New Record # of Realtors – What Does It Mean? Plus LeadingRE Holds In Person Event

Hi everybody. And welcome to brokerage insider the podcast where we interviewed the leaders in real estate and technology this week, we are doing again, sign at the times. We got some great feedback on it last week about chit-chatting about the news that happened this week. And our take on it. And so we thought we would keep doing this. But it is a holiday weekend Brits and my guess is live watching on Facebook right now. We've got all of four people probably that are gonna be watching this. So hopefully we get more people watching it on the the recast or on the replay of it. And of course you can always download. This episode via our podcast as well, but Britt. Wow. What a crazy week it's been this week, right? Big week. Gearing up for a, for a long weekend. Never bad going into a three-day weekend. We've got a little bit of rain expecting here in Denver. That's about it, but you've kind of had a bigger week from what I understand. You just got back from somewhere, Eric, where have you been? It was the first. In person event since the same event, what happened shear that is the leading real estate companies of the world annual conference. Travis is a sponsor, a have, was a sponsor of that event. We're also a leading our solutions group member. But man, I was out there for a few days this week. I will tell you, it was my first time also getting on a plane and coming from somebody who. Did 75,000 all domestic miles in 2019, going to 10,000 all done between January and February, essentially last year. And then, and then not having an event. I got to say I was out of practice. And, and this was, I think this was the commentary amongst lots of the folks that were there that are regulars to th to this scene is everybody's like, oh man, I, I I forgot my chapstick. It's dry in Vegas or, or. I forgot this. I forgot that. You know, oh man, I totally forgot that the conference center at the Wynn hotel is two miles away from the hotel. And I had a few folks a few ladies mentioned that they forgot to bring their flats with them. We're doing that two mile walk back and forth to the, to the conference. So yeah, it was, it was great to see everybody back in person though. Great to see a lot of our leading or re clients. And to get a chance to chat with them. Great. To talk to some of our integration partners that were out there. Yeah, it was just, it was, it was great to see people again. Shake hands with people, again, hug people again. And, and leading our reshare did it, right. They they allowed people to select whether they had been vaccinated, whether they were comfortable shaking hands or not, and everybody's badges, it was green, red, or yellow. Based upon what your comfort level with, with shaking hands with people were, or, you know, getting near or being socially distanced from people. And I'll tell you Britt. I was shocked. I think I saw only about 10 people. That didn't have green on their badges out of about 400, I'd say 400 people that were there. Everybody else was green, so it was great to see that everybody's is getting back. They got vaccinated. They're ready to, to connect up and have that in-person engagement again, gonna say, you know vaccination. And I'm not saying we can ever really put this behind us, but let's talk about the conference. Like, what was the content like? Was it. W, I mean, we're people, I mean, we've got speakers who I think have just been dying to get back into that arena and share what was the, what was the content like? What was the kind of the general message of leading already this year? I think, you know, the general message is, was we're back. You know, if you're the first event back, you kind of get to go and make that your, your entire process. But yeah, I think it was, Hey, real estate was strong and, and let's get a chance to build on that network. Leading a re has. It has a great network of brokers all around the world. They actually have an event already planned that they're going to do in Dubai. Later on this year to give you an idea of how, how spread out that their network is. But yeah, I think it was a lot about just like, let's bring people back together. Let's celebrate the crazy year. That was let's celebrate the brokers that are here. The vast majority of them, which had epic years, I heard, you know, up 30% up 20%. And these are brokers that do tons of business already and still had an epic year. So I think that was the, the overall gist. Of the event is let's get everybody back together again. And from there, there was you know, th th the difference of, of content that I heard was mostly around there was, you know, how do you handle learnings from the past year? Right? Like this broker did this in this crisis. And this broker did that too, to work on the business, instead of in the business, they worked on. Workflows and, and streamlining that entire process of how they do things and figuring out where that they had, you know, extra folks maybe, and were able to repurpose them to other parts of the business by, by streamlining their, their transactional workflows. So that's