Let me tell you, I have been in the real estate market 21 years, and I've sold over 2,300 homes. And the industry is never going to be the same again. There are so many things that are happening right now, and because of the pandemic in particular, that will change the industry forever.
Move to Digital
For example, people aren't going to open houses anymore. In my opinion, they didn't really work anyway. Open houses are for the realtors, they're not really for the seller. Buyers know more about the house than their agent helping them find the house, because when you're looking for a house, you're so excited and do your research. So open houses will be less popular, and if they need to be, you can do a virtual online open house.
Another thing that the pandemic will change forever is brokers' tours. Same thing, though. The brokers' tour was really only good for the agents. That's when you're calling your friends, saying, “Could you show up to my house? I have brokers' tour. I want to make sure there's a lot of cars there.” This is because you want the seller to think you did a good job. I've always told sellers, they don't work, just like open houses don't. There are far more innovative ways to sell real estate. And that's how I've been practicing real estate for many, many years. Heavily online and heavily digital.
Nobody wants to go into the office. That's why brokerages like EXP are exploding, they operate online. They set it up that way even before the pandemic. But now especially, it works for so many people. They’re able to talk to their broker, seek accounting help, have meetings, attend training and so much more without ever leaving home.
It's Time to Be Different
The pandemic is forcing agents to get on their A game. It's forcing agents to start utilizing digital marketing, social media, and video. It's forcing all agents to ditch the old school tactics (like we did years ago). In fact, I'm a master of the digital market. But most agents just have not learned or taught themselves how to market online. The national association of realtors says 98% of buyers start their home search online, they go there first.
The National Association of Realtors also shows that 67% of buyers will walk through a home that they see online. And now finally people are actually learning or trying to figure out how to master the art of digital marketing and social media to get their homes more exposure. In fact, The National Association of Realtors that showed that the average top 30% of agents actually made more in 2020. The bottom tier actually made less. They are anticipating in 2022 the average realtor will sell less than two transactions. So if you take all the homes that are being sold and the amount of realtors that are going into the market with the inventory that we have, the average agent is going to sell under two homes a year.
The real estate industry is extremely over-saturated. There are over 1.5 million realtors and two million agents that aren't part of The National Association of Realtors. However, you should be careful to never ever list with an agent that doesn't sell at least 25 to 35 homes a year. I have sold over 100 homes a year, every single year, and I will tell you, you learn something from every single transaction. I've made mistakes, even after selling 500 homes, 600 homes. You learn things. Also when you're selling a lot of real estate, you can predict what's happening in the market. Or you can tell things are kind of starting to shift, and you can educate your seller and your buyers about what's happening.
Since CDC guidelines recommend sanitation, masks, distance and lower capacities, we are being more cautious of who is allowed in what people can do when they’re in these homes. This will continue after the fear of the pandemic has passed, because it’s never a bad idea to think about who is coming into a home. Are they really qualified? Have they gone through the entire desktop underwritten approval process? They should be sanitizing, taking their shoes off or wearing covers, and not touching a lot of things. These precautions should always stay in place.
People are going to have to become more digital, the pandemic has shown that this is the more efficient way to operate anyway.
New Normal Real Estate Market
Another thing that we would anticipate that because of the pandemic, the real estate market was going to crash. In 2021, there were more homes sold than any other year in history. Even though it doesn't seem like that because of the lack of inventory and the high amount of buyers. The reason why is that we are not building a lot of new homes and the population is growing, far surpassing the numbers, so we still have limited inventory.
So you're seeing these fluxes of inventory entering the real estate market. For example, a lot of elderly people did not want to list their homes, so they were holding off. But a lot of younger people were still entering the market because the interest rates were so low. Those kinds of influxes are going to kind of affect what happens a year from now. Eventually people that want to sell are going to have to sell if they've been holding off. Eventually people that wanted to buy but held off, they're going to start buying.
Hopefully the real estate market is going to continue to go up. And in fact, I think they predicted around 6% that we were going to increase in 2021. We had around a 23% increase. So the experts were quite off. They're anticipating that we are going to have a 4 to 6% increase this year. Let's just hope it's a lot more just like that they're wrong like they were wrong last year.
