The Luxury Marketing Council of San Francisco, March 2016
I began teaching real estate classes in San Francisco in 2009. Since then the economic climate has changed in the Bay Area. It has gone from a market reeling from the meteoric impact of the Great Recession of 2007 to 2009 to the one of the greatest real estate booms in American History. This same transformation has taken place as well when it comes to the diversity of my students. Even agents in New York City, the market’s gold standard, have not seen the kind of growth The Golden Gate City has in the last seven years. While prices for homes, condos and co-ops have indeed soared, the most significant shift, in my experience, has come in the demographics of those selling the houses, rather than the price of the homes they sell. The number of Asian American, African-American, Latino and other minorities traditionally unrepresented in our business who enroll in my courses has skyrocketed. The number of men who want to enter the professional has also increased dramatically. Our industry is no longer almost exclusively the enclave of women, the majority of them Caucasian. I see this heartening expansion in all my classes, workshops and seminars—and when I am out in the field with other Realtors!
Interestingly, while the diversity of my students has increased, their reasons for getting into real estate have become more streamlined. From 2008 to 2012 my students were typically seasoned professionals who needed emotional support in a stagnant economy. Their reasons for being in the real estate game varied widely, and often moral or social goals dominated their business motivation. Since 2013, however, the students who have attended are consistently younger and more financially pragmatic: more often than not many are Millennials just out of college. They all seem to have the same common goal: they want to participate in an escalating real estate market which offers substantial monetary rewards.
This should come as no surprise. Most Millennials are trying to reconcile the high expectations of the futures promised to them during the Clinton years with the economic reality of contemporary America. Many of them have completed expensive educations while watching the economy free-fall. They enter the job market at a time when the competition for any job has become problematic—let alone one that truly helps them live the lifestyle they hoped would materialize. In this environment they also face the challenge of paying down their student debt before the first “Welcome to the AARP” Letter arrives in their mailbox! Research into Millennials shows that they are consistently materialistic and understandably concerned with money. A poll recently taken by a Harvard Marketing professor showed that 80% of Millennials want to be millionaires. Many young people view the real estate game, especially in booming markets like San Francisco, as a job that fulfills both their financial goals and their desire for independence.
Here is my concern: Is the current strength of San Francisco/Bay Area’s market strong enough to bolster the weighty expectations of Millennials?
As I discuss in my new book, Getting The Property SOUL’D : A Breakthrough System For Successful And Stress-Free Buying And Selling, new real estate agents may be in for a rude awakening in 2016. A struggling stock market, especially in the tech sector, with the Chinese Yuan being devalued and the European Union wobbling, is making even San Francisco buyers hesitant. In the last six months San Francisco Realtors have no longer been receiving above-market offers on every property they represent. The days of one-week all-cash offers on multimillion dollar homes may be unequivocally over—at least in the possible “Bear Market”. This emerging reality is going to require an entirely revamped mindset, with a paramount need for Realtors to learn more creative negotiating and marketing skill-sets and put them into practice.
Change is in the air, and this new diverse generation of younger and, yes, highly motivated and ambitious agents is just the right the one to enact that change. Technology is their great ally in this advancement. I was one of the first Realtors to start doing video tours of my listings, and the opportunities I see for continuing this path of digital marketing are endless. But these new professionals also need to remember that quality, not quantity, is vital to their success.
Social media, grassroots promotion, and advertising in technology-driven platforms are also all vital to the success of this new generation of agents. They just have to take a page from those who have come before them, and realize that true success may come more slowly than they expected.
Speaking of technology and social media, one point I want to make to this new breed of Realtors and all professionals in this arena: We live in an extremely visual culture. Beginning as children we read picture books, and in today’s high-tech world we continue to focus ever-more intensely on the graphic and the colorful. The question we in the real estate profession need to ask ourselves is: Why are there so many sub-par photographs nowadays in real estate listings? For example, by all means use Instagram, but make sure the photos you post are of the quality that would go in a brochure!
Diversity is here to stay. So is the quality. There is an old saying: “Work smart, not hard.” When you work smart, you never feel as if you are working too hard—things just kind of flow. At the least, that kind of satisfaction can make you feel like a million dollars—and put you on the right path to actually achieve your most ambition goals!
Paula Pagano, Broker Associate #592660/Top Producer at Hill & Co.