I am saying the market is slow. My partner Mitra is saying the market is slow. Mike Ferry is saying, forget the market and focus on what you can do to produce at a high level.
I take Mike Ferry seriously. I still want to look at the market and understand what is going on.
Here is an excerpt from the April market report that summarizes the current situation: “While sales were up year-over-year in April, it is important to note that they remain well-below April levels for much of the past decade. Many potential home buyers arguably remain on the sidelines as they reassess their options in light of the OSFI-mandated two percentage point stress test on mortgages. Longer term borrowing costs have trended lower this year and the outlook for short-term rates, for which the Bank of Canada holds the lever, is flat to down this year. Unfortunately, against this backdrop, we have seen no movement toward flexibility in the OSFI stress test…”.
If the market is slow, what can you do to maintain or increase production? What you can do is you look for opportunities and this report is a good place to start. For example, for your Just Listed/Just Sold calls, look for:
- Areas and property types with appreciation levels significantly above the average.
- Areas where the volume of monthly sales is higher than the average (page 3 of the report).
- Price points where the number of sales is higher than the average. For this metric the gold is in the $700,000 to $900,000 range. (page 2 of the report).
Also, the report is what you study at least once per month. Internalize the numbers and let you sphere and past clients know what is happening. Give them your opinion on the market and ask them for theirs. They will appreciate this information. They will want to hear from you again next month and after you give them their informational value, ask for referrals.
Stop relying on the market as a gauge of where you are supposed to be as an agent. If the market dipped by 20%, it does not mean that your income should follow. Reassess what you do daily and start increasing the number of contacts you make every day. Tighten the discipline with which you approach your day. Stay focused on your goals and don’t worry about things you can’t control.
I spent some time with the Mike Ferry coaching program in the past and had a great coach by the name of Aleksey Julanov. He has been an active real estate agent in Calgary, Alberta for the past 9 years. When the market in Toronto started shifting, I asked him a question of what we need to do as a team to increase our production or at least to stay at the same level. His marketplace has been seeing declining prices for about 5 years at that time. Aleksey did admit that it was an exceptionally tough year for him when the market started trending downward, but after making adjustments to his work practices, continually working on improving his skills and increasing his prospecting time, he started setting new records both for business volume and the annual Gross Commission Income (GCI).
Personally, I have not experienced a declining real estate market in the past and it was important for me to know that not only was it possible to maintain our GCI at levels that we enjoyed for much of 2016, 2017 and 2018 in the GTA, but also, it was possible to grow even in the toughest of markets.
TREB is saying that there are more than 50,000 agents holding a license in 2019 and despite challenging market conditions this number is still around the same mark. Take a look at the report. In the month of March, there were under 15,000 new listings and in the month of April around 17,000. This means that about 70% of licensed agents are taking no listings over a 30 day period and this is assuming that the rest of the agents are taking 1 listing per month only - this of course is not the case. Most people in this business go hungry. This is an example of how you can look at the report numbers and use this information in your prospecting calls, your conversations with sphere and your listing presentations. People will ask you “How is the market?”, and you will need to decide to either get “salesy” with them or to give them factual information.
Current market conditions are favourable to working with buyers and investors as well. I firmly believe that taking listings and controlling the inventory is foundational for any real estate agent that wants to make big numbers. At the same time it is foolish not to spend more time on refining your strategies to address the needs of buyers and investors and helping these groups take advantage of the market conditions. These clients will nicely supplement your annual income and with good follow up practices, they will turn into listings a few years down the road.