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Traditional Real Estate and the ‘New Normal’

This month’s National Association of REALTORS® (NAR) Power Broker Roundtable discusses the evolution of the industry’s “new normal.”

Moderator

Pappas_Christina_60x60Christina Pappas, District Sales Manager, The Keyes Company, Miami, Fla.; Liaison for Large Firms & Industry Relations, NAR

Panelists

Chris_Sherry_60x60Sherry Chris, CEO, Better Homes and Gardens Real Estate, Madison, N.J.

 

Docktor_Joan_60x60Joan Docktor, President, Berkshire Hathaway HomeServices Fox & Roach, REALTORS®, Devon, Pa.

Doan_Long_60x60Long Doan, CEO, Co-Founder, Realty Group MN, Coon Rapids, Minn.

 

Christina Pappas: Everything old is new again. The saying comes from the lyrics of a Peter Allen song originated nearly 40 years ago, but the words were never truer than they are today, especially in the real estate industry, which has changed and reinvented itself over and over since the term “REALTOR®” was first coined way back in 1916.

So what exactly is traditional real estate? Is it relevant in today’s world? What do we mean by “the new normal”—and where is the industry heading? For answers—and some very well-informed interpretations—we’ll be speaking with three industry leaders who are positioned on the forefront of change. Sherry, you’ve been a real estate innovator through several cycles of change. What do you see as today’s new normal?

Sherry Chris: Well, I can’t go back to 1916, but I have been around long enough to see how the industry has turned upside down with the advent of modern technology. In the early days of technology application, consumers would search our websites on their own and perhaps eventually call an agent. Today, we can give our agents the edge through the use of predictive modeling. We can use Smart Bots. We can match up artificial intelligence (AI) with a treasure trove of deep, rich data to determine the habits and patterns of potential buyers and sellers, so that the agent can be the first to reach out with exactly what that consumer is looking for. That’s the direction we are taking, and we’re investing heavily in the effort. But to speak to your “everything old is new again” reference, Christina, the truth is that regardless of the impact technology is making, the agent was, is, and should be the trusted advisor at the center of every transaction.

Joan Docktor: I agree. Today’s new normal combines the best of traditional real estate—that is, building relationships and giving every consumer the best possible buying or selling experience—with everything that technology can offer to accommodate and advance those goals. We are using AI to make our agent CRMs smarter—to give our agents more and better information and to keep them front and center with consumers. We’re also in the process of developing Chat Bots, or Smart Bots, to reside online and answer consumer questions 24/7—and, more important, to connect online searchers with knowledgeable, live agents.

Long Doan: Of course, technology has dramatically changed the way real estate is practiced today, but that’s only one piece of the puzzle. In my new normal, keeping the agent front and center means more than providing tools; it means creating an environment where the broker works for the agent, and not the other way around. Our goal is to provide a business platform that includes technology, as well as marketing support and coaching, to help every agent become the CEO of his or her own business—and we are turning the traditional commission structure on its ear with a 100 percent commission and a flat fee. In my view, that’s the way to produce dedicated and competitive agents who perform at peak levels.

CP: There’s another way the industry is changing, and it has to do with physical footprint, both in terms of space and layout. Shrinking office space was a natural byproduct of the last industry slowdown, but what may have begun as an economic need is giving us a new-normal benefit. In our offices, for example, cubicles are becoming a thing of the past in favor of open spaces—almost like a Starbucks atmosphere—that are flexible and that definitely create a more congenial business setting.

LD: I think that back when cell phones went viral, and everybody became mobile, many agents seemed to want to skip the office in favor of working from home. But now, agents are coming back because they miss that interaction. Part of my approach is making the office environment so valuable, so compelling in terms of support, sharing and mentoring, that agents want to be there whenever they’re not out selling real estate.

JD: That’s a good thing, because real estate is first and foremost a people business, both in terms of office culture and in building client relationships. But as more business is transacted online, the new normal also means we need to be more focused than ever on security. Hackers become more wily every day, and many consumers don’t realize just how vulnerable they are. As brokers, we need to have two-step email authentications and other online security measures in place to help keep consumer information and all our data as safe and secure as possible.

