The Real Estate market has been booming for years, but record inflation and increased interest rates may result in a more balanced market in the near-term. We talked to Real agents and brokers about their advice for fellow agents as we approach a possible shift in the market following years of explosive growth.
Mindy Newton, a Washington State-based Real agent said, “The basics always work: lead gen and lead follow up. Agents who are willing to work will see the opportunity in the market shift. I was fortunate to start in 2006 and built a great business in a correcting market. Everyone can, but not everyone will. This is a great market for those willing to do their part and help clients understand and make great choices.”
Jason Lopez, a Real broker in California, shared his experience from 30 years in real estate: “I started in a severe down market with short sales and high rates. One thing I’ve learned is that change is inevitable. The market cycles. We have been in this current top of the market cycle for years longer than what may be considered a normal amount of time. The downturn will come, but unless major changes happen with inventory, don’t expect prices to crash. Be prepared for fewer sales, higher rates, and more buyer demand. Then things will shift again—they always do."
Chris Warhurst, a Real broker in Utah, shared her perspective: “I am grateful. Change happens. It feels more fair for the buyers and less crazy. We are still busy and things are moving, just not as quickly as they have in recent years.”
Cody Steck, a Real agent in Utah, said that his market has already started shifting. “Listings are going to get harder and sellers will have to be more realistic. It makes for a better environment for buyers despite higher rates. People will ALWAYS be buying and selling for one reason or another, so continuing to build a brand around yourself (through YouTube, social media, advertising, etc.) as an agent, in my opinion, is the best way to handle any and every market shift."
Otis Wellborn, an Ohio-based agent, agreed that these are interesting times: “The key to success in any market shift is to love on your database; keeping in touch with them and keeping them informed of potential market shifts and how those shifts could affect their properties. Being a resource to your database will always open the door for future business. Your database always provides the highest rate of return in the form of word of mouth marketing on your behalf. The one thing that we must all keep an eye on is the Department of Justice’s ruling on how commissions will potentially be paid out to agents by buyer clients. This happening will really shake things up in our industry.”
Aritt Davis, a Real broker in Mississippi, shared that his markets can vary wildly based on a number of factors. “One of the main contributing factors to describing a market area within the state is centered around the quality of schools and opportunities for employment. Those markets where both are good seem to weather storms better than those where either or both of those indicators are lacking. As interest rates and inflation continue to rise, agents will need to become more adaptive in their lead generation and execution. Not that things will be taking a nosedive anytime soon because our inventory is still dramatically low, but we will begin to see a softening of the market as a whole. Unfortunately, homeownership may slip from the grasp of some would-be buyers due to affordability and others will have to make concessions in their list of wants or needs. But the savvy agent will find niches and pockets of the market in which to thrive in the coming cycle. Just be sure to educate your clients on what impacts rates will make on their purchasing power in a way that demonstrates this is just a correction to normalcy and not a need for distress.”
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