2011 vision speech-kw beverly hills highlights
DESCRIPTION
This Presentation outlines Gary Keller's Vision Speech from the 2011 Family Reunion. It shows trends in real estate and provides strategies for overcoming our current market.TRANSCRIPT
1
The Numbers that Drive Real Estate
2
The Numbers That Drive
U.S. Real Estate
1. Home Sales
2. Home Prices
3. Inventory
4. Mortgage Rates
5. Affordability
3
1. Home Sales (In Millions)
Sales decreased 4.8% in 2010, mainly due to softer demand in
the second half of the year.
5.18
7.08
5.16 4.91
Source: National Association of REALTORS®
4.96
4
In Q3 2010, all 50 states experienced
a decrease in sales …
TX
UT
MT
CA
AZ
ID
NV
OR
IA
COKS
WY
NM
MO
MN
NE
OK
SD
WA
AR
ND
LA
IL
FL
GAAL
WI
VA
IN
MI
MS
KY
TN
PA
NC
SC
WV
NJ
ME
NY
VT
MD
NH
CT
DE
MA
RI
AK
HI
Below 10%
Below 20%
Home Sales Direction
(Year-Over-Year Change)
OH
Source: National Association of REALTORS®
Below 30%
Below 40%
5
In Q4 2010, all states except for Virginia experienced an increase in sales …
TX
UT
MT
CA
AZ
ID
NV
OR
IA
COKS
WY
NM
MO
MN
NE
OK
SD
WA
AR
ND
LA
IL
FL
GAAL
WI
VA
IN
MI
MS
KY
TN
PA
NC
SC
WV
NJ
ME
NY
VT
MD
NH
CT
DE
MA
RI
AK
HI
OH
Source: National Association of REALTORS®
Sales Increased
Sales Decreased
Home Sales Direction
(Year-Over-Year Change)
6
2. Home Prices (Annual Appreciation)
Source: National Association of REALTORS®
If home prices actually grew by 4% every year from 1989, the median home price would be $211,082, which is approximately 18% above where we are
today.
7
2. Home Prices (In Thousands)
The median home price increased slightly by 0.3% in 2010, the
first annual price gain since 2006.
Source: National Association of REALTORS®
$153K
$222K
$173K
$211K
8
3. Inventory (Months Supply)Number of months it would take to sell all the homes on the market at the current rate of sales
Source: National Association of REALTORS®
Softer demand in the second half of the year kept inventory of existing homes at a relatively high level of 9.4 months at the end of 2010. However, months of inventory has declined substantially from its peak of 12.5 months reached in July.
9
4. Mortgage Rates (30-Year Fixed)
Source: Freddie Mac
Mortgage rates averaged 4.69% in 2010, an all-time low since Freddie Mac started tracking in 1971.
Mortgage rates ranged from 4.23% to 5.1% in 2010. At the end of December, rates stood at 4.71%.
10.3%
6.0%5.0%
4.7%
5.05%
10
Let’s put this in perspective …
1989 2010 2011
Bread $0.67 $2.49 $2.49
Gas (gal.) $0.97 $2.73 $2.73
New Car $15,350 $28,400 $28,400
Existing Home $94,000 $173,000 $173,000
Mortgage Rate 10% 4.69% 5.05%
Monthly Payment $825 $896 $934
And you still wouldn’t get a mortgage as cheap as you could in 2010.
11
5. Housing Affordability (% of Income)% of mean family’s income required to make mortgage payments on a median-priced home
Source: National Association of REALTORS®
15%
14%
40-year average = 21.9%
Housing affordability was the most favorable on
record in 2010.
12
Economic Snapshot
13
U.S. Economic Snapshot
1. Gross Domestic Product
2. Inflation
3. Unemployment
14
1. Gross Domestic Product(Year-Over-Year Growth)
Source: Bureau of Economic Analysis
Consumer spending and strong exports contributed
the most to economic expansion in 2010.