SC: And yet all of that is in the background, as far as consumers are concerned—security, data-mining, even Smart Bots. All most consumers want to know—even millennials, who are the most tech-savvy and who make up the largest segment of homebuyers today—when the rubber meets the road is that their agent is there for them, face-to-face, throughout every phase of their transaction. In that way, traditional real estate hasn’t changed…and I doubt that it ever will.

For more information, please visit www.nar.realtor.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Traditional Real Estate and the ‘New Normal’ appeared first on RISMedia.

Cryptocurrency, Cyber Fraud Focus of Trump Task Force

On an executive order by President Trump, four agencies established the Task Force on Market Integrity and Consumer Fraud last week, charged with guiding “the investigation and prosecution of cases involving fraud on the government, the financial markets and consumers, including cyber fraud and other fraud targeting the elderly, service members and veterans, and other members of the public,” in addition to other provisions.

With the Consumer Financial Protection Bureau (CFPB), the Department of Justice (DOJ), the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC) involved—and input from officials across sectors—the group will especially focus on cryptocurrency, healthcare fraud, money laundering and tax fraud, according to a government statement. In an effort to improve the investigation/prosecution process, President Trump has asked the group for guidance on how to better cooperate across sectors, as well as for guidance on legislative reform, if necessary.

From abuses by banks to cyber crime, fraud has heavily impacted real estate, with consumer finances largely invested in property. Additionally, while cryptocurrency is new, the implications for the industry are vast.

According to an RISMedia survey, 27 percent of agents and brokers are “not sure” if their brokerage has a cybersecurity policy, and 19 percent have no policy at all. The most common crime is phishing/wire fraud, in which buyers are duped out of their funds.

Led by Deputy Attorney General Rod Rosenstein, the coalition established last week replaces a group formed by President Obama in the aftermath of the financial meltdown.

“Fraud committed by companies and their employees has a devastating impact on American citizens in the financial markets, the healthcare sector and elsewhere,” said Rosenstein in a statement.

“Drawing on our pooled resources, including subject-matter expertise, data repositories and analysts and investigators, we can identify and stop fraud on a wider scale than any one agency acting alone.”

DeVita_Suzanne_60x60Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

The post Cryptocurrency, Cyber Fraud Focus of Trump Task Force appeared first on RISMedia.

Blazing a New Trail: NextHome Achieves Unprecedented Growth

July18_NextHome_Cvr_300x420How does a company break into franchising in 2015 and end up with 290 locations and 2,500-plus agents in 43 states just three-and-a-half years later? According to NextHome CEO James Dwiggins, it’s all about giving real estate professionals what they want: the flexibility to maximize profitability, automated technology solutions, and contemporary branding and marketing to support them in the field. But for Dwiggins, it’s not just about racking up numbers—it’s about helping agents be productive and ensuring an exceptional customer experience. We recently sat down with Dwiggins to find out just how the young brand has grown so quickly, and why he feels it’s changing the franchise business.

Maria Patterson: NextHome launched in January 2015. Tell us your current size and how the company has grown so quickly.
James Dwiggins:
It’s certainly been an exciting time for us. We started franchising in 2015 and as of May 2018, we have over 290 franchised locations and 2,500-plus “NextHomies” across 43 states. In 2017 alone, the company closed over 10,000 transactions worth over $2.5 billion in volume. These are incredible numbers for a three-year-old company.

MP: How do you explain such tremendous growth in such a short amount of time?
JD:
Our growth really has to do with four things. The first is our flexible franchise model where franchisees can choose between a one-year or five-year franchise agreement. This length of agreement has never been available in real estate until we introduced it.

The second is our variable franchise fees. Members can choose to pay us a flat monthly fee or a percentage of their commission. This allows higher-producing agents to save money by paying us a flat amount each month regardless of the number of transactions they close, while lower-producing agents only have to pay us when they close a transaction.

The third reason is our technology platform. Not only is every solution we offer included for every member, but also the product offering provides everything they need to be successful in today’s real estate business. More importantly, it’s completely automated so members can access everything in one location—the data is shared across the entire platform, so there’s no need for duplicate data entry. This is why our technology adoption rate is over 70 percent.

In just 3.5 years, NextHome has expanded to 2,500-plus "NextHomies" across 43 states.

