Environment

Will The Lack of Inventory Be the Real Estate Agent’s Downfall?

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Sales, like many high income potential careers, has always been competitive. In the residential real estate industry, where the value of homes sold is expected to exceed $2.5 trillion in 2018, market conditions are going to contribute to competitiveness for both real estate agents and homebuyers alike to reach their goals. For the first time, that I am aware of, there are more active Realtors than there are active listings to begin a new year. (See graph below. Data from realtor.com and NAR monthly membership report.)

The number of Realtors is slightly down from the peak of real estate market in 2006, but the inventory levels continue to decrease. We are now entering the 11th straight year of single family home construction being at historically low levels. (See graph – info from Census Bureau)

This decade of low activity in single family home construction is now affecting the 4+ million millennials who will continue to turn 31 (current average age of first time homebuyer) every year for the next 10 years. Prices will continue to rise and increase at a higher annual rate than wages. The good news is that unemployment is down, but wages are not growing at the same pace as housing prices. The projection for an 8% increase in 2018 of single family construction still leaves a big shortage and is lower than the actual building that occurred during the 1980 recession when unemployment was at 7.5% and would grow to 10%.

While financial advisors debate whether a home is a good investment, I’ll end the argument for them – it is. The median net worth of 65 year olds in this country is $194K, if you take out the equity in their home that drops to $43K. More importantly, the house is not a commodity, it’s a home that gives people freedom and is a part of the majority of American’s idea of living the dream. New business entrants need to enter the discussion with local and national government agencies on how to get more single family entry level homes built. That is currently not happening.

Knowing the competitive landscape, what should you do as a real estate professional who wants to grow their income in 2018? A massive amount of money has been invested in companies looking to change the dynamics of the real estate relationships between consumers and agents, and brokerages and agents. The quality and sources for accurate housing data for consumers continues to improve and is becoming easier to access. The consumer with the iPhone is in charge. But who will own the relationship to assist them with the biggest and most complicated investment in their life? It should remain the local, micro market expert. Potential homebuyers and sellers will do a lot of research, however, research doesn’t equate to knowledge and taking action to buy or sell.

What agents need to do immediately is have an aggressive plan to market themselves on social media (Facebook, Instagram, LinkedIn, Twitter), as well as through traditional online sources, and take massive action to build their local brand. If they wait, others will take advantage of their lethargy and position themselves as the go-to source for navigating the home purchase, and in the best scenario they charge the agent a 35+% referral fee. The worst case scenario is the new entrants keep them as their real estate customer. Forget the noisy discussions amongst the largest brands about who is going to own the real estate data. The reality is that agents who have owned the real estate consumer relationships have up to three years to make a commitment to establish themselves as the micro market expert and own their database. Who is going to succeed in the low inventory/high tech world? The agents who build, own and invest in building their brand reputation, will remain the trusted source.

This is your road map. The question for agents to ask themselves knowing this to be the true path is: Who Do You Want to Be in Real Estate?

5-4-3-2-1, Go!

All the best in investing in yourself!

Peter

Viva United

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I want to personally thank all of our coast-to-coast attendees, our sponsors, brokers and agents from our host city, the great speakers and the United corporate staff who made the 2018 United Real Estate Convention a high-energy, impactful event! There is no question that United is a company filled with passionate, driven individuals who are willing to take action to improve their business, improve the lives of our families and the communities we serve.

We strive as a company to be different – and that starts with the relationship we have with our agents. We partner with our agents to not only sell real estate, but to help them create a lifestyle that is based on who they want to be. Other companies have focused their training by asking “What do you want to do (in sales)?”  This question revolves entirely around a financial number. A better way to ask this question is to say, “Who do you want to be?” and then build a business and plan around the answer.

Determining who you want to be and developing yourself will put you on the one true path to long-term success. In the 24/7-connected world of iPhones and social media, the entrepreneurs who will prosper are those who are sincere, trusted and liked. Being authentic and true is an important part of that equation. So, start taking action towards who you want to be, be genuine, and the rest will fall into place.

To quote Mel Robbins, our Viva United Keynote Speaker: “If I have a problem that can be solved with action, I don’t have a problem.”