15
1. Gross Domestic Product(Year-Over-Year Growth)
Source: Bureau of Economic Analysis 16
2. Inflation
Source: Bureau of Labor Statistics
1.6%
In 2010, inflation averaged around 1.6%.
In the near term, inflation pressures are expected to remain subdued,
allowing the Fed to stay the course of its loose monetary policies.
Unofficial
Rate Target
17
3. Unemployment
Source: Bureau of Labor Statistics
9.6%
Unemployment is making slow progress, dropping from
9.9% in 2009 to 9.4% in the final month of 2010.
Long-term average: 5.6%
18
The Events That Drove The Numbers
19
The Six Events That Drove
the U.S. Numbers
1. The available sides per agent remained on par with 2009.
2. The extended home buyer tax credit boosted demand and
stabilized home prices in the first half of 2010.
3. Concerns about proper foreclosure procedure delayed the
influx of distressed properties into the market.
4. Monetary stimulus aid continued to lend support.
5. Credit conditions remain tight.
6. Uncertainty about economic outlook acted as restraint on
business and consumer spending.20
1. The available sides per agent remained on par with 2009
Source: National Association of REALTORS®
In 2010, another 45,987 Realtors left the industry,
leaving those remaining in the market with a steady
share of business despite softer sales.
21
National Association of Realtors
Membership vs. Existing Home SalesNAR Membership: 1.07
Million
Existing Home Sales:
4.91 Million
Source: National Association of REALTORS®
1977
1982
1990
19982008
201014
7
7.9
13.8
8.29.2
Sides per Agent
22
Housing Economic Recovery Act of 2008
$7,500 temporary FTHB tax creditExtended and Expanded
$8,000 FTHB Tax Credit
Must sign contract by April 30
Must close by June 30
Closing
Deadline
Extended
to September
30
Gradual
Recovery
without Tax
Credit
American Recovery & Reinvestment Act of 2009
$8,000 FTHB tax credit
2. Extended home buyer tax credit increased buyer traffic in the first six months of 2010
Source: National Association of REALTORS®
Jan
‘09
Jun
‘09
Oct
‘09
Nov
‘09Apr
‘10 Jun
‘10Sep
‘10
Dec
‘10
23
Recession
Began December 2007
Housing Economic Recovery Act of 2008
$7,500 temporary FTHB tax credit
American Recovery & Reinvestment
Act of 2009
$8,000 FTHB tax credit
Extended and Expanded
$8,000 FTHB Tax Credit
Must sign contract by April 30
Must close by June 30
Closing
Deadline
Extended
to September
30
Gradual
Recovery
without Tax
Credit
Source: National Association of REALTORS®
HOME SALESIn Millions
2. Extended home buyer tax credit boosted demand & stabilized home sales in the
first half of 2010
24
Recession
Began December 2007
Housing Economic Recovery Act of 2008
$7,500 temporary FTHB tax credit
American Recovery & Reinvestment
Act of 2009
$8,000 FTHB tax credit
Extended and Expanded
$8,000 FTHB Tax Credit
Must sign contract by April 30
Must close by June 30
Closing
Deadline
Extended
to September
30
Gradual
Recovery
without Tax
Credit
Source: National Association of REALTORS®
HOME PRICESIn Thousands
2. Extended home buyer tax credit boosted demand & stabilized home prices
25
3. Concerns about foreclosure procedure delayed the influx of distressed properties into the market
Source: RealtyTrac
The number of foreclosure notices and bank repossessions plunged in
November and December, as banks halted tens of thousands of foreclosures in
the face of the robo-signing scandal.
26
3. Concerns about foreclosure procedure limited foreclosure sales and steadied prices
Source: National Association of REALTORS®
Distressed Sales % of Total SalesIn 2010, distressed properties accounted
for 34% of all sales, down from 36% in
2009 and 37% in 2008.
27
Rising foreclosure rates (% of U.S. Homes)
remain a trouble spot for the housing market
Source: RealtyTrac
In 2010, foreclosure filings were reported on a record 2.9
million (2,871,891) U.S. properties despite a thirty-month
low reached in December due to foreclosure freezes.
