And we certainly can\u2019t predict the next pandemic.<\/p>\n
But what we can do is prepare to navigate through the next shift. We talked to three seasoned agents, who shared helpful tips to selling real estate in a market shift.<\/p>\n Jason Huerkamp<\/a> is a successful Minneapolis real estate agent who sells homes 84% faster than the average Minneapolis agent.<\/p>\n Over the years, Huerkamp witnessed several market shifts, from a seller\u2019s to a buyer\u2019s market and back again. \u201cReally, 2007 is when you knew something was changing, and 2008 is when you really could add confirmation that something was going terribly wrong,\u201d says Huerkamp.<\/p>\n He notes that the mid-2000s housing bubble was entirely different than any other shift. \u201cThe real estate industry was built on a house of cards, there was a lot of fraud going on, and title and mortgage lending was all over the place.\u201d<\/p>\n When experts predict a recession<\/a>, they typically demonstrate signs and patterns that correlate with a potential market shift.<\/p>\n Some signs might include when stocks plummet, a swift increase in unemployment rates, and a significant decline in economic activity. An example is the 9\/11 terrorist attacks, with 143,000 jobs lost in New York City<\/a> within a three-month period that lead to a micro recession<\/a>.<\/p>\n Even with financial expert insight, Heurkamp recalls his own signs of market shifts in the past. \u201cYou could start seeing there were a lot of foreclosures,\u201d says Huerkamp.<\/p>\n There was also a significant discrepancy in home values. \u201cYou started going to listing appointments, and you knew what the people bought it for, and you knew what it was worth even if they didn\u2019t refinance and pull a bunch of money out.\u201d<\/p>\n During the mid-2000s housing bubble, an oversupply of unsold homes<\/a> sat on the market, including foreclosures.<\/p>\n This oversupply was largely in part of lax lenders standards, such as zero-down-payment loans<\/a> and negative amortization loans.<\/p>\n Another red flag indicating a current market shift is a large decrease in national home prices. This reflects Huerkamp\u2019s early observation of inconsistent home value and sale price.<\/p>\n Huerkamp believes that COVID-19 won\u2019t necessarily result in major changes for median home prices. \u201cThe average price will probably fall, but the median number probably isn\u2019t going to move down very much,\u201d says Heurkamp. \u201cI think that the higher-end real estate market in any particular city or area or locale, that has a chance of probably being affected the most.\u201d<\/p>\n One thing that remains certain is that the US has a long history of market shifts, both positive and negative. Along with Huerkamp, two other real estate agents bring their advice on how to handle these shifts to come out stronger on the other side.<\/p>\n Troy Walseth<\/a> and Wendy Lockhart are on the Keller Williams Realty team for Seminole, Florida and the Gulf Beaches. Walseth started his real estate career in 1993 and navigated all of the major and minor market shifts since that period. Lockhart received her license at the end of 2007 and began her career during the last major market shift.<\/p>\n Walseth, Lockhart, and Heurkamp all agree that COVID-19 is unlike any other market shift of their lifetime. \u201cThe saving grace about this shift is that it\u2019s totally different,\u201d says Heurkamp.<\/p>\n \u201cIt\u2019s based on a pandemic, and it\u2019s a totally different thing. People have to realize that, and it\u2019s hard to wrap your hands around that.\u201d<\/p><\/blockquote>\n No matter the cause of the market shift, these agents offer six smart suggestions to make it through.<\/p>\n Many people will experience a change in income or cash flow due to COVID-19, even it\u2019s a trickle-down effect later down the line.<\/p>\n \u201cWe\u2019re looking at our bottom line every few days to a week,\u201d says Walseth. \u201cJust so we can see where we can make a cut in the business and what\u2019s not important right now. We\u2019re doing it personally and professionally.\u201d<\/p>\n If you have trouble deciding what expenses (if any) to cut, think about how those investments serve you.<\/p>\n \u201cWe\u2019re putting properties under contract, so you don\u2019t want to chop anything that\u2019s working right now,\u201d says Walseth.<\/p>\n Lockhart advises agents to step back and look at the big picture for ROI. \u201cAgents should be looking at: how long can I sustain my business, how much cash do I have on hand, and does this return make sense?\u201d Think of how your finances will look in three or four months if things don\u2019t change.<\/p>\n For example, Walseth and Lockhart have three different CRMs. They want to use those more efficiently and combine them to cut costs.<\/p>\n Rely on your local board, the National Association of Realtors, and your local health department to learn of new guidelines or changes in the industry.<\/p>\n \u201cYou can\u2019t cut back on the customer service to the client. You still need to have professional photos, and if the property needs to be staged, you still have to stage it,\u201d says Lockhart.<\/p>\n Walseth agrees with Lockhart that marketing is still a priority. \u201cI believe you still need to be doing marketing, but maybe with a different message,\u201d says Walseth. \u201cYou\u2019ve got to keep up with your lead generation.\u201d<\/p>\n Lead generation won\u2019t look the same during or even after COVID-19 as it did at the start of 2020.<\/p>\n All three agents agree that it\u2019s important to check in with clients and ask how they\u2019re doing. They might have questions or concerns that you can help alleviate. It\u2019s also wise to check in with past clients and referrals.<\/p>\n COVID-19 presents its own unique set of challenges to everyone, including agents. One of those challenges is social distancing, and our three agents share how you can overcome these obstacles.<\/p>\n The order to keep a distance of six feet apart might feel like a challenge in real estate, especially when you interact with clients. \u201cSellers care who comes into their house, and buyers care about the seller\u2019s house,\u201d says Lockhart. Both parties are concerned about sanitation and social distancing, and technology can help bridge the gap until it\u2019s safe to resume normal behavior.<\/p>\n![\"\"](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2020\/04\/selling-real-estate-in-market-shift-graph-666x381.png\")
<\/a>Let\u2019s navigate market shifts of the past<\/h2>\n
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<\/a>6 tips to handle a market shift<\/h2>\n
1. <\/b>Watch your bottom line<\/h3>\n
2. <\/b>Look at the return on investment<\/h3>\n
3. Combine to cut costs<\/h3>\n
4. Stay informed<\/h3>\n
5. Don\u2019t axe your marketing efforts, listing or otherwise<\/h3>\n
6. Think about how you communicate and generate leads<\/h3>\n
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<\/a>Unique workarounds for the COVID-19 market shift<\/h2>\n