Next year’s convention is in Nashville, Tennessee – and it’s one you won’t want to miss. We will continue to raise the energy level of the event and the growth opportunities for our brokers and agents. Look for pictures and videos to be posted soon to recapture the fun!

All the best,

Peter

Tax Changes and How to Increase Your Sales in 2018!

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While attending the National Association of REALTORS® (N.A.R.) conference this past November in Chicago, there was an air of uncertainty about housing that I have not seen since 2007 when it became evident that the housing crisis was real.  By the end of 2008, the Case-Shillar housing price index reported its largest price drop in its history. Housing prices in most urban and suburban areas struggled to recapture their value before starting to rebound in 2013.

The theme of the 2017 N.A.R. conference, “The Sky’s the Limit”, focused on raising attendees’ real estate careers to higher levels.  With a pending massive tax legislation being proposed, the idea of raising your income in 2018 was an immediate challenge to envision. This time, the uncertainty at the major real estate conference of the year was not about the financial stability of households, the economy, or the quality of mortgage underwriting.  It was legislation proposing the elimination of mortgage interest and property tax deductions. These deductions have helped to promote and incentivize homeownership, helping millions of families realize the American dream of owning their own home. Eliminating those deductions completely would have a major negative impact on housing markets across the United States.

Credit is certainly due to the N.A.R., as their efforts helped impact the decisions of congress. The deductions stayed in the tax reform that passed into law. However, there are now limitations that affect certain areas more than others. Specifically, high tax states such as California, New York, Connecticut and New Jersey, where it is estimated that 30% of homeowners pay more than $10,000 annually in property taxes. The limitation for interest deductions on mortgages above $750,000 will give pause to buyers in the luxury market, and the elimination of the interest deduction on home equity lines combined with the maximum mortgage deductions will also affect individuals who are considering buying a second home. If you are already close to the $750,000 mortgage cap on your primary residence, buying a second home will not have the same benefit of ownership, as the additional interest and property deductions would be eliminated and not tax deductible on that new residence. You also are less likely to take out an equity loan for a down payment on a vacation home.

How local real estate markets will be affected by the new law remains to be seen. What is clear for 2018 is a universal agreement amongst economists that there will be a modest, at best, increase in the number of home sales. This means more competition for real estate buyers trying to purchase an affordable home and an increase in competition amongst REALTORS to build their client base.

What will it take to grow your income in 2018? First, you will need to become an expert. Not an expert in your entire city, but an expert in a micro-market. Real estate consumers will do their research and will want to work with someone they like and trust. That trust will be gained in 2018 by agents who position themselves as micro-market experts, not generalists. Second, develop the thinking of an entrepreneur. Being an entrepreneur in real estate is not only a business model, it is a mindset. You need a mindset of positivity, growth, and personal accountability in 2018 to raise your income.

To learn more about the 2018 market, micro-markets, and developing a mindset of growth, please view my Facebook live interview with RealTrends at the N.A.R. conference.

https://www.facebook.com/realtrends/videos/10154962768797927/

Best wishes for growth in 2018!

Peter

Determine Who You Want To Be And Grow Your Business Exponentially

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We recently completed our annual business planning workshops where over 1,000 United® Real Estate agents participated and I am extremely enthusiastic about their future. Those in attendance ranged from recent graduates to experienced individuals switching careers to long-term real estate professional. Each attendee was introduced to the first component of successful planning – knowing your why and who you want to become.

It does not matter where you are in your professional career. Every day we see images on social media and read about people who accomplish what we classify as “incredible achievements.” It’s important to note that before they achieved success, every one of them took the same initial step – they decided who they wanted to be, what they wanted to do and that they were going to create their success.

Choosing to create your success today is a deciding moment that will change the course of your life. The path you take and the decisions you make will have an effect on those you meet along the way and, most importantly, be the architecture that drives your end result. Write down today’s date; take a picture of yourself as a reminder and memento that you can show others when your deciding moment happened. Despite the changes in technology, the global economy or your own local real estate community, concentrating on becoming who you want to be will allow you to achieve what you need to be successful. With that stable foundation, the changes you encounter in life will not affect who you are or who you will be.