28
4. Monetary stimulus aidcontinued to lend support
Source: Mortgage Bankers Association
Historically low rates fueled a surge in refinancing activity earlier in 2010,
helping homeowners save billions of dollars.
29
6. Uncertainty about economic outlookacted as restraint on business and consumer spending
Source: Bureau of Economic Analysis
Heightened level of unemployment persists and remains the biggest risk to the recovery.
Any meaningful improvement in consumer confidence and their purchase decisions is
contingent on a significant pickup in job growth.
Consumer Spending and Unemployment
30
5. Strong currency has hurt Canadian trade
• As commodity prices elevated, appetite for Canadian currency strengthened, leading to
Canada’s rising exchange rate against its major counterparts.
• Exports were dampened by gains in the Canadian dollar.
• Canada's economy slowed in mid-2010 when imports increased (subtracting from growth)
and exports decreased.
• Bank of Canada noted that about two-thirds of the widening of Canada’s trade deficit in
recent years is due to a stronger Canadian dollar.
2009: 1 CAD 0.88 USD
2010: 1 CAD 0.97 USD
Source: Bank of Canada 31
What the Governments Are Doing
32
1. Extended Bush-era income tax cuts
2. Extended conforming loan limits
3. Started second round of Fed’s monetary stimulus
4. Halted new mortgage disclosure rules under the Truth inLending Act
What the U.S. Government Is Doing
33
What: President Obama signed an $858 billion tax bill into law on December 17, keeping income tax rates
from increasing before the new year.
Why: To put more money in the pockets of families most likely to spend it, help businesses to grow and
as a result, spark demand, spur job creation, and strengthen the economy in 2011.
How: 1. Extends the Bush-era income tax cuts on income, capital gains, and dividends for two years
2. Reduces Social Security payroll tax rates by 2% for one year on income up to $106,800
3. Extends jobless benefits for 13 months beyond the current 99 weeks
4. Allows businesses to write off 100% of capital investments between September 9, 2010 and December 31,
2011
5. Extends dozens of expired and expiring tax breaks, including a research and development tax credit and a
college tuition tax credit that was created in last year’s economic stimulus law
6. Sets the estate tax rate at 35% for two years and would apply it only to estates worth more than $5 million.
Under current law, the estate tax has lapsed for 2010 and is set to jump next year to 55%
Implications: Many economists predict the tax package could increase the economic expansion rate by a
substantial 1% next year.
1. Extended Bush-era income tax cuts
34
What: In July 2008, the housing recovery bill raised the limit
on conforming loans in high-cost areas to a maximum
of 125% of local median home price, up to an overall
cap of $729,750 from $417,000 everywhere.
Why: To increase credit available in higher-priced markets.
When: These limits were set to expire in December 2010 and
have now been extended through September of 2011.
2. Extended conforming loan limits
35
What: Fed announced the second round of quantitative easing program, known as QE2, in early November 2010 to jump-start the slowing recovery.
Why: The program aims at spurring business and consumer spending by keeping interest rates low.
How: Fed plans to purchase $600 billion in long-term treasuries over the next eight months. The Fed also announced it will reinvest an additional $250 billion to $300 billion in treasuries with the proceeds of its earlier investment.
When: The bond purchases aimed at stimulating the economy will total up to $900 billion and will be completed by the end of the third quarter of 2011.
3. Started second round of monetary
stimulus
36
4. Halted new mortgage disclosure rules
under the Truth in Lending Act • Fed held off on finalizing pending rule changes under Regulation Z of the Truth in Lending Act that were
proposed in August 2009 and September 2010 that would have mandated new consumer disclosure
requirements for:
• Closed-end mortgage loans (2009)
• Home equity lines of credit or HELOCs (2009)
• Reverse mortgages (2010)
• The proposed new rules were initiated in response to claims that homeowners were signing up for
unsustainable and unsuitable mortgages without understanding the terms of the loans during the boom
years, which fueled unsound lending practices and led to the mortgage market meltdown in 2007.