In just 3.5 years, NextHome has expanded to 2,500-plus “NextHomies” across 43 states.

The final reason for our growth is our branding and marketing. The NextHome brand is modern, clean, and designed to attract today’s Gen X and Y homebuyers and sellers. We worked closely with the world’s largest independent design firm, Pentagram, to create a brand that truly resonates with today’s consumer. This combination of products, services, and cost structure has provided an opportunity for small- and medium-sized brokerages to be part of something bigger without the significant upfront or ongoing costs of our competitors. I believe this is why we’ve added so many locations in such a short period of time.

MP: The average NextHome office is much smaller than traditional brokerages. Why is that?
JD:
We believe the future brokerage consists of smaller, highly productive offices. We all know real estate is cyclical, and overhead is the one expense you can control. It’s why we teach our franchise owners to keep it low and steer clear of large office locations. There is simply no reason to have an office with 50 desks where only 10 are being used at any point in time. It’s no secret that brokerages across the country are struggling to maintain profitability, and the ones that are in the black have thin profit margins. This is due to large overhead costs, unproductive agents and downward pressure on commissions from a lack of perceived value proposition by the agents. It’s why NextHome continues to increase our value proposition so our offices can justify the fees they charge for agents to be affiliated with them, and thus, help maintain profitability.

NextHome believes the future of real estate brokerage lies in smaller, more productive offices.

NextHome believes the future of real estate brokerage lies in smaller, more productive offices.

Also, 50 percent of our offices are agent teams who went out on their own to open an office with us, so they’re naturally smaller in size; another 40 percent of our offices are small- to mid-sized independents who join us, and the rest are smaller existing franchisees from a competitor who convert. Unlike our competition, we don’t measure our success by the number of agents we have in the company, but by how much business they do and how profitable they are. We’re confident our members are winning on both of those fronts.

MP: You signed on with a major design firm to help develop the Next-Home brand. Tell us about your collaboration with Pentagram.
JD:
We knew we had to create a modern brand identity, not just another real estate brand lacking intention or emotional connectivity. After studying great brands across the globe, one design firm kept coming up again and again—Pentagram. With offices in London, New York and San Francisco, they’ve created the brand identity for companies like Verizon, Tiffany & Co., and more recently, Mastercard and American Express. When we approached Pentagram to help us build the NextHome brand, they were truly excited to create something entirely different and fresh for our industry.

MP: How did Pentagram help define your branding…and what led to the creation of your mascot, Luke?
JD:
During the creation of our brand identity, we realized that our company name speaks directly to what we do—help people buy or sell their NextHome. It’s a phrase buyers, sellers and agents already use in their daily conversations. “NextHome” represents forward motion and progress, and speaks to the transition buyers or sellers go through.

NextHome's modern brand identity, including mascot Luke, the orange Frenchie, was developed in collaboration with global design firm Pentagram.

NextHome’s modern brand identity, including mascot Luke, the orange Frenchie, was developed in collaboration with global design firm Pentagram.

Another key component of our brand identity was the emotional connection—something consumers can relate to or talk about. That’s how our orange Frenchie mascot “Luke” was born. We wanted to direct the conversation between consumers and our agents toward something positive and fun during this often stressful process. Think of great brands you’re already familiar with—you emotionally connect to their mascot, not their logo. For example, with Geico, you think of the gecko. With Budweiser, you think of the Clydesdales. With Coca Cola, you think of the polar bears. That’s why we use Luke in all our marketing and especially next to our yard signs. He’s the emotional element connecting consumers to our brand, and gets conversations started all across the country.

MP: Companies talk a lot about culture these days, but it’s apparent something very different is going on at NextHome. How would you describe it?
JD:
Family. Collaboration. Standards. Purpose. These are the things that define a “NextHomie.” For us, it’s about helping our agents become more productive and, more importantly, ensuring an exceptional consumer experience when working with our agents.

MP: How do you protect that culture while growing so rapidly?
JD:
To create a family atmosphere, start by not recruiting everyone. It’s about the right people who share the same values and vision of the company. Just because someone closes 75 deals a year, it doesn’t mean they’re a good fit for us. Their values and vision must line up with ours for it to be a win-win. This approach of not bringing everyone into the company has led to collaboration that’s simply not seen in our industry. Because our members are so aligned, they don’t view each other as competitors, but partners working toward the same goal. I’ve truly never seen a group of people more willing to share ideas and best practices with their peers, just to help them succeed.