pretty much what I heard from a content perspective. But I think it was really, you know, I think everybody was just really happy to just get together. And go have a glass of wine together. I will tell you, it was probably 95 degrees outside and the expo was outside which was a new one this year. I'll tell ya. And when I first got there, I thought to myself, oh no, nobody's going to show up. It's 95 in Vegas in may. And nobody's, nobody's going to show up here. But sure enough, you know, they came out in droves and, and I think nearly everybody came out that was there at the event, came up to the expo and, and just wanted to say hi to, to vendors and, and to, to friends and, and came out and got their free beverage or two. Right. So celebrate that interaction. Yeah. And you had said something, you know, a lot of these brokers who had these record years last year. Right. And I think that that has been advertised. I think, you know, we've talked about, about that. And every publication has talked about real estate being this guiding light, which I think goes straight into this first headline that I wanted to talk with you about about NAR membership increasing last year and the, this, this housing market that is dominating every single news cycle. In a good way for the brokers in a bad way for the, for the competitive buyers, but you know, all in all boosting that in our membership and getting people are paying attention to real estate, be that because it's, you know, obviously in the news cycle so much I think there's television shows that are, you know, obviously fueling this popularity, but yeah. I mean, what do you think it is that that drives people to. To want to get into real estate at these very polarizing times, like what, what is that? What, what is, what is feeding that. So, I mean, a everybody saw, Hey, real estate is I think the biggest drivers I looked at real estate last year and everybody saw, well, wait a minute. Every other industry has this problem, this problem, this problem, but real estate's the standout. I mean, it was the news story for how long of how good the real estate market was doing. Right. And so I think anytime that happens, but by nature of this industry, you're going to find people that jump in and, and try to take advantage of, of making, making some faster money being that it's, you know, supposedly easy to get into real estate and start selling it. But I think too is I think, you know, folks that were planning on getting out. And retiring last year, my guess is that they probably didn't. And so, you know, from, from a, from a perspective of, of NAR and how it works is, you know, there's, there's people that come in, but there's lots of people that go out every year. Two. And I think the biggest thing that happened is we just didn't see a lot of those retirements. And I think those folks are, are making hay while the sun shining. I, this is, I think that's the fourth time I've said that this week. But I think that's exactly what the, what the situation is, is I think folks that might've otherwise planned on getting out of the business said, wait a minute, I'll work one more year or maybe two more years. And and see how it goes. So I think NAR came out yesterday. I haven't had a chance to look cause I was on a plane but NPR came out yesterday with the member profile. And so it'll be interesting to see what the average age was and see if my, my hypothesis there is correct, but I don't know. I mean, you've talked to more agents and brokers on a daily basis than I do sometimes. So have you heard or, or seen anything like this with. With them recruiting new folks to the business. I think not so much with recruiting, but you know, I've talked to a lot of our new agents and I feel like. A lot of, a lot of the people that we are working with are very new to this industry. And I'm just going to jump back to something you said that seems to be a common theme. So many of the people that we've talked to on this podcast have said that, but what you just said, you said it's easy to get into real estate and start selling. The thing about that statement is I think 50% is correct. It's easy to get into real estate. It's that start selling part where. Everyone is encountering problems right now. Right? The thing that I think about is like, with all of these more agents or potential agents or prospects they want to get into this industry, there's less inventory than there has ever been, which means there's even more agents fighting over less opportunities, just increasing that competition and making it that much harder. So, whereas I think this is great for NAR and in love industry and the industry, you know, building, I also. You know, look at a lot of these agents who've been in for 25 years and, you know, there's, they're seeing more competition come in and at an even tighter market. And so I just wonder what they're kind of going through and what they think of this. You know, th this influx suddenly. So either way I, you know, so let's, hopefully we get some comments on here on, on our Facebook live or you know, shoot, shoot us a message. But, but yeah, I mean, I, I hear a lot of the same