Real Estate 2013 Requires Stepped-Up Skills
The Orange County Register
January 6, 2013
It’s a brave new world. Much of the real estate market has gone from dead to hot, seemingly overnight – just as a budding economic recovery morphs into more uncertainty.
This is a tricky playing field to navigate, so we asked some smart business minds around town – from top managers to successful folks out in the field – about key skills needed to successfully manage the 2013 real estate markets.
This is a tricky field to navigate, so we asked some smart business minds – including top managers and successful folks out in the field – about key skills needed to successfully manage the 2013 real estate market.
Here are 10 items that should be on every Orange County real estate pro’s must-do list this year.
1. Know the new norm
Gary Watts, residential broker for Impact Real Estate in Mission Viejo, says 2013 success is tied to managing three key trends.
“One, there will be an acute shortage of (home) inventory during the February through May (prime home) acquisition season, and an agent will have to call upon the associates he or she worked with in the past to obtain ‘favors’ in knowing what they may have coming onto the market and if they can be given an opportunity to see and write a contract on the property first! These relationships will be critical in obtaining properties for clients. Second, see No. 1. Third, see No. 1.”
2. Stress execution
Chris Pollinger, residential brokerage First Team Real Estate¹s senior vice president for sales, says it won’t be easy to get the job done.
“Strategic creativity and execution will be key in navigating agents and clients through a market with incredibly low inventory levels and a record level of pent-up demand. When inventory levels are this low and multiple offers are the norm, it can be extremely frustrating for clients and agents alike. For a real estate manager in this market, it is their job to possess strategic creativity and outmaneuver the competition to serve