Building a Defendable Market Position
A lot of the topics I write about come out of ideas I get during our office meetings. Our agents love Monday morning meetings. It is a great way to start the week. It pumps everyone up. It is energizing. Agents talk about open house experiences while they are fresh in their minds.
This week we talked about the changing market. It has happened quickly. We are still positive, but the market has changed nevertheless. Two months ago the ratio of sales at or above asking to sales under asking was about 50/50. A month ago it was about 30/70. It is now 10/90. Simply put, we are not seeing the buying frenzy we saw a few months ago. The number of transactions is still very good, but agents are working harder to put the deals together.
This simple discussion about changing market conditions made me think about our position as a company in the market place. Our success as a brokerage is based on several core competencies; Solid management, great training, consistent advertising, strong online presence, and good client and agent support to name a few. As the market starts to balance out, these assets become so much more important.
Recently I met with two great agents. As a well thought out team, they have achieved remarkable success in less than 6 years. Their current company had grown by over 400% since they started. As much as they loved their company they were getting lost in the shuffle. They needed a change. Surprisingly, their biggest concern was not commission splits but moving to a company that had management that could advise them through the new economic environment. You only need to visit our website to see the depth of knowledge our management team has.
I have also hired a couple of new agents. They are committed to making a solid career in real estate abut chose us because of our exceptional training. Our in-house program provides agents with the same level of experience as someone who has been in the business for two years.
Finally, I talked to an agent who works for a very small boutique company downtown. She is one of their more successful agents but simply cannot grow her business anymore. Her current company hasn’t the resources to increase their presence in the marketplace. There is no support from the “back office”, there is virtually no marketing or advertising, no on-line presence and no training. The decision to move is compelling when you look at what we offer in a similar, but larger, boutique environment.
I have been blogging about brokerage best practises for awhile now, but many of the key elements to brokerage success will be of little use if you don’t have a defendable market position. Change in market conditions happens quickly. If you are paying close attention to your office generated statistics, you will probably notice things changing in as little as two months. Surprisingly, a few companies aren’t aware of the cyclical nature of the real estate business. Many agents and some companies have never worked in a balanced market let alone one that favours buyers. The way you conduct your business changes significantly. All of a sudden, selling a home is no longer a slam dunk.
At the end of the day, your brokerage will succeed if you stay on your toes, invest wisely in your business, recruit carefully, pay attention to slight changes in the market, and continue to build your brand on the fundamentals of honesty, integrity and knowledge.