Recently, United Real Estate was highlighted in a documentary series by trusted real estate source, Real Trends, on How to Grow Your Business. What began as a technology testimonial turned into a more in-depth overview of United. The shift in focus of the documentary occurred because of a common theme evident in our office owners’ and agents’ testimonials which demonstrated that United is more about the culture and the people of a growing company, rather than just the company objectives and strategies. Motivation comes from being empowered to become who you want to be. Once you discover who that is, what you need to accomplish your goals will become evident and you will look forward to the progress you make each week.

Click Here to enjoy the brief video documentary that is also available to view on our United Real Estate YouTube channel.

Thank you to all our local brokers and managers that helped make these successful, life-changing workshops a reality. When your dream is bigger than you are, you can either give up or seek help.  At United Real Estate, we are here to help!

Best wishes that you may always dream big!

Peter

Message to All Affected by Hurricane Harvey

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To all of our United family of brokers and agents in Houston.  On behalf of myself, and our CEO Dan Duffy, I know we speak for everyone inside of our United Real Estate Corporate office and throughout our growing supportive network of offices and agents, that you have been in our thoughts and prayers these past few weeks. Our immediate concern is still for you and your loved ones continued safety.  I have been in communication consistently with Dianne Moore, our and your leader in the Houston market.  She has kept me up to date of what is still an ever-changing dynamic for many citizens of the greater Houston area. We recognize that this is not only an enormous disaster, but also the largest natural disaster in the history of our country.

We are a country filled with people of resolve, and the citizens of the state of Texas have as much spirit as any group of individuals I have ever met. I know the waters will recede and Houston will begin to assess the damage, repair and rebuild.  Houston and its citizens will continue to be an example of a great large American city! It won’t be immediate and some areas will take longer than others, but business and the continued growth of the greater Houston area will resume.

Recognizing this, the United Real Estate leadership team wants to help the 240 agents who work for United Real Estate | Houston how we can during this transition time. An immediate action we will take is to waive your monthly fees for October, November and December. At this time our Houston office has not been damaged and we will open back up when it is safe to do so. We will ensure you have no interruption to the full support services you receive from United Real Estate, while removing the monthly fee obligation.

You should also know that your United family from California to New Jersey to Florida, everywhere in between, and back to Texas have asked how they can help.  Many have already donated to different charitable organizations to help the citizens of Houston.  All of us at United are continuing to think of you and will be in touch again soon on how we can support you and the greater Houston area to slowly but steadily get your lives and business back on track. We are United!

God Bless!

Peter

The One Chart That Explains Why You Can’t Find a Home to Purchase

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Summer is not only the time every school age child looks forward to, it is also the traditional time of year that many families eagerly look forward to buying a new home. In fact, historical home sales data shows that the month of June is typically the busiest month for buying and selling real estate. As the school year ends, families execute plans they made in the spring to move to a new school district or buy a larger home. This year the challenge that many will face is the shortage of affordable homes available to buy.

This shortage of available housing is not a short term problem. With an ever growing population and housing construction that lags way behind the country’s population growth, the lack of available housing will continue into the foreseeable future. While news headlines have covered the annual increase in housing over the past five years, the actual data shows that the number of homes for sale is still at record lows. When you look at the actual amount of new homes being built and take into consideration the continued population growth, a clear picture comes into view of what challenges still lie ahead for potential homebuyers (refer to graph below).

Keep in mind that the “increase” in new home construction in 2016, compares to the same actual levels of new construction in 1982, when the country was in the midst of a deep recession. However, after the 1982 recession, home construction immediately and significantly rose again in 1983. There is no such increase in new homes being constructed in 2017 and the population of the country has increased by over 100 million people since 1982.

Want to know why home prices keep going up and you can’t find a home to buy? It’s a simple matter of supply and demand. There is an ever increasing demand driven by a growing population and a lack of inventory of homes for those buyers in the market to make offers on.

With the current rate and foreseeable future of new home construction remaining stagnant, this won’t be a short-term problem but rather a systematic long-term challenge for many trying to buy their first home or next home. You can expect home prices will continue to rise and affordable housing options will be in high demand driving up prices to even higher levels. The supply of new and existing homes available for sale across the country will remain very tight.