thing. It's tough. I mean, we're I'm going to be having dinner with our realtor friend of mine tonight. And I know for a fact, she had one client that they wrote 11 offers on 11 different properties and folks, they were not writing offers for under a listing, a listing price. They were all over listing price and not one of them got accepted. And that actually probably leads a little bit into our next topic to talk about, which is. 51% of all transactions that closed in may, according to Redfin, 51% closed above asking price which sets an absolute new record, a high new record. That's there. So 51% of all homes sold in may. Went above asking price was just, just crazy to me as a negotiator. I, I'm not sure I could ever pay over asking price for something. I mean, what is that? I don't even know how to fathom that. Right? Like, I mean, you, you list your home and then at a number that you want to get, I assume like agents or. You know, they're thinking about their commissions. They're thinking about the business. They're thinking about the neighborhood, the value, the whole market. And it kind of seems like they know that whatever they're going to listen to, that it's going to go for over asking. And maybe even without an appraisal. Which is so mind blowing to me to think about when you're making that investment. I mean, how can you even guide, how are you recommending to somebody to pay for a home that's worth more or pay more for a home that it's worth? While your obligation is to get them the best deal possible. I mean, it's just, it seems so many contradicting factors there. You have to go into that, believing that the market's going to continue to do what it's doing. And I will say, like, I think we've seen markets like this before, but nothing. I mean, oh, oh five oh six, but nothing is crazy as this where it's. You know, it's not $5,000 over list price. It's $50,000 over list price. Right? I, in one of the Facebook groups and the lab coat agents group, I saw somebody talking about how every single home that they were putting offers on the listing agent would call and say, by the way, you know, just plan that you're, if you're going to make an offer at needs. For more, at least a hundred thousand over asking price. Is this, it's just crazy to me to even think about as a, as a guy who, when I sold real estate 20 something years ago, my average price, when I first started selling real estate was $117,000. And the last year I sold real estate before I really became a broker. I represented investors and my average price was $62,000. Although we sold a hundred and something homes it was still $62,000. And thinking about this where the, these, the offers are a hundred thousand dollars over asking price. It's just, it's crazy to me, but I get it. I see the demand and the remember the value of housing and the value of anything out there every single day. It's always just based on demand, right? So if there's enough people that want something and there's a light supply of it, they're going to go up in price, same things going on in the car industry. I don't know if you've seen this Britt, but in the used car industry prices of used cars. You could buy a car last year and sell it this year with five or 10,000 miles on it for more money than you bought it for last year. Because there's such a demand for used cars and there's just no use cars and then new cars, they're not making them enough. Enough of them fast enough one cause of the pandemic last year, but two, I don't know if you've heard, there's a chips shortage and now every car, you know, has multiple computer systems inside of it. And they four just shut down this past week. One of their plants because they didn't have chips to finish out any of the cars. So they said, Hey, we're just going to stop production for awhile. So yeah, it's, it's crazy. It's, it's all about supply and demand. And there's a lot of people looking to upgrade. They're houses right now. There's a lot of folks that the bigger one to me, that I'm always surprised by is what percentage of transactions are cash transactions, full cash transactions? Not I waived my appraisal, but, but I came to closing with a half a million dollars. I'm always shocked by. What percentage of the population by, you know, can has enough money sitting in their bank account somewhere to go and buy multimillion dollar houses completely free. Gosh, I mean, I can't speak too, too much to that. In the sense I've read some articles about it, but one of the things I saw is, you know, because of the, what was happening with the stock market last year, there are a lot more cash buyers. Who are, you know, who, who were in that position? On top of that, you've also got, you know, are the I buyers of the world out there who are gobbling homes up left and right. You know, we've talked a little bit about that. Just where I think that's a great entree to our next topic too. Right. Right. What is that? Which is Mr. Dell? Yeah going in and getting a gig. Right. So if you guys don't know if our listeners don't know, there's a a guy that, I mean, he, if you want to know about IB buyers, Mike, Is the authority. And I mean, it is