PROView - October 2008 - (Page 12) Brokerage Design Will You Enter the Race? by Jeremy Conaway, Founder and President of RECON Intelligence Services Last month’s Brokerage Design column pointed out that, according to many credible experts, the industry is now in the last 11 months of the distressed real estate market that has plagued our industry for the past thirtyeight months. Other experts suggest that the 11-month estimate might be too optimistic. Whether one agrees with 11 months, or 18, is not relevant to the challenge that lies before the American real estate broker. The fact is that the end is in sight. The real question is what firms will enter the coming horse race, and place well for the lineup at the beginning of the next ‘up’ real estate market? The answer is simple. The opportunities of the next up market will belong to brokerages who, well before the onset of the new market, create and implement business plans that overcome three hurdles, and focus the firm’s efforts and resources in four critical areas. aspects of the marketplace will transition faster than the mind-set of the American real estate consumer. There is really no way to measure the mid and long term impact that the “psychology of down,” -- the emotional impact of negative mass media, the burden of distressed properties and the stress of sliding property values -- will have on the consumer. It is sufficient to say that these forces will negatively impact consumer confidence. A firm’s recovery strategies and business plan must address this issue head on. Time to Buy Another factor in play here is the fact that earlier industry initiatives to convince consumers to reenter the market through “time to buy campaigns” may The majority of the industry have negatively impacted the maintained an agent-centric industry’s credibility in the eyes business model and focused on of the consumer. Combating this effect may be as simple as Civic and Boomer generation partnering with an entity that has a higher level of credibility. The purpose of this article is to provide brokers and brokerage executives with guidelines they can use in creating their own unique approach to the new American real estate market. customers to the exclusion of X and Y generation buyers and sellers. Success in the new market will require a new approach to these issues. It is important to recognize that the challenge of 2009 will be as much a mental health exercise as an economic or business experience. From the outset, recognize these two things: 1) The up market will return (although not at 2005 levels); and 2) When the market returns, it will be a significantly different business environment than existed at the onset of the current down market cycle. These predictions are specifically aimed at those executives who believe that by just hunkering down, their survival will guarantee their success in the next up market. That simply is not true. Finding the Right Horse A firm’s business plan will be its thoroughbred as they enter this Triple Crown. This is not just one sprint. One must establish training and performance goals, study each unique track, and run well throughout the season. The winning plan will set forth the strategic and tactical objectives and initiatives that the firm will employ at each turn throughout the season. Without a unique plan a firm can be nothing more than a spectator. The last real estate boom lasted from 1992 to 2005. During this thirteen-year period the majority of firms did little to differentiate themselves from their competition. The majority of the industry maintained an agent-centric business model and focused on Civic and Boomer generation customers to the exclusion of X and Y generation buyers and sellers. Success in the new market will require a new approach to these issues. The Three Hurdles The Psychology of Down It is likely that the economic 12 PINELLAS REALTOR® ORGANIZATION The Four Critical Areas To enter this race, firms must implement a business plan October 2008
Table of Contents Feed for the Digital Edition of PROView - October 2008 PROView - October 2008 Contents Chairman's Notes Feature Story PROActive Brokerage Design Marketplace Analysis Home Sales Report MLS Update MLS Mind Your Manners Calendar of Events & Programs New REALTOR® and Affiliate Members Technology PROView - October 2008 PROView - October 2008 - PROView - October 2008 (Page Cover1) PROView - October 2008 - PROView - October 2008 (Page Cover2) PROView - October 2008 - Contents (Page 1) PROView - October 2008 - Chairman's Notes (Page 2) PROView - October 2008 - Chairman's Notes (Page 3) PROView - October 2008 - Feature Story (Page 4) PROView - October 2008 - Feature Story (Page 5) PROView - October 2008 - Feature Story (Page 6) PROView - October 2008 - Feature Story (Page 7) PROView - October 2008 - PROActive (Page 8) PROView - October 2008 - PROActive (Page 9) PROView - October 2008 - Brokerage Design (Page 10) PROView - October 2008 - Brokerage Design (Page 11) PROView - October 2008 - Marketplace Analysis (Page 12) PROView - October 2008 - Home Sales Report (Page 13) PROView - October 2008 - MLS Update (Page 14) PROView - October 2008 - MLS Update (Page 15) PROView - October 2008 - MLS Mind Your Manners (Page 16) PROView - October 2008 - Calendar of Events & Programs (Page 17) PROView - October 2008 - Calendar of Events & Programs (Page 18) PROView - October 2008 - New REALTOR® and Affiliate Members (Page 19) PROView - October 2008 - Technology (Page 20) PROView - October 2008 - Technology (Page 21) PROView - October 2008 - Technology (Page 22) PROView - October 2008 - Technology (Page 23) PROView - October 2008 - Technology (Page 24) PROView - October 2008 - Technology (Page 25)
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