How the upcoming market shift will affect you as an agent.
You’ve probably already heard that a market shift is coming, so how can you position yourself for success during this time?
First off, don’t panic! This shift is nothing like what we saw in 2007. Back then, we had a combination of factors that led to a market crash, like a subprime mortgage market with low standards and low teaser rates that adjusted much higher later on. These caused buyers to be upside down in their homes as soon as the shift started, creating a foreclosure and short sale crisis which caused a recession.
“There won’t be excess inventory for the foreseeable future.”
The upcoming market shift is very different. Most homeowners have 30-year fixed loans and a significant amount of equity to boot. Home builders have built only half of the homes we’ve needed since the 2007 crash. We would need 1 million homes built per year to keep up with demand; instead, we have a deficit of around 10 million homes nationwide. At the current rate of building, that deficit is decreasing by 250,000 homes a year.
There won’t be excess inventory for the foreseeable future. A crash is unlikely; the market will gradually slow down, reducing the rate of home price appreciation or flattening out appreciation altogether.
This shift will impact agents who aren’t providing value. Mediocre agents who made money during a sizzling seller’s market and didn’t take the time to improve themselves will struggle. On top of that, lead sources like Zillow and Realtor.com are moving from selling leads to solo agents to referring leads to teams. These two factors will lead to a lot of solo agents leaving the industry.
If you’re thinking of becoming an agent or if you’ve been in the industry for less than five years, we recommend joining a team that has partnership agreements with online lead sources. They have plenty of leads and systems in place to assist their agents during the shift.
If you have questions about the upcoming shift or your place in it, feel free to call or email us. We would love to hear from you. You can also sign up for a free strategy session, look at our online events, or check out our training classes on our website.
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