• The newly created Consumer Financial Protection Bureau (CFPB) will assume general rulemaking authority
for TILA, RESPA (which were previously overseen and enforced by Fed and HUD, respectively) and federal
jurisdiction over consumer protections in July. The agency is required by the Dodd-Frank Reform Act to
combine the mortgage disclosures required by both TILA and RESPA in a single form within eighteen
months after the designated transfer date.
• The delayed implementation of any new disclosures adopted by the Fed will mitigate compliance difficulties
which may arise with the issuance of multiple rules with different implementation periods.37
Luxury Real Estate
38
The strong rebound in the wealthy is a positive signal
for the luxury market.
End of YearAverage Net Worth
of Billionaires
Number of
Billionaires
2007 $3.9 billion 1,125
2008 $3 billion 793
2009 $3.5 billion 1,011
Source: Forbes
17%
increase
27%
increase39
Source: Spectrum Group
Percent Change in Number Affluent, by Net Worth
40
0
6
12
18
24
30
36
42
Dec '08 Mar '09 Jun '09 Sep '09 Dec '09 Mar '10 Jun '10 Sep '10 Dec '10
Luxury Move Up Starter 42
36
30
24
18
12
6
0Seller’s Market
18
40
41
181
143
117 112
90 92
60
120
180
Dec '08 Mar '09 Jun '09 Sep '09 Dec '09 Mar '10 Jun '10 Sep '10 Dec '10
Luxury Move Up Starter
180
120
60
42
100%
95%
90%
85%
80%
43
Greater Supply + Longer DOM
+ Greater Discount = Opportunity for:
1. Investors in luxury market for both
flippers and holders of undervalued
properties.
2. Move-Up buyers who were previously
priced out of luxury market.
44
Commercial Real Estate
45
SectorUnited States Canada2009 2010 2009 2010
Office 15.7% 17.4% 9.9% 9.4%
Industrial 13.2% 14.5% 8.1% 7.4%
Retail 12.0% 12.7% 5.5% 4.2%
Multifamily 7.4% 6.1% 2.8% 2.6%
Sources: NAR, CBRE, CMHC46
Source: US CMBS Delinquency Rates, Trepp LLC. Graph scaled based on actual data for trend purposes only.47
Moody’s/REAL Commercial Property Price Index (CPPI) National - All Property Types
2.0
1.6
1.2
0.8
Index, D
ecem
ber
2000 =
1
Source: Moody’s/REAL Commercial Property Price Index48
2009-2011
“Extend and Pretend”to
2012 and forward
“Extend and Amend”
63% Extend
withModification
16% Foreclose
14% Sell
7% Extend
withoutModification
Maturing Loans: Preferred Strategy for
Lenders by Mid-2011
All Commercial Property TypesSource: Emerging Trends in Real Estate 2011 Survey
49
Flat Market
1. No new development
means demand has time
to catch up with supply
2. Economy needs time
to improve which will
strengthen demand
New Commercial Loans (in billions)
Source: Commercial Mortgage Alert50
1. Distressed Assets (U.S.)
2. Quality Yield Properties
3. Tenant Representation
4. Owner Occupants
51
How Do We Recover?
52
The Four Keys to Housing Recovery
53
What Can NAR Tell Us About 2010?