the singular, he is the singular authority. If it is something to know about any brokerage tech forward brokerage, who, you know, the, some of these brokerages that, that are out there, like compass that, that really pushed this concept of being, Hey, we're a tech company. We're not a brokerage or an I buyer. Or a portal, Mike knows everything there is to know about these guys reads all of their financial statements, knows how all of their businesses work comes up with charts and graphs and everything like that can tell you exactly how much money they all lose per house that they buy. On all of this Mike's that guy. And I mean, he just knows his stuff backwards, forwards. I've seen him speak a few times. He's just, just excellent and puts out some really great white papers on all of this stuff. But, but this week Mike went to and I buy her. You might got a, a gig at an buyer. Tell us a little bit more about that. I'm not sure if homework are they necessarily an ad buyer. Are they helping. They're helping buyers make all cash offers. So I think that's, you know, that that might be the, that gray area in there, which is where I think, you know, his ability and his understanding and his deep knowledge of the industry is going to be really beneficial. And I, and I'll also say like one of the things that I really love about. Yeah, everything that he's writing and everything that he puts out is he breaks it down into like sub layman's terms. Right. He makes I buying very consumable for, for the layman. And I think that's really important because. The the Zillows the, the open doors, you know, they are, they seem like these, these giant behemoth, but their business models are, you know, very easily understandable. I think, you know, thank you. Thanks to Mike. And what he's doing out there, Homer, and I don't really know as much about it. I did see that they just raised, I think yeah, 300 million, right. Pardon? I said $300 million all over. Yeah, I think three 70. And so, and I saw him, you know, Mike posted about it on LinkedIn about being an advisor there. And I think that is, you know, what a, what a great opportunity for homework to, to get the most forward thinking person in the industry in it. So kudos to kudos to Mike and excited to see what homework is going to do moving forward as we kind of follow and track that story. Right. And, and, and I think what they're trying to do is what for those of our listeners that tuned in last week, we had on open door they're a director of brokerage strategy and growth, a friend of mine, Tyler Hickson, and, you know, they launched early this year, they launched the cash buyer program too. And the whole idea was that you could go buy something with a cash back offer. And then their mortgage company would finance you. And if they couldn't you could stay in the house for awhile, for whatever reason, if something happened and you lost your job or, or, or something else happens that you could stay in the house for awhile. And then. Then, you know, you might have to vacate, but you would at least get into the house. If they approved you. And then in the meantime, you could sell your home to open door, but the idea was that they were getting you to use their ancillary services, which is where they were making up money. Right? So they, they make money on the mortgage. They make money on the cash backed off, or they make money. On the title service, if you use a open-door title. And I think that's the direction from what homered is going is that you can, you can make this cash back offer that that's kind of inside of the brokerage and and allows them to You know, make a better, stronger offer, essentially that the question mark, that I'd have for Mike, if he ever had five minutes, you know, he's a, he's a crazy busy guy. And I hope we can get him on the show sometime, but it seems like every time we try to try to get him on, he's got 47 things that he's already committed to for the month. But I'd love to get Mike on it and ask him about a few different things. But one of them is in a market like we're in today where there's cash backed offers. Going back to our last topic. How does the cashback offer working with the in-house mortgage? How do they support the concept of, Hey, the home. Went under contract for 50 grand more than, than what it was listed for. And then the appraisal might come in low. Like what happens in those circumstances? I'm sure they have something in their language that says, Hey, we'll only support this up to an appraisal price. It has to be right. I guess who knows? I mean, you're going to miss out on. 51% of the homes, if that's the case, you know, remembered just because it goes over asking price doesn't mean it won't appraise. Right. And, and funny enough at my dinner that I'm going to tonight and Hey, maybe I can get him to come on. The show. Appraisers are notorious for not wanting to get onto podcasts and on zoom calls and video calls and things like that. But I'm actually also going to be a dinner tonight. All the vaccinated, everything like that. So don't worry for those listeners. You know, I've, I've got my car, trust me. I carried it everywhere