Last Updated on March 17, 2021
Welcome back to our 2-part series on real estate trends in 2021. Last week, we covered the impacts of Housing Affordability, as well as industry-caused changes within franchises and groups like Realogy and eXp.
These trends both have a huge impact on your business, so if you missed last week’s article make sure to take a moment now and give it a read, but I have to say – the next trend I’m about to cover absolutely shocked me… and it will shock you too.
The Lead-Generation Model
There’s an entire chapter of the Swanepoel Report dedicated to showing brokerages how they can get larger splits from their agents by generating leads for them. That’s right, an entire chapter covers how brokerages can make more money off you… 20-30% more profit (up to an 80% split) to be exact, by generating cold leads and taking on more of the responsibility to convert them.
As I mentioned this shocks me, but I can’t blame them because this follows some general trends and it’s in their best interest. Cold leads have grown as a percent of total yearly sales. Additionally, lead generation and advertising costs continue to go up, which can be prohibitive to individual agents.
However, I feel like we’re missing the forest for the trees. For example, statistics from NAR shows us that 66% of Sellers find their agent because they knew them or were referred. From this we know that the majority of business is not coming from cold leads!
So, why would you want to work harder to convert a cold lead? Especially when they don’t account for the majority of the deals out there! Don’t forget where your business comes from.
I speak with agents every week who make a 6 figure income without ever having to convert a single cold lead – because they use tools like Service For Life!® and I know that you can too.
The Post Pandemic “New Normal”
The Pandemic had quite the impact and in the short-term, negatively affected the real estate market. However, Agents, Brokerages and Associations quickly worked to adapt to the new regulations and the market bounced back in Q3 and Q4. I must say, great job everyone – it was an exceptionally hard change and on the whole our industry handled it extremely well.
With that being said, the last year has certainly changed some things in our industry, and the Swanepoel Report did a good job of covering what trends might stick around and which will fade. Some of the changes that are particularly important to agents include:
- A lot of staff were transitioned to work from home, and unfortunately those that were let go are not immediately returning. This is both inside and outside of our industry, so keep in mind that industry services might not work the same way they used to.
- Brick and mortar offices will continue on, but in a changed capacity. Many brokerages are considering downsizing and changing their layout to include more meeting space and less individual desk space.
- Video meetings will remain popular, but not at the same level as mid-pandemic.
- Virtual home shopping and closings have increased in adoption, but a lot of people still like being physically present for both. If you’re not already using virtual tours or paperless documents, it’s time to dive in.
- Suburban relocation will continue as remote work becomes more widely adopted.
Managing Diversity & Inclusion
I feel I need to mention one more chapter within the Swanepoel Report: Managing Diversity and Inclusion. I know this has made the news recently, but in looking at the numbers I’m not sure it has become a trend. As the report shows, there’s still a disparaging gap between the percentage of the population of each race and ethnicity, and their corresponding percentage of homeownership and industry representation. If we are trending in the right direction within the last year and the reported numbers don’t show it, I certainly hope it continues.
Even though it may not be a trend, I must say, the Swanepoel Report does a good job of covering the history of the subject as well as some of the initiatives that various groups like NAR, Realogy, NAREB, NAHREP, AREAA, Keller Williams and T3 Sixty have taken.
I think the best thing we can do to either start or continue this trend, is to get educated on the topic. If you’re looking for resources, I’ve included a handful of them below. The Facebook and Clubhouse groups are both great sources of information as well as places to ask questions and further your search.
- NAR Fair Housing Simulation – https://www.nar.realtor/fair-housing/fairhaven
- NAR Implicit Bias Training
- Facebook Group: Deliberately Fair Housing
- Clubhouse: Real Talk – Race & Real Estate
- Free University Courses – Search for courses on Inclusion in the Workspace at your local universities.
Time To Adapt – I Know You Can!
In the words of William Arthur Ward, “The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”
The agents who are most successful are not those who stick to what they’re doing and complain about the wind, they are those who readily accept change and adjust their sails in the face of adversity. I know you have it in you to keep following the major trends and adjusting your business to prosper – good luck this year!
2 thoughts on “Trends That Will Shape Real Estate in 2021 – Part 2”
All the more reason to build your own book of business and keep in constant contact with them. My circle is the best source of leads to me and I haven’t had a lead from an “up-call or my office” in years and I’m as busy as I can handle or want to be. Although I have to say having ready and able buyers in a market where there is limited inventory and lots of buyers with pockets full of money has been a real challenge for buyers who would be very happy in a “normal’ market. Not sure how long they will continue to loose out on properties because of cash offers or “waived everything” offers.
You’re so right Carol! It sounds like you’ve got it figured out and have built that consistent business so many agents dream about. What do you mostly use to follow up and stay consistent with your circle?
I hear ya about this market – things are wild right now and there’s definitely a lot of buyer fatigue going on. Heck, there was buyer fatigue in your market before the market has become this crazy. A friend of mine who was renting a place across from Fenway put in 30 offers before she gave up… and this is 3 years ago! Are you doing anything specifically to try and get listings from your sphere?