54
First-Time Home Buyers
55
Primary Reason for Purchasing a Home
All Buyers First-time Buyers Repeat Buyers
20052009 2010 2009 2010 2009 2010
Desire to own a home 39% 35% 31% 62% 53% 11% 10%
Desire for larger home 20 9 9 2 2 16 15
Change in family situation * 9 8 8 7 10 10
Home buyer tax credit * 3 8 6 13 1 3
Job-related relocation or move 11 9 7 2 2 16 12
Affordability of homes * 8 6 10 8 6 4
Desire to be closer to
family/friends/relatives8 4 5 1 1 7 10
Desire for a home in a better
area
*4 5 1 2 7 7
Desire to be closer to
job/school/transit* 3 3 1 2 5 5
Desire for smaller home 6 3 3 * * 5 5
Retirement 3 3 3 1 * 4 5
Establish household * 2 2 2 4 1 1
56
Tenure in Previous Home
2009 2010
1 year or less 4% 3%
2 to 3 years 18 8
4 to 5 years 21 16
6 to 7 years 12 18
8 to 10 years 15 17
11 to 15 years 12 17
16 to 20 years 8 8
21 years or more 11 13
Median 7 8
21%
38%
55%
57
Buyer’s Expected Length of Tenure
2009 2010
1 year or less 1% 1%
2 to 3 years 3 3
4 to 5 years 12 12
6 to 7 years 3 3
8 to 10 years 14 13
11 to 15 years 5 5
16 to 20 years 22 22
Don’t Know 39 42
Median 10 10
22%
27%
40%
58
First Step in Home Buying Process
All Buyers First-time Buyers Repeat Buyers
2009 2010 2009 2010 2009 2010
Looked online for properties for sale 36% 36% 31% 32% 40% 41%
Contacted a real estate agent 18 19 14 16 21 22
Looked online for information about the
home buying process11 11 16 15 7 8
Contacted a bank or mortgage lender 8 8 11 10 6 6
Drove by homes/neighborhoods 8 7 6 6 10 9
Talked with a friend or relative about
home buying process7 7 11 11 3 3
Visited open houses 4 4 2 3 5 5
Looked in newspapers, magazines, or home
buying guides3 2 2 2 3 2
Attended a home buying seminar 1 2 3 3 * *
Contacted builder/visited builder models 2 1 1 1 2 2
59
Number of Weeks in Home Search
2001 7
2003 8
2004 8
2005 8
2006 8
2007 8
2008 10
2009 12
2010 12
60
Info Sources Used in Home Search
2009 2010
Internet 90% 89%
Real estate agent 87 88
Yard sign 59 57
Open house 46 45
Print newspaper advertisement 40 36
Home book or magazine 26 23
Home builder 18 16
Relocation company 4 3
Television 8 7
Billboard 6 5
Every source was used less except one – YOU!61
2001 2003 2004 2005 2006 2007 2008 2009 2010
Real estate agent 48% 41% 38% 36% 36% 34% 34% 36% 38%
Internet 8 11 15 24 24 29 32 36 37
Yard sign/open house sign 15 16 16 15 15 14 15 12 11
Friend, relative or neighbor 8 7 7 7 8 8 7 6 6
Home builder or their agent 3 7 7 7 8 8 7 5 4
Directly from sellers/knew the sellers 4 4 5 3 3 3 2 2 2
Print newspaper advertisement 7 7 5 5 5 3 3 2 2
Home book or magazine 2 1 2 1 1 1 1 * *
Other 3 6 4 * * * * * *
Where Buyers Found the Home They
Purchased
62
Value of Website Features
Very UsefulSomewhat
UsefulNot Useful
Did Not Use /
Not Avail
Photos 85% 14% 1% 1%
Detailed information about properties for sale 83 16 1 1
Virtual tours 61 27 5 6
Real estate agent contact information 45 35 10 10
Interactive maps 43 35 10 12
Neighborhood information 40 43 9 8
Pending sales/contract status 33 35 16 16
Detailed information about recently sold properties 30 39 16 15
Information about upcoming open houses 21 34 22 23
63
Websites Used in Home Search
2005 2009 2010
Multiple Listing Service (MLS) website 50% 60% 59%
REALTOR.com 54 46 45
Real estate company website 38 46 43
Real estate agent website 31 45 42
Other website with real estate listings 11 30 41
For-sale-by-owner website * 17 15
Newspaper website 15 9 8
Real estate magazine website 6 4 4
Social networking websites (e.g. Facebook, Myspace, etc.) * 1 2
Video hosting websites (e.g. YouTube, etc.) * * 1
Warning: Get Better or Get Left Behind!!!64
Method of Home Purchase
Page 65
2001 2003 2004 2005 2006 2007 2008 2009 2010
Through a real estate agent or
broker69% 75% 77% 77% 77% 79% 81% 77% 83%
Directly from builder or builder’s
agent15 14 12 12 13 12 10 8 6
Directly from the previous owner 15 9 9 9 9 7 6 5 5
Through a foreclosure or trustee
sale1 1 1 * 1 1 3 10 4
Buyer Rep. Arrangement with Agent
2009 2010