around with me in Vegas. Proudly to show that it was safe to shake my hand if, if, if folks felt comfortable doing so. But I'm going to have dinner with an appraiser tonight too. And he's done some high percentage of the pre-sales. His appraiser firm has done a high percentage of appraisals down here. And so I'm going to ask him a couple of questions about that. And if everybody has a good idea for a question, feel free to put it into the chat and I can, I can bring it up to him. And maybe I, after I get a glass of wine of wine or two into him, I'll, I'll get some real facts and figures on, on how this science and art of appraisal appraisals works. But, but going on that point, something we should talk to him or somebody else about sometime is there's a lack of appraisers, right? There's there's not enough appraisers for all the appraisal work. One of the things that I'm hearing is. It's taking a month to get an appraisal time and they're starting to charge 700 800 900 bucks for an appraisal. Which seems crazy to me for, for appraisals usually. Yeah. In back in the day and I'm from St. Louis. But back in the day, there were two, 200 bucks, 300 bucks. Right. Now we're talking to thousands closing in on a thousand dollars for appraisal because there's so much demand and there's not enough people that have appraisals, but to round out the topic. Cause I know we're out of time here going into a holiday weekend to round out the show. We talked a little bit about the number of members coming into NAR, and if you're a frequent listener of the show, you know, that all every single CEO that has been on the show of any brokerage out there when we asked them the question that we ask, all of my guests on the show is. If you could change one thing about real estate, what would it be? And every single one of them said, make it harder to get into real estate. And I, my take on it is a little bit different. And, and so just to close out the show here, I actually believe in the appraiser model for doing this right. We have, they don't have enough. We have a whole bunch of realtors to think about this folks. One in 250 people in this country. Total people not just working aged people. Total people is a realtor, not a real estate agent, a realtor. Right? If you go to realtor, if you go to real estate agent, you're talking more like one in every 200 to one in every 180 people in this country. Are a real estate agent. Right? So imagine, and that this concept that I've pushed for 15 years in this industry, and we're going to do a summit about this later on this year, sponsored by Travis. But what we're going to do is get the get CEO's and things like that together. But my take on it. Is, I think we need just like the appraisal world, an apprenticeship program. So you know, bread, I don't know if you know this, but to become an appraiser, you have to do a number of appraisal appraisals as a junior appraiser, underneath a senior appraiser. And that person is responsible for you has to sign off that you've done a good job on the appraisal and their name. And your name are both on the appraisal together. So T they have responsibility that's in there too. Obviously, they collect a portion of the fee for being the responsible party, but then that junior person gets the training and the apprenticeship. They need to know how to do a really good job. And then they can go off and do their own thing or work as a Jew, you know, work underneath this, this more senior level person down the road, or however they want to do it. So to me, I don't understand why if I'm out of real skate school on day one, I should, how can I possibly represent somebody well on a transaction? Right. So my take is let's, let's take the appraisal model where you've got to do 50, 75, a hundred, a hundred appraisals underneath somebody else. And then you can, you can decide to go out on your own. I think that'll be a great point to bring up when we finally do have this summit. I also know based on all of the guests that we've had. That summit panel is probably going to be pretty big. I'm talking like a full round table will be a great representation of of how many real estate agents and realtors there are in this country. We're going to need as much representation as possible. But like you said, Eric, we're, we're going into a holiday weekend. Why don't you take us out? Let's let's get to it. Well everybody have a great Memorial day weekend. Don't forget that what the holiday is for. I'm always really big on, on taking a moment and always remembering what each holiday is for and what it stands for. And so it being Memorial day weekend, you know what we're what the, the, the point of the holiday is, is, is we're honoring those that have passed. Protecting our freedom. Right. And so, you know, take a moment, remember those in your life or, you know, grandparents, parents, kids, unfortunately, everything like that. Remember those that have, have died for our sacrificed and let's honor that sacrifice every single day of our lives exert with that said have a wonderful Memorial day weekend, and everybody out there look forward to talking to them, seeing y'all soon. Bye guys.