Last week, we concluded that today’s rapidly growing housing prices likely won’t result in a housing market crash like we saw in 2007. This week, I want to offer some tips for what Realtors should be doing to prepare for a crash anyway, as a smart business practice.
First, let me review what I see as the strengths of our local housing market.
Why the South Florida housing market has more room to grow
During the pandemic, Florida has been a destination for people looking for a new lifestyle, motivated by the flexibility of remote work opportunities.
In 2021, Florida was in the top five states to see more people moving into the state than out, according to the National Movers Study. Those new Floridians named retirement, lifestyle and family as their top reasons for moving in.
South Florida also has a shortage of housing options. That means the super high prices we’re seeing aren’t overinflated as much as they’re realistic based on the availability of supply. Read more about this in last week’s post.
While I anticipate the South Florida market continuing to grow in the near future, I’m a proponent of being prepared. Here are my tips for how Realtors should prepare for a housing market crash.
Invest in your own education now
When the market is hot, even Realtors without a lot of knowledge can thrive. With a market as vibrant as South Florida, it’s tempting to become complacent and start believing that closings will always happen easily.
Don’t fall into that trap. At Royal Empire Realty, we believe that Realtors should always be investing in themselves. When sellers can afford to be choosier, they will pick the Realtor with the most tools to get the job done. Position yourself as the best option now, and you’ll be prepared for whatever the market brings.
Keep your leads and business contacts fresh
It’s never a good idea to have only one way to generate new sales, no matter how lucrative that method is. Realtors who stay afloat no matter the market conditions do so because they are always actively cultivating diverse sale leads.
Similarly, it’s important to keep exploring new business contacts as well. Never assume that you’ve met everyone you need to keep your business thriving. Instead, join networking groups. Keep yourself open to new business ideas. Make sure your clients are a healthy mix of sellers and buyers with diverse economic situations.
You never know who you’ll need to know to stay agile in a changing market.
Be prepared to adjust your business model
In the last housing market crash, the Realtors who survived were able to pivot to new business models. Many capitalized on the number of short sales that were suddenly happening, even if it wasn’t part of their business before.
If you’re used to selling luxury homes at a premium, don’t be too proud to learn something new if that income source dries up. Change is inevitable. Position yourself to adapt to it.
Don’t overextend your own investments
At Royal Empire Realty, we encourage our agents to invest in real estate as a way of gaining hands-on experience that’s valuable to their clients. However, if your personal investment portfolio is overextended, you’ll have less flexibility to pivot your business in a housing market crash.
Be wise with your own money so you’re ready to help others in a downturn.
Royal Empire Realty is a brokerage that values our Realtors and invests in their futures. Join us, and begin building your business Empire.