Yes, a written arrangement 43% 40%
Yes, an oral arrangement 19 17
No 28 29
Don’t Know 11 13
66
What Buyers Want Most from Agents
Help with the price
negotiations
14%
Help buyer negotiate
the terms of sale
12%
Help with paperwork
10%
Determine what
comparable homes were
selling for
6%
Help determining
how much home
buyer can afford
3%
Help find and
arrange financing
2%Other
3%
67
How Buyers Found Their Agent
2005 2009 2010
Referred by (or is) a friend, neighbor or relative 44% 44% 48%
Internet website 7 10 10
Used agent previously to buy or sell a home 11 10 9
Visited an open house and met agent 7 6 7
Saw contact information on For Sale/Open House sign 6 7 6
Walked into or called office and agent was on duty 4 4 5
Referred through employer or relocation company 4 4 3
Personal contact by agent (telephone, email, etc.) 3 3 3
Newspaper, Yellow Pages or home book ad 2 1 1
Direct mail (newsletter, flyer, postcard, etc.) 1 * *
Other 6 6 7
68
Number of Agents Interviewed by Buyers
2002 2005 2009 2010
One 59% 64% 66% 64%
Two 22 20 19 21
Three 19 10 10 10
Four or more -- 5 6 6
69
Reputation of agent
20%
Agent is friend or
family member
17%
Agent’s knowledge of
the neighborhood
12%
Agent has caring
personality/good listener
11%
Agent’s association
with a particular firm
3%
Professional
designations held by
real estate agent
2%
Other
5%
Most Important Factors When Choosing
an Agent
70
2005 2009 2010
Good financial investment 94% 87% 85%
Better than stocks * 54 47
About as good as stocks * 26 30
Not as good as stocks * 7 9
Not a good financial investment 1 3 4
Don’t know 5 10 11
Buyer’s View of Home as a Financial
Investment
71
Only 9% did!!!
Would Buyer Use Agent Again or
Recommend to Others?
72
Method Sellers Used to Find Agent
2005 2009 2010
Referred by (or is) a friend, neighbor or relative 43% 40% 41%
Used agent previously to buy or sell a home 28 24 23
Personal contact by agent (telephone, email, etc.) 5 5 4
Visited an open house and met agent 4 5 4
Referred by another real estate agent or broker 3 4 4
Internet website 2 3 4
Saw contact information on For Sale/Open House sign 4 3 3
Referred through employer or relocation company 3 5 3
Walked into or called office and agent was on duty 2 3 2
Direct mail (newsletter, flyer, postcard, etc.) 3 3 2
Newspaper,Yellow Pages, or home book ad 2 2 2
Advertising specialty (calendar, magnet, etc.) * 1 1
Other * 5 6
73
2002 2010
One 76% 66%
Two 16 19
Three 8 10
Four -- 3
Five or more -- 3
Number of Agents Contacted Before
Deciding Who to Sell Home With
74
What Sellers Most Want from Agents
2005 2009 2010
Help price home competitively 17% 22% 23%
Help find a buyer for home 28 21 21
Help seller market home to potential buyers * 19 20
Help sell the home within specific time frame 27 19 19
Help seller find ways to fix up home to sell it for more 12 10 7
Help with negotiations and dealing with buyers 5 5 5
Help with paperwork/inspections/preparing for settlement 7 3 4
Help seller see homes available to purchase 3 1 1
75
2005 2009 2010
Reputation of agent 57% 36% 35%
Agent is honest and trustworthy * 21 23
Agent is friend or family member * 16 16
Agent’s knowledge of the neighborhood 17 13 12
Agent has caring personality/good listener * 6 4
Agent’s association with a particular firm 6 4 4
Professional designations held by agent 3 1 1
Other 17 3 4
Most Important Factors in Choosing an
Agent to Sell Home
76
Negotiating Commission Rate or Fee
2009 2010
Real estate agent initiated discussion of compensation 44% 44%
Client brought up the topic and the real estate agent was willing to
negotiate their commission or fee25 25
Client brought up the topic and the real estate agent was not willing to
negotiate their commission or fee9 9
Client did know commissions and fees could be negotiated but did not
bring up the topic10 10
Client did not know commissions and fees could be negotiated 13 11
77
Only 24% of sellers use the same agent they used
previously to buy or sell a home.