Homeownership is not just part of the American dream of freedom and independence, but also the number one way for most people to improve their long-term financial security. While it may be costly this year to buy a home, more than most likely it will be even more expensive next year. The law of supply and demand won’t change. Your best bet is to sit down and build a personal plan to achieve your family’s home ownership goals and financial needs and begin to take action to achieve those goals. On this topic, time is of the essence.

Best wishes for a fantastic, fun-filled summer and a successful home buying season!

Peter

My 7 Essential Personality Traits for Success in Selling Anything

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Companies and individuals spend a lot of money on sales training in order to increase revenue, or in the case of individuals, to grow their incomes.  Entry level sales training teaches sales people what to say or present. More advanced training teaches salespeople what to ask.  Learning to ask questions to potential clients is a better way to gain more sales than just learning what to present.  However, there is still a large gap between sales people’s incomes who participate and complete the exact same question based sales training program.  Some of this can be explained by work ethic, more successful sales people typically prepare more and work harder.  However, while you can learn how to effectively ask questions to prospective clients, there are also certain personality traits I have learned that you will need to develop in order to be in the top 1% of wage earners in your profession.

In sales, asking questions is critical to your success. You have to ask questions to identify and qualify potential clients and then ask more specific questions to help uncover their real needs. In order to provide more value to the potential client than your competitors, you must ask better questions. If you become better at asking questions and develop the following seven traits, you will outsell everyone!

Empathy – People do business with individuals they like, but they are more likely to buy from sales people who demonstrate empathy towards them.  Empathy is not sympathy.  Empathy is the ability to understand another’s situation, feelings, and motives. It is one thing to be liked, it is another to be seen as someone who can relates to a client’s specific situation and offer guidance.

Ego Drive – Top sales people learn to develop internal motivation which allows them to work hard and be seen as confident. They also know there is a line between having the ego drive necessary to succeed, and being seen as someone who is egotistical.  Egotistical is not a personality trait that is attractive. Being ego driven is a trait that lets clients know with certainty that you’re an individual who is determined to succeed and one who has enthusiasm and confidence in what they are selling. Ego drive is the motor inside every great sales person.

Customer Service Focused – No longer can a sales person take the attitude of ‘sell them and leave them’. The entire world is connected 24 hours a day, and this ease of access to information has given rise to an abundance of customer service ranking websites.  If you mishandle a client, there is a very good chance they won’t just tell their close friends, they may also tell everyone on the Internet.

Resilience – Sales is one of the top earning professions in the world.  The rewards are great, but many enter the sales profession with great hope, only to find out that you hear a lot of no’s. Resilience is the ability to overcome obstacles for a long period of time to achieve a big goal. The top performers have developed the grit necessary to keep going past the no’s and start again with the same enthusiasm on display for each client meeting.

Seek Knowledge – People fall into two different decision making styles. They either make decisions first, and then seek affirmations, or they seek knowledge and expertise and then make a decision. If you want to break out of the decision making that has led you to fall short of your sales goals, you have to be in the latter of these two decision making styles. The people who are thriving in sales are always seeking knowledge to become better.

Process Driven – Successful companies all have a process for maximizing business systems and capabilities. The same is true of top sales people. They are process driven and build a sales process for attracting new clients.  They take each candidate through the same process that mirrors their client’s decision making cycle. What can be repeated, can be improved.

Adaptable – Successful sales people are able to work in the present and have a plan to get better tomorrow. They have managed to navigate the ever-changing business climate by acquiring the skills that allow them to adapt and grow. It’s not good enough to say you had a decent sales meeting, the top sales people document what went well and what could be improved upon after each client meeting.

No one is born having all of these traits, great sales people work to create them. Which of these traits do you have to work on to reach the top of your profession?

All the best!

Peter

Why Most Businesses and Individuals Don’t Reach Their New Year Goals

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As the New Year begins, there is never a shortage of newly developed business plans and individual resolutions that are built and created.  Each time I go online, a new social media post or article will pop up addressing the importance of goal setting, offering motivating tips and techniques on setting goals for your business, career or personal life.  In a recent google search I conducted for the term ‘goal setting’, the search produced 15.9 million results!  There is definitely not a shortage of information on how to set goals and build plans.  What there is a shortage of, is people and enterprises that actually reach their goals.

