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"Trends to Watch"

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Stefan Swanepoel Photo
6/1/07 Interview with Stefan Swanepoel

RealtyU Group
8 Argonaut, Suite 100
Also Viejo, CA 92656

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Changing Trends in Real Estate

  1. Trends are moving so fast that Swanepoel felt it necessary to follow his first TRENDS Report in 2006 with another in 2007; he plans a new report annually; each report is a snapshot in time and a roadmap for the next 12 months.
  2. The changes between 2006 and 2007 are largely refinements that are evolving in technology, the Internet, multiple listings, association activities and large RE company practices.
Legacy from 2000-2005

  1. Following one of the strongest real estate periods in history, key lingering impacts will affect the market negatively for another two to three years.
  2. So many new people flooded into the industry during the boom that the average number of transactions per agent has declined; the slowdown in real estate has pushed transactions per agent further down.
  3. A decrease in housing prices (more pronounced in certain areas) also depresses the profitability of agents and brokers.
Challenge for Associations

  1. Associations need to define their mission in terms of helping their membership cope with a changing industry.
  2. Associations should answer questions such as: how to survive if MLS disappears; what the Internet and multi-brand ownership are doing to members; how to relate to non-agent RE specialists and non-traditional RE business models.
  3. Because the industry is dynamic, REALTORĀ® organizations must be, too; associations must come up with creative ways to restructure and reposition themselves in order to remain relevant for members.
Globalization Tend

  1. High foreign immigration into the US presents a big opportunity; home ownership figures are at all-time highs, and most immigrants and minorities buy strongly into the American dream of owning a home; potentially 60% of real estate business could be in minority markets.
  2. The RE industry has not resolved how best to serve minorities-language and cultural issues matter; there is room in the marketplace for companies to fill the need.

  1. A number of regional brands-e.g., Long & Foster, Windermere, John L. Scott, etc.-are strong in one state or several states.
  2. The three leading national brands are Coldwell Banker (known for large offices and acquisitions), RE/MAX (the most entrepreneurial) and Century 21 (best known by consumers due to franchising), but other brands are upcoming in national recognition, including Sotheby's, which did not even start as a real estate brand.
  3. Online brands are also impacting the market; many of these are not brokerage companies at all; examples of online brands are, HomeGain, Zillow and HouseValues.
  4. With so much fusion going on in real estate, branding will be exciting over the next few years.
Keeping Pace with Consumers

  1. Use of the Internet, which has opened a vault of information, makes today's real estate consumers much better educated than in the past.
  2. Too many agents, especially the million or so newcomers to the industry, are not adequately prepared technologically or even in real estate skills; at the most, only about half a million of all agents are fully qualified with sound skills and experience to do an above-average job.
  3. The industry needs to do something about the 1.5-1.8 million agents who are borderline; one obstacle that has to be overcome is the mindset (sometimes unconscious) of agents who would rather be comfortable in their old routine instead of learning ways to improve.
  4. Improving yourself is critical to achieving success in real estate-get a coach, enroll in a mentoring program, read a book; a coach or mentor can guide you along a new path and hold you accountable.
Web 2.0

  1. The term signifies the second generation of Internet activity; the first generation, beginning in the mid 1990s, involved the restricted use of web sites by real estate agents to present information in "library" fashion.
  2. Dotcom technology that went underground after the dotcom crash has resurfaced in the last two years in applications that allow people to use the Internet to interact and transact.
  3. Web 2.0 represents e-commerce in its totality with bigger broadband, cheaper hardware and open source-software.
  4. The Internet is taking over the real estate transaction and will reshape the industry completely.
Favorite Web Sites

  1. Wikipedia offers a wealth of information.
  2. Some blogging sites provide business-to-business contact within the industry [e.g., the Society's National Real Estate Industry Blogsite].
  3. News on trends is available at Swanepoel's
  4. is a free site offering tools and information to people new to the industry; novices can apply for grants of several hundred dollars and become eligible for awards of much larger amounts.
Business Models for the Future

  1. The primary drivers are reduction of transaction costs, elimination of repetitive data entry, enhancement of transparency of transactions and improved user-friendliness-all consumer directed.
  2. Any business model that addresses these core points can potentially do well in the market, including existing models that reengineer themselves; these face the challenge of overcoming internal resistance.
  3. New models are likely to emerge that factor in annuities, discounts and doing business virtually; real estate could see innovations of the magnitude of a YouTube, MySpace or Google.
  4. The winners will be shifting from a sales mentality to an advisory mentality, and from one-time transactions to for-life transactions.
Contact Information for Stefan Swanepoel:

(v) (949) 349-9394
(f) (949) 349-9392

Real Estate Sites & Tools in this Briefing:

Swanepoel's RealtyU Group:
Online real estate brands:, and
National Real Estate Industry Blogsite:
Swanepoel on trends: