The National Association of REALTORS® held its annual business meeting in New Orleans a few weeks ago. It was the latest in a century of meeting opportunities for the industry’s leaders, decision makers and groupies. The REALTOR® culture was alive with legacy and tradition.
But for the real estate brokerage community, this 2014 NAR Annual Meeting was anything but business as usual. At almost every turn, the meeting announced that the industry had entered into a new era in which the brokers who chose to keep their act together were about to remerge as key players in the industry, the transaction and, perhaps even the consumer relationship.
During the past several months, there has been a constant and relentless drumbeat of announcements, events, activities and communications all pointing to a resurgence of the influence and impact of brokers who understand how to play in the new industry arena. The following review of some of the highlights of the New Orleans meetings was designed to validate and verify what many already knew. The second coming of the intelligent broker is upon us.
It could be felt as participants discussed the recent News Corp related purchase of Move.com. The realization that the industry demographic had expanded to included yet another team of powerful global experts for whom the industry’s traditions and legacies paled in comparison to its long-denied financial potential. One could not help but feel the gaze of Rupert Murdoch on the trade show floor, working a checklist of what was relevant and what was fluff. Here is a man and an organization that will move ROI and profitability up the top of the industry’s priority list.
At the same time, the massive Berkshire Hathaway exhibit area served as another reminder that the industry dynamic also includes a major player for whom the annual meeting might be seen as more of a cultural event than a business opportunity. During the past 10 months, Berkshire Hathaway and its HomeServices unit have been working hard all across the U.S. to reorient the industry in the direction of brokerage success. It is obvious that, moving forward, this effort will continue with even greater intensity.
The brokerage community should have been overjoyed by the impact of the NAR Association Core Standards program that has thousands of association junkies at the edge of their seats facing charges of irrelevancy. It has become increasingly obvious that, like so many other powerful players, NAR’s vision of the future of the REALTOR® has moved significantly from its classic position. At the end of the meeting, the 850-member NAR board of directors approved policy recommendations directing NAR’s leadership team to create a new “Code of Excellence” educational requirement. The yet-to-be developed code appears to be the trade group’s latest effort to “raise the bar” of professionalism in the industry. Credit for these events must be given to the brokerage community that has steadily lobbied the industry regarding their sense that the REALTOR® associations and REALTORS® themselves are not part of their business solution.
Imagine the joy of those participants from Houston when Bob Hale, President and CEO of the Houston Association of REALTORS® received the prestigious On the Shoulders of Giants award from RE/MAX International and RISMedia. Hale has long been recognized for the quality and strength of the relationship between HAR and its brokerage community.
There was a constant background buzz regarding the rapidly deteriorating MLS situation. Another round of seasonal MLS leadership meetings has, with the exception of the really well done CMLS Best Practices program, expended significant resources yet netted little or no substantial progress. In the meantime, the large brokerage sector has given transparency to a growing realization that far too many MLSs are little more than vigilantes manning strategic roadblocks designed to protect local village markets. The fact that exceptional MLS units such as Rochester, Peoria, MLSListings, Inc, Houston, MRIS and a number of others are driving new standards of quality and competency may not be enough. It is clear that the industry will not allow this situation to continue. It is now just a matter of who will rescue the industry from this unacceptable behavior.
From the brokerage community’s perspective, one of the most exciting developments occurred when Realogy announced its new Ascend program. Only time will tell whether this program has the potential of making a major contribution to both the mindset and procedures involved in the long standing dilemma of succession planning within the real estate brokerage industry, but the initial design looks promising.
The Ascend program is based upon the fact that, despite the major role that the “have the kids take over” fantasy has played in the industry over the years, it has not, by and large, been a successful play. The Realogy press release quotes the Family Business Institute as suggesting that only about 30% of family businesses made it through the second generation in 2012. Experience over the past two years will probably find that even this number has dropped due in part to the massive changes that are taking place in all industries. Daughters and sons who might have found their parents’ traditional business model attractive will probably not find the task of reinventing it and/or rehabilitating its dysfunctions equally attractive. The problem will clearly not be improved by the fact that an ever-aging brokerage population will increasingly seek an escape from an invading technology sector, increased competition from new business models, a consumer that is now some 30 years younger and, most importantly of all, seeking a well-deserved retirement.
This program is a brilliant idea. A real “Hail Mary” strategy. Realogy is to be congratulated for addressing this major industry issue. Hopefully they will be rewarded with many high quality relationships with the next generation of brokers that they will help create through the Ascend program.
The National Association of REALTORS® held its annual business meeting in New Orleans. The city performed well and a good time was had by most. However, there was tension in the air and a powerful message was in the wind. Lurking between the drumbeat of progress and the laughter of celebration were a number of clear signals that the industry has now fully engaged with a new era. The message for the brokerage community was even more vibrant. Now is the time to create your strategic, intent-driven business plan.