When George Slusser joined WAV Group to lead our Mergers, Acquisitions, and Valuations team, we all reviewed his book titled Acquiring Profit. I love reading old business books because time is a cruel fact-checker, and also because the thoughts of leaders in the past give us great guidance for our current forecasting predictions. Namely, don’t make them.
When the book was written, the National Association of Realtors predicted that their membership would shrink from 820,000 to 500,000 by Y2k – the year 2000. At that time, there were also around 70,000 brokerages. The thought of industry leaders at the time forecasted the demise of the small, single office mom-and-pop brokerage. Oops!
NAR was not wrong. The research was not flawed. It was the opinions of industry leaders whose vision was clouded by the ideas and facts of that moment. If you want more examples of this research glitch, you can go back and read old copies of the Swanepoel T3 Trends Report, or old Inman articles that Brad wrote around the new year. Again, I am not bashing the research or my friends, but recognizing that long-range forecasting of industry trends is very difficult to do and is normally wrong to some degree. The only person who always gets it right is Rob Hahn. (Just kidding. Even the Notorious makes mistakes.)
George got it wrong too. Today, the mom-and-pop single office is alive and well. Nobody has an accurate count, but the number I hear is that there are around 85,000 real estate brokers in America today. Furthermore, the ranks of Realtors® have swelled to 1.2 or 1.3 million – plus potentially hundreds of non-Realtor licensed agents. Our industry is alive and growing.
I really do not know why trend reports are normally wrong. I do know that many leaders in our industry are upper middle class white men over the age of 50 – a homogenous audience that tends to be more pessimistic than optimistic. Perhaps they are the wrong ones to ask, or that a new agent has a better vision on the future of our industry than the successful leaders of today.
What prevails in the American real estate industry is not what these old folks think. Rather, it is the spirit of gumption. Real estate is driven by hard-working Realtors who wake up every day knowing that their income is driven by their effort. You would not believe how much traffic we have on RE Technology at 2 a.m.! The real estate industry is driven by the thousands of agents who are logging into CRMLS or Bright MLS each night to prepare for the new day ahead.
I will close with a few comments that do not really fit into this article, but I want to include them.
Compass is full of smart, innovative people who know very little about the real estate industry but are inspired and optimistic about growing a company that serves agents and consumers. They do not have stinkin’ thinkin’ about what can or cannot happen. They will make mistakes and run into walls, but they have the power and capital to fix those mistakes and get over that wall. They are also not alone. If you think that Realogy, Howard Hanna, Berkshire Hathaway, EXP, or any number of firms who belong to The Realty Alliance or Leading RE, or Keller Williams, or RE/MAX, or others will stop pushing through, you are also wrong. They may not always be first, but brokers in America will get it done.
And on a somber note, I will miss my friend Ken Jenny. Pictured here – Ken Jenny, David Gumpper, 2019 – NYC. I think that I saw Ken a few times after this in Newport, but COVID dampened our regular conference dinners.
We never shared the same opinion about MLSs, but were aligned on pretty much everything else. The many phone calls and meals we had together will be forever cherished in my heart. I always told Ken that when I grow up, I want to be like him. He was a great inspiration to me and Marilyn – and loved by our daughter Alexandra. Thank you for your friendship Ken. I miss you already. And, the answer to your question about the name of that river – it is called “d’ nile.”
Victor, I love your comments and insights. Interesting to know that the many leaders in our industry are upper middle class white men, over the age of 50 who tend to be more pessimistic than optimistic, and I share your opinion real estate is driven by hard-working Realtors who wake up every day knowing that their income is driven by their hard work. I think those of us that have made it in this business know that is the only way to be successful. I felt like you were speaking my thoughts exactly, after having spent the second half of my career in real estate, figuring out this industry and striving to be successful. I still am amazed at how resistant leaders are to change though. Seeing the changes and shifts in this industry for the last 20 years and knowing you must adapt, modify, recreate, and offer new products and methods of delivery to stay relevant, yet some want to remain stable, steady, safe, and as a result can become outdated, stale and left vulnerable. Thank you for sharing and I look forward to more of your insights.