Would Seller Use Agent Again or
Recommend to Others?
78
Method Used to Sell Home
2001 2003 2004 2005 2006 2007 2008 2009 2010
Sold home using an agent or broker 79% 83% 82% 85% 84% 85% 84% 85% 88%*
For-sale-by-owner (FSBO) 13 14 14 13 12 12 13 11 9**
Sold to home buying company 1 1 1 1 1 1 1 1 1
Other 7 3 3 2 3 2 2 3 3
* Highest Level in 9 Years!
** Lowest Level in 9 Years!
79
Incentives Offered to Attract Buyers
2009 2010
None 58% 56%
Home warranty policies 21 25
Assistance with closing costs 18 20
Credit toward remodeling or repairs 6 5
Other incentives, such as a car, flat screen TV, etc. 3 4
Assistance with condo association fees 1 1
Other 5 4
80
Annual KW MLS StudyTop 5 Full Service vs. Top 5 Limited Service
81
Median Commission Rates
Overall commission rates softened slightly in 2010,
averaging 5.42%.
Source: KWRI Internal Commission Studies
Median Commission Rates – Seller Side
Seller side commission rates decreased slightly by less
than a tenth of a point.
Source: KWRI Internal Commission Studies
Median Commission Rates – Buyer SideBuyer side commission rates decreased more than a
tenth of a point to 2.86% in 2010.
Source: KWRI Internal Commission Studies
Median Commission Amount – Seller Side
Median commission amount on the seller side increased by 26% due to a substantial 23% gain in
the median price of homes in the sample.
Source: KWRI Internal Commission Studies
Median Commission Amount – Buyer Side
On the buyer side, commission amounts increased by approximately 11% due to a 4% increase gain in
the median price of homes in the sample.
Source: KWRI Internal Commission Studies
So, What Do We Do?
87
Marnie Bennett
1. Have a business plan/ know your goals and numbers
2. Invest in yourself through education and training. Set aside time and
money specifically for that purpose
3. Be willing to adapt and embrace change / Internet, Social Media
4. Recognize what’s working for you, and more importantly what’s not
working – What is your Unique Selling Proposition?
5. Be aware of your weaknesses and work to overcome them – or hire
smartly to complement your skill set
Bennett Real Estate Professionals
Ottawa, Ontario
260 units
$3.9M GCI
$73M closed volume
88
Chris Heller
1. Create the habit of discipline to do your job every day
2. Focus on the two E’s: efficiency and effectiveness
3. Desire – “Be willing to do whatever it takes”
4. Improve your versatility, the ability to deal with a wide variety of
people
5. Absolute commitment to having a schedule and following a
schedule
The Heller Real Estate Group
San Diego, CA
149 units
$2.2M GCI
$86.5M closed volume
89
Ben Kinney
1. The market should dictate your activity
2. Take listings and focus on pricing
3. Market for cheap
4. Leverage the Internet
5. Focus on the activity not the result
Bellingham, WA
278 units
$1.6M GCI
$64M closed volume
90
“Persistence and determination alone
are omnipotent. The slogan „Press On‟
has solved and always will solve the problems of the human race.”
- Calvin Coolidge
91
PRESS ON!
92