Friday Flash:
Riding the bull

The past couple weeks have been interesting, huh? Yeesh. I hope you’re doing OK. 

I’m feeling a little reflective today. So, what follows is a bit of a ramble. Just some thoughts and impressions about it all. Take it for what it is. 

At an internal 1000WATT meeting a few days ago, I likened the past four years to flying through an asteroid belt. 

At this time in 2020, the real estate market had flatlined. County recorder offices were closed in many places. Stocks were in freefall. We pondered physical and business mortality. 

Then it all snapped back. Thousands of people jumped into the real estate business. Money was close to free. Some agents I know barely remember 2021. Many with dubious skills made more money than they had in their lives. Prancing unicorns commanded our attention. 

Until May 2022, when it began falling apart. Mortgage crashed, brokers cut, and we were all reminded that unicorns aren’t real. 

And now, while we were sitting around waiting for rate cuts, the NAR settlement… 

At least we’re in good crisis shape. 

When I do speaking engagements, I always tell people that “If you’re good, you’re good”, meaning that good brokers, agents, and companies will figure out a way to adapt. The past four years prove that. 

I think that’s still the case. 

But that doesn’t mean there won’t be ugliness if the settlement on the table, or something even more challenging, is approved. 

Because, first of all, our industry discussions about this are taking place as if consumers aren’t going to drive how this all plays out. We’re talking amongst ourselves right now, for the most part. 

We have no idea what happens when anti-Realtor sentiment is ignited at scale. This is the “known unknown” we have to consider.  

We Americans may shift our focus to the presidential election in the coming months, move on from our moment of real estate industry awareness, and just go with the flow when our time to buy or sell comes. 

Or maybe our bad national mood grabs hold of this issue and doesn’t let go. And HGTV has made us all amateur real estate agents and contractors over the past decade, remember? Maybe buyers decide this is their DIY moment. 

We don’t know how it’s going to play out. So while I’m inclined to believe those who say this isn’t going to change things dramatically, I also think planning around that assumption is dumb. 

Here’s how I think about MLSs going forward: They’re like steakhouses that have been told they can no longer serve steak. 

They have a great caesar salad, nicely executed sides, and an appealing dessert menu. And of course martinis. 

But steak. It’s the thing, and now it can’t be served. So survival requires a pretty serious format change. There’s still value there, but a reinvention is in order. It will be interesting to see how many can pull it off at the same time they deal with big brokers doubling down on office exclusives. 

I do think we’re going to see a lot of menu of service, flat fee buyer offerings spring up. There will just be more of those objects in the room. Most will be fly-by-night operations along the lines of the fee-to-list services that have operated in most markets forever. But they will condition conversations with buyers. 

Just a reminder: If you have a strong brand and value proposition, you don’t need to join the race to the bottom. 

The endless media comparisons between home buying and plane tickets or stocks drive me nuts too. It’s like comparing surgery to clipping your fingernails. 

But it’s the industry’s fault. When you put at least half a million unserious people into the world to help people buy homes, then set things up so they never need to talk about their compensation, or what their actual value is beyond opening doors and filling out forms, you create ignorance. 

Put the media outrage energy into sharpening your pitch. 

Let’s say buyer agent compensation doesn’t change much. That doesn’t mean there won’t be large effects. Many brokers have skated on thin ice for years. Losing even a few basis points on gross buy-side commissions could push them through it. 

Same thing with the agents that have just barely survived the past two years. Straw on the camel’s back and all that. 

Something I never understood: Puzzlement about the blanket offer of compensation. 

It’s a damn finder’s fee. What’s hard to understand (or fundamentally objectionable) about that? 

Yes, buyers have outnumbered sellers for years now. But a qualified buyer willing and ready to meet a seller’s ideal price and terms is not so easy to deliver. Who wouldn’t pay for that? 

I went to Dallas this week to check out the venue for our 1000WATT Brand & Marketing Summit coming up in June. We’re doing it at Gilley’s, a super-cool event space that came to fame after the release of the movie Urban Cowboy in 1980. They still have the original mechanical bull from the movie on-site, and I’m debating whether we should rent it for attendees to ride. It feels like a good metaphor for the times. 

You should join me at the event, bull or no bull. We’ve already sold half our tickets and I’m feeling really good about the program, which is going to give attendees a lot of what they need to succeed in these most weird of times. 

Enjoy your weekend.