By Michelle Sandlin
“On the Move” – Houston Chronicle: May 22, 2015
Earlier this month, hundreds of mobility professionals gathered in Las Vegas for Worldwide ERC’s (Employee Relocation Council’s) National Relocation Conference.
The theme of this year’s conference was “Connect, Collaborate…Transform,” which was echoed throughout the many educational sessions and networking opportunities available to attendees.
While several sessions were geared towards mobility professionals from the real estate side of the industry, one in particular seemed to really hit the nail on the head as to the future of real estate. That session was “Game Changers: The Future of Real Estate,” which featured a panel of industry leaders who discussed threats and opportunities that are shaping the real estate business and impacting the relocation industry.
Moderated by Kathy Connelly, senior vice president of corporate services for Berkshire Hathaway HomeServices Georgia Properties in Roswell, Georgia, the panelists were:
Pam O’Connor, president and CEO of Leading Real Estate Companies of the World in Chicago, Illinois; Earl Lee, president of Berkshire Hathaway HomeServices Real Estate Center in Scottsdale, Arizona; and Dan Forsman, president and CEO of Berkshire Hathaway HomeServices Georgia Properties in Roswell, Georgia.
Connelly began by asking each of the panelists to provide a view of the current market from their perspectives, and to discuss the real estate recovery.
In terms of the recovery, Lee said that the market is moving in the right direction, but added that this was a slow process that is not happening fast enough. He also made the important point that this slow recovery is not necessarily the case in all markets, since real estate is considered a local rather than a national market.
“It’s hard to say what the real estate business is like, because fortunately, all real estate is local, so depending on where you are, your own individual market may not look anything like what’s happening across the country,” Lee said.
O’Connor reiterated Lee’s comments about the recovery, and addressed the changing market, which she said is being driven largely by the millennial generation of homebuyers.
“This new generation, which is bigger than the Boomers, doesn’t want the big houses in the suburbs,” said O’Connor. “So, we’re going to have all of this housing stock and we don’t necessarily have people matching it up. It will be very interesting to see where this goes. We’re all going to have to adapt quite a bit.”
Forsman added, “As the industry continues to change and consolidate, I think it’s going to be interesting. There are more revelations in the market today.”
Connelly then asked the panelists what they see as the biggest threat to the real estate industry.
O’Connor pointed to web portals like Zillow, Trulia and Realtor.com. She said that a lot of people in the industry are worried because they perceive these sites as coming between the brokerage industry and the consumer. She said that she is more concerned about these portals coming between the broker and their agents, in spite of claims by Zillow, for example, of not wanting to be in the brokerage business and not wanting to be a disruptor.
“Well, you don’t have to be in the business to be a disruptor,” emphasized O’Connor.
She said that she perceives this to be a real threat to the future of real estate brokerages as the glue and infrastructure that holds everything together. Without brokerages, O’Connor said that there would just be a sea of agents with no oversight and no training. As such, she warned against the marginalization of brokerages by these portals.
Forsman added, “I think the biggest risk to what I do in leading a real estate brokerage company now that we have more reach, and relocation, and new homes, and property management, and all of this stuff going on, is staying focused on what our primary goal is and what our primary business is, which is the people business. That’s related to consumers, helping people sell their home and buy a home, and in bringing in the talent that allows us to do that.”
As for Lee, he said that a potential threat to the real estate industry lies in its inability to understand the value of the tremendous amount of data that it has amassed and what to do with that data. In general, he said that the industry often struggles to recognize the changes that are taking place, and that it is resistant to change.
“The biggest threat to the real estate industry is its inability to coalesce together to make sure it does what’s best for the consumer, as well as what’s best for the industry,” said Lee.
Please come back next week for Part 2 of this compelling discussion on the future of real estate and the impact on the relocation industry.