Above, left to right: J. Lennox Scott, chairman & CEO, John L. Scott Real Estate; Jim Fite, president & CEO, CENTURY 21 Judge Fite Company; Vanessa Bergmark, owner/CEO, Red Oak Realty; Chris Trapani, founder & CEO, Christie’s International Real Estate Sereno; and John Featherston, founder & CEO, RISMedia. Photo by AJ Canaria.
While low inventory, rising mortgage rates and a host of other obstacles that continue to change the dynamic of the real estate industry as we know it aren’t likely to fade away anytime soon, with the right strategies and expertise, even the most difficult challenges can be overcome.
Breaking down the national market and economic trends, a panel of leading brokers representing key regions of the country discussed how they’re handling both the challenges and opportunities during RISMedia’s 35th Annual CEO & Leadership Exchange earlier this month.
Moderated by John Featherston, founder and CEO of RISMedia, the session titled, “The State of Real Estate: The Broker Perspective” featured Vanessa Bergmark, owner/CEO of Red Oak Realty; Jim Fite, president and CEO of CENTURY 21 Judge Fite Company; Chris Trapani, founder and CEO of Christie’s International Real Estate Sereno; and J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.
And while panelists shared a variety of strategies for navigating the current market—as well as their plans for the future—they all agreed on the importance of adapting to market changes and focusing on growth.
Relationship database engagement
Kicking off the conversation, Scott focused on the fact that when it comes to today’s market and closing out the year, “what you see is what you get.”
“This is it,” explained Scott. “Over the last couple years, of course the pandemic and then we had major government spending and energy costs go up—and that’s why we’re in the predicament we’re in. If you went down the freeway and you saw a big truck, a jackknife, that’s what happened to housing. We got jackknifed.”
So what will it take to outperform the market? According to Scott, while the company already walks in excellence, now it’s all about helping each individual broker with their relationship database.
“We know their database isn’t moving in the normal sequence,” said Scott. “Thirty-five percent aren’t moving because we did too good of a job in helping them refinance, so now we have to figure out how we’re going to get more referrals—and that’s where it comes to supporting our brokers with their database.”
A key focal point at John L. Scott Real Estate today, Scott drilled down even further, underscoring the importance of engagement in order to drive referrals.
“Eighty percent of our listings come from our database—from the people we already know—but most agents in the industry don’t have a database…and they’re not engaged,” said Scott.
And while monthly newsletters and the like are nice, engaging with one’s database must be bigger.
“It’s their home anniversary, a client event, a home valuation or a stop-by,” added Scott. “It’s that type of engagement and encouragement that will lead to more referrals.”
Right-sizing with a growth mindset
The conversation continued with Trapani highlighting the importance of recruiting and retaining the right people while constantly evaluating expenses and implementing cost-saving measures.
“The most challenging aspect right now is balancing the ongoing right-sizing of the business while maintaining a growth mindset,” said Trapani, who is laser-focused on net recruitment growth.
“A lot of firms will talk about how much volume or how many people they recruited, but they’re not really talking about how many they lost—and so I think the net recruitment growth is really important.”
With 32 years of experience under his belt, Trapani circled back to right-sizing—something brokerages across the board are contending with today.
“There were a lot of years where big offices just sat in the same locations and everything kind of stayed the same. But we’re in the time and space where everything is always changing, and so, the question is what are the needs of our sales and support staff?”
To that end, Trapani and his leadership team are opening the lines of communication with their agents, asking them about their needs. The results, according to Trapani, have been surprising.
In fact, two of his top agents recently noted that they’d be interested in moving out of their office and into a cube—a shift that has become more mainstream as we leave the pandemic years behind.
“I think we can actually be more aggressive in some of these areas if we’re having open and honest communication with our salespeople,” said Trapani.
An independent advantage
“We certainly don’t need offices,” stressed Bergmark, who explained that for Red Oak Realty specifically, there’s really no push for them coming back when the company can now fit 200 people in three offices rather than five.
Having reduced the firm’s footprint by nearly 40%, Bergmark and her leadership team have doubled down, utilizing their staff in a much stronger way—allocating the money they’ve saved on office space to put new processes in place.
“As an independent, everyone always asks, ‘how are you surviving?’ But the question isn’t how independents survive. Rather, it’s that we have the ability to get out in front of things a lot faster. That’s the advantage,” said Bergmark.
To that end, when AI was coming, rather than being looked at as a shiny penny, the focus, according to Bergmark, was on how it would fit into the company’s day-to-day operations.
“Every last drop of content that we’re touching is now going through AI, and that was adopted probably within seven to 10 days of ChatpGPT coming out,” explained Bergmark, who has set her sights on positioning the firm for the market’s eventual upswing.
“We’re going to keep our staff, but we’re going to use them in different ways while making sure everyone maintains having a job, because when this market turns, I don’t want to be out hiring,” she added.
Company culture and core values
Next, Fite addressed the importance of both company culture and core values within the merger and acquisition (M&A) landscape.
While focused specifically on roll-ins today, mergers and acquisitions have played a role in the company’s growth over the years, and according to Fite, culture is key when it comes to finding the right fit.
And with so many different business models to choose from, ensuring that cultures are compatible is perhaps more important than ever before.
“Mergers and acquisitions add opportunities,” explained Fite, who noted that for the first time in the company’s history, he’s looking outside the Dallas Fort Worth area to leverage M&A opportunities—setting the 86-year-old company up for another 80 years.
“We’re not here to survive. We’re here to succeed. And so we’ve got to make sure they’re the right fit.”For Fite, that begins with staying true to the company’s core values.
“We stand on our core values, as they’re critical to our success,” said Fite. “They’re the foundation of our company, therefore we hire, acquire and train to them. And we talk about them all the time.”
Heading toward the future
Wrapping up the conversation, Featherston asked the panelists about their priorities heading into 2024 and what they’re doing differently as the new year approaches:
“During these times, I think there’s more opportunity than less. And looking over the past 18 years, we’ve actually gained the most ground during downturns, so the idea is positioning ourselves for the upswing, as Vanessa said, and we all know that will come.” -Chris Trapani, founder & CEO, Christie’s International Real Estate Sereno
“There’s a lot more opportunity now in recruiting than there has been, because if people are a little bit unhappy, they’re open for a conversation. I’m really focusing on those new agents, because they’re adapting to video, this market and these interest rates. They’re really fresh, and you don’t have to untrain them.” -Vanessa Bergmark, Owner/CEO, Red Oak Realty
“It’s following through on the relationship database engagement. Nothing else. Triple the focus on that one item is going to carry us forward and get us some business in the fall.” -J. Lennox Scott, chairman & CEO, John L. Scott Real Estate
“I’d love to say it’s different, but it’s not. The ‘aha’ moment is what we do best: recruit, train, retain and refer.” -Jim Fite, president & CEO, CENTURY 21 Judge Fite Company