It’s not setting goals, building business plans or creating New Year’s resolutions that are the problem, it’s knowing what the real obstacles are that you are going to have to overcome that keeps people from achieving the results they desire.  Whether you are setting S.M.A.R.T. goals (Specific, Measurable, Achievable, Realistic, Time-Based) or B.H.A.G. (Big Hairy Audacious Goals), if you do not know what hurdles you will be encountering you won’t know the proper steps  to take to leap over them. You can do a lot of things right with regards to staying positive, taking care of your health, visualizing your success, having an accountability partner and still end up short of reaching your goals. Without conducting the proper research of the obstacles you will encounter during your journey, you will become either discouraged or unprepared to reach your desired outcome or win against your competition when you reach the difficult part of executing your plan.

It’s not only important to know what to do to reach your goals, it is equally important to know what the real obstacles will be to reach your goals that far too often are overlooked.  Not understanding the difficulties of achieving a worthwhile goal leads people to underestimate what actions are required to accomplish their goals. Most people have no challenges with dreaming big, they are challenged with understanding how much work is needed to overcome the unidentified obstacles they will encounter along their journey. However, you can overcome this universal goal setting deficiency with proper research that identifies the obstacles ahead of you and gives you insight on actions to take to overcome those challenges.

Through research you find out who and what you are competing against. What is the result that matters and what relevant skills will you need to develop to achieve the goal. It does not matter whether it is for advancing your career, launching a new business, or losing weight; proper research is the first step to get you on the right path to success to reach your goal. Research also helps you identify the pitfalls to avoid. It allows you to know what has been done before, and what the needs, rewards, trends, and new developments are. You can also discern what to learn and what to avoid. Good planning is a component of research. Sounds simple enough, but how much time do we spend researching and planning versus just having a plan. A plan and planning are two distinctly different items. Research is a part of planning that educates and provides you an organized format for both the goals you want to achieve and identifies the obstacles you will encounter along the way.

Napoleon Hill, in his bestselling book, Think and Grow Rich, wrote, “Anybody can wish for riches, and most people do, but only a few know that a definite plan, plus a burning desire for wealth, are the only dependable means of accumulating wealth.” It is human nature to want better, but why do so many people get off track? Just because you wish it, just because you want it, just because you think it doesn’t mean you will get it. You need to have a definitive process to follow that allows you to get to where you want to go.  That process includes setting goals, developing action plans and properly identifying the real obstacles you will have to overcome during the course of the year.

It’s a new year, and instead of just following the advice and expert opinions on how to set goals, positon yourself for a breakthrough year and also take the time to learn what key obstacles you will have to overcome to reach your annual goal.  In order for you to accomplish something significant in 2017, it will require a lot of work.  In fact, it will most likely take more effort than you realize.

What strategies, resources, time commitment and skills will be required for you to have the transformational year you have outlined in your annual plan?

Peter

How the Three C’s of Selling Will Boost Your Income

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The sales profession is one of the largest occupational groups in the United States. It is estimated that over 15 million people work in sales related jobs.  In the real estate industry there are currently over 1.2 million Realtors. Across all industries, sales is a very competitive occupation, and one that allows the top performers to be highly compensated.

Being in sales is very similar to running your own business and in commission based sales occupations, such as working as a real estate agent, you are in-fact running your own business.  In any entrepreneurial role you must have daily habits that will ensure you manage your time effectively.  Moving past the general sales training that is made available to all individuals in a selling occupation, there are certain skills that top performers have developed that have made them excel. Here are the three “C’s” that are not taught in sales training courses and make up the intrinsic skills that separate the top 5% of sales performers from their counterparts.

