest sale. But there’s no call for panic. There’s plenty of opportunity in this latest version of yet another new normal.
Ann King: I agree. After two years of pandemic-driven drama, we are beginning to see a more balanced market—and that’s to be expected. Yes, we’ve doubled our inventory over the past few months, but that still only gives us a two-month supply. That’s way down from the six-month supply we consider normal. Prices are holding in our market, which continues to be a popular destination, and when sellers are realistic in their expectations, properties sell very quickly.
Linnette Edwards: We’ve seen a much more dramatic change in Northern California’s East Bay, where I would say we’re now on pace with our 2019 numbers. We have a five-month supply of inventory, and pending sales have dropped significantly. So have home prices— sometimes as much as 10%, especially in the higher range, say $2 million and above. There’s no question we’re seeing a market adjustment and the quickest turnaround I’ve seen in my 20 years in the business.
Joe Clement: We’re seeing quite a cooldown as well—there were 2,300 listings on our MLS last time I looked as opposed to 600 last January and a few more price reductions of late. But there’s still some competitive bidding going on for desirable, right-priced properties, and frankly, we’re overdue for a bit of a breather. We all know the frenzy of the past two years was not sustainable. It’s time to buckle down and deal with it.
CK: So, statistics are a little different depending on where you are, but the basic tenets are the same; as the market becomes more balanced, our strategies need to change. What are you focused on right now?
AK: Education. We’ve kicked it up a notch for agents with videos and marketing materials, and our company-wide meeting this month will be packed with roundtables, tools and resources on how to reset that referral button, be a better negotiator and get going with best practices. It’s good, solid basic training to help them finish strong in 2022 and go into next year prepared.
CO: We are accepting the different variables post-COVID and getting our people prepared to make adjustments.
LE: We’ll be a little leaner and meaner in budgeting, but we are doubling down on tools and resources—improved CRM tools and lots of classes and coaching. This isn’t a time to freak out, but it is a time to mentor and prepare our sales force.
JC: It’s also a time to reeducate consumers, who’ve had some skewed notions about what to expect over the past couple of years. We’re using social media and a lot of direct mail to paint a more realistic picture.
CK: What’s your outlook for 2023?
AK: People always need to sell, and people always need to buy. No matter what happens in 2023, that fact will not change.
JC: The truth is, we’ve got the lowest unemployment numbers in decades, and people have money in the bank. There’s an opportunity for buyers and sellers and for agents who know about buydowns and other strategies to help bring them together.
LE: Typically, they say the top two percent of agents do 90% of the business—and that’s probably true in any market. Whatever you call this period we’re in, you’ll have to adjust and prepare, or go home.
CO: And if you look at the stats, there’s something like five-and-a-half million home sales projected for 2022–23. That’s 11 million sides—and that’s a lot of business up for grabs.
The Power Broker Roundtable is brought to you by the National Association of Realtors® (NAR) and Chris Kelly, NAR’s Broker Relations Liaison. Watch for this column each month, where we address broker issues, concerns and milestones.