IMAGE: p. 83 (Align None)
CAPTION: NextHome’s culture of family, collaboration, standards and purpose is maintained by only bringing on the right people with the same values and vision.

MP: How does the company’s collaborative environment benefit the consumer?
JD:
This member collaboration has led to minimum standards our entire company is expected to follow. For NextHomies, it’s about having the most professional brand presence and agents in the marketplace. You simply can’t have that if everyone is doing things differently at varying levels of quality. We hold each other accountable to these high standards, which, in turn, creates a more professional company. It’s become our purpose. If we’re going to remain at the center of the real estate transaction into the future, we must do more for the consumer, listen to their needs, and embrace change. This is the culture of NextHome, and has genuinely become part of our DNA.

MP: What’s your strategy for effectively marketing the firm and best serving the needs of prospects and clients?
JD:
We spend a majority of our time listening to buyer and seller needs. When something is commonly requested by buyers or sellers, we go to the extent of making it a minimum standard across our company. It’s important to us that clients receive the level of marketing and professionalism they deserve. We then make sure our offices and agents have the products and services to fulfill those needs, and we automate the process of creating them so it’s not a burden of cost or time to our members. It has to be easy for our agents so they can focus their time on client relationships and money-generating activities.

For example, we recently rolled out a new marketing automation product for our agents. This new product automatically creates a collection of beautiful marketing pieces for them when a new listing is entered into our system. Our members receive an email containing a single property website, social media posts, flyers and brochures, and postcards for farming, as well as other materials. We also send them new marketing pieces for their open houses, a price reduction, or farming materials after the property is sold. By doing this, we can require these marketing pieces be used on every listing, which raises the level of professionalism in our company, while also not requiring our agents to do any additional work. This is a prime example of how we effectively market the company and serve everyone’s needs.

MP: What’s on deck for the future of NextHome?
JD:
Our primary objective is to continue expanding the franchise into markets we don’t currently serve. We’re expecting to grow to 350-plus locations in all 50 states by year’s end, and our goal in 2019 is 500-plus locations with about 5,000 NextHomies. We’re also planning to expand internationally in 2019 to start our global referral network. We’re very excited to take the brand outside the U.S. We have several more products and services scheduled to launch this year, which will further enhance our technology and marketing platform. And finally, we’re focused on automation and integrating AI into our proprietary CRM system. Our goal is to further automate outreach to prospects and clients for our agents and increase their perceived value proposition and professionalism. These are just a few of the many exciting things on the horizon for NextHome.

For more information, please visit www.nexthome.com.

Patterson_Maria_60x60Maria Patterson is RISMedia’s executive editor. Email her your real estate news ideas at maria@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

The post Blazing a New Trail: NextHome Achieves Unprecedented Growth appeared first on RISMedia.

Michael Rogers: Creating Value for Agents and Clients Alike

Michael_RogersVitals: Dorsey Alston, REALTORS®
Years in Business: 71
Size: 2 offices, 242 licensed REALTORS®
Regions Served: Metro Atlanta
2017 Sales Volume: $837,475,014
2017 Transactions: 1,556
No. 321 in sales volume in RISMedia’s 2018 Power Broker Report
www.dorseyalston.com

Michael Rogers, current president of Dorsey Alston, REALTORS®, started with the firm in the spring of 2000. The thing he loves most about the residential real estate industry is the fact that it touches everyone. He also understands that providing the best counsel to homebuyers is of utmost importance.

A second-generation Rogers and the third Atlanta native to own and run the firm, he’s helped keep the firm a leader in the area over the years.

How is your market faring so far in 2018?
Michael Rogers:
Our market continues to shine. Demand continues to outweigh supply, making it a great time for sellers to enter the market.

What is your growth strategy? Are you planning to grow your firm in the next 12 months?
MR:
Our growth is very organic. While our No. 1 priority is focusing our support on the team we have, we continue to selectively add agents as we’re introduced to or approached by candidates.