Caring – All successful sales people have come to understand that they should listen to their potential clients more and speak less when they are meeting with them.  This becomes the formula for any successful sales person in both Business to Business sales and Business to Consumer sales. It is the basis for being a highly paid advisor as opposed to a sales rep. Not only do the top sales people ask more questions of their potential clients, they listen better.  Their listening skills are superior to others who just hear but don’t really understand the needs of their buyers. The top sales people have empathy for their potential clients and are able to understand the buyer’s problems or their unmet goals.  They relate to their feelings in a way that allows them to become trusted with helping the buyer reach a new level of satisfaction by guiding them to solve their problems with the solutions they have to offer.

Candor – A top sales person will focus initially on the buyers needs and not on the services they are offering. When the buyer realizes the seller cares about their problems and why those problems matter, the sales person becomes a trusted advisor.  A trusted advisor, in comparison to someone who is just selling a product, earns the right to be straight forward and honest with the potential buyer. Top sales professionals not only ask more questions than their counterparts, they also ask better questions. More developed questions stimulate thought by the buyer of what their unmet needs or desires truly are. The top sales pros do not worry about losing rapport with a buyer, as they have established trust. When you care about your profession and develop a trusted relationship with your buyer, the ability to ask them difficult questions about why they are doing things in a certain way is earned. This honest dialogue is respected by the buyer.  The odds that the buyer will choose your services or product over a competitors greatly favors the sales person who has the ability to have candid conversations with potential buyers.

Competence – Most sales professionals know how their products or services function and how they can fit a buyer’s needs.  The difference between top sales people and others is the top performers know how their services or products solve the specific problems of the buyer they are working with today. Top sales people are not generalists, they are experts in their field. This means they know more about the future of an individual buyer’s business or investments than their client does. In order to gain this expertise, the top sales professionals spend the time necessary to study their industry and work on developing their own personal skills. This gives them more experience, which allows the top sales person to express that knowledge using a question based methodology, therefore putting the buyer’s needs at the forefront.

To boost your income and separate yourself from your competition, it is not enough to commit to only completing your company’s standard sales training or your industries continuing education requirements. The key to long lasting sales success is mastering the three C’s of selling. Be certain to commit yourself to continued learning opportunities. To learn more about boosting your income in real estate to a new level, join us at the 2017 Unitedpalooza.

All the best!

Peter

Five Basic Feng Shui Tips to Apply Today

Does your home promote health, wealth and happiness?

Does your home promote health, wealth and happiness?

Feng Shui has been used for almost 3,000 years to balance the energy of spaces. To truly practice the art of Feng Shui it takes time, effort and much study. Luckily there are some simple tasks you can put into practice right away.

If you’re looking for ways to make your home more comfortable and enjoyable, take a lesson from this ancient practice to promote positive energy in your home and create an inviting space for potential buyers.

Clear the Clutter

According to Feng Shui experts, clutter blocks the flow of energy in your home and can even negatively influence your life. Begin the clearing process by moving through your house one room at a time. Set a time limit for yourself and gradually increase the amount of time you spend clearing the clutter in each space.

Fix Squeaks

This one seems like a no brainer, but many people become accustomed to the squeaks in their home and simply stop hearing them. The most important squeak to fix is the front door, as a squeaky door will promote bad energy coming and going from the house. To encourage positive energy, simply oil the door hinge and enjoy the sound of a squeak free door.

Consider Your Bed’s Position

We spend almost half of our lives sleeping, so it’s important to make sure your bed is in what’s called “commanding position.” This allows you to have protective energy behind you while you’re sleeping and maintain strong energy. Make sure your bed is as far away from the door as possible and is not directly aligned with the door. You should have a good view of the door as well.

Clean Your Windows

In Feng Shui, windows symbolize your eyes to the world. They allow you to see what’s going on outside and let the light in to our space.  To make sure your vision is clear, clean windows regularly to brighten your space and let positive energy in.

Focus on Air & Light Quality

Good Feng Shui energy calls for quality air and light. Be sure to open the windows as much as you can and invest in indoor plants to keep air fresher. Let in natural light often and ensure you have adequate lighting for your home.

Follow these simple steps and you’ll be on your way to creating balance and positive energy flow in your home.

If you want to focus your energy on selling your home and are looking for expert advice, please contact our team at 855-441-6288.

Sources:

http://fengshui.about.com/

http://inhabitat.com/9-simple-tips-to-feng-shui-your-home/