What sets your firm apart in the marketplace?
MR:
The focus that we put on our agents is a point of differentiation for us. In fact, no other firm has a unified leadership team whose sole focus is the support of their agents. We’re also selective when it comes to who joins our team. Ethics, character and the resulting culture motivate us more than production. We have a long-term view for this company, and we’re committed to holding true to the principles that have contributed to our 71-year history.

From your viewpoint, what are the biggest challenges the industry is facing?
MR:
In 2016, 235 real estate tech companies received venture capital funding, compared to just 72 in 2012, according to Inc. magazine. In 2017, several of these start-ups entered the Atlanta market to test their models. Some companies are attempting to change the way homes are bought and sold by moving to an online-only model, using complex systems to price homes sight unseen, then buying the homes if they don’t sell for that price. Others are bringing virtual reality and real-time data to the home-buying and -selling experience. All of this is potentially disruptive to the residential real estate business.

How is your company responding?
MR:
It puts pressure on us to continue to hire the best people in the markets we serve, and to help sellers realize the value of working with a professional with the highest ethical standards and with a company that cares deeply about the community. These tech firms are presenting challenges, but they’re also creating an excellent opportunity for us to continue to distinguish ourselves by creating value for our clients and our agents.

What are the biggest opportunities for increasing business right now?
MR:
Millennials are on the cusp of surpassing baby boomers as the nation’s largest living adult generation, according to the U.S. Census Bureau. This is a huge opportunity for Dorsey Alston, REALTORS® and our business. We have more than 30 real estate professionals who fall into the millennial generation, which accounts for more than 10 percent of our agents. We’re focused on not only hiring the top young real estate professionals in the field, but also on giving them the training and support to succeed. With millennials transitioning from renters to homeowners, we’re well-positioned.

How are you updating your technology and training to provide the resources agents need to succeed?
MR:
We’re in a very competitive market where marketing materials and mediums are as important as ever. To that end, we’ve made new hires focused on social media, graphic design and personal marketing support for agents. We’ve also made greater investments in production equipment this year than any other time in our company’s history.

What do people enjoy most about working at your firm?
MR:
We’ve not only created an environment that fosters business success, but we’ve also created a fun working environment and a place that appreciates all the individuals that comprise our team. In addition to our focus on our clients, we also emphasize giving back to the community and building our camaraderie within.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Michael Rogers: Creating Value for Agents and Clients Alike appeared first on RISMedia.

Breaking Down the Hottest Patio Trends This Summer

Summer patio season is ramping up. The experts at Infratec say that outdoor design trends for 2018 are all about incorporating affordable luxury into your own backyard by turning your patio into a peaceful, lush oasis through low-maintenance water fixtures, a color refresh and vintage materials.

The company sees many homeowners gravitating toward easy-maintenance exterior garden designs that enhance physical and mental wellbeing with spa-inspired touches, like meditation benches, fountains, reflecting pools, rock waterfalls and zen gardens.

According to Infratec, low-maintenance water features can add visual interest and soothing sounds to a yard—even in drought-prone climates—because they actually require little water (and recycle the water they do use).

Kate Simmons at Decoist.com says cabana stripes can be found in this year’s collections, and this trend shows no sign of fading. She says that linen, teak and rope are a few of the materials designers are incorporating into exterior furnishings and accessories to give this year’s easy-breezy trend pizazz.

When it comes to outdoor style this year, Simmons says pink is the accent color of choice, especially if a hint of blush is introduced into your furniture vignettes.

Meanwhile, at FamilyHandyman.com, trend watchers are seeing patio furniture that mixes materials, such as metal and wood, instead of a single material, such as wicker.

If you have a covered deck or patio, the site says you can bring it up-to-date by adding a ceiling fan. If you haven’t installed a ceiling fan before, rest easy—you can do it yourself in less than a day, and you’ll be comfortable even on the hottest summer days.

FamilyHandyman.com also says that the days of small, bistro-style dining tables on the deck and patio are over, and that large-scale square and rectangular tables are hot.

As far as accessories are concerned, think bright and bold when it comes to fabrics for your patio furniture cushions in 2018. Go with yellows, reds and pinks that will pop against all that natural greenery, and your guests will be raving about your impeccable sense of style all summer long.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Breaking Down the Hottest Patio Trends This Summer appeared first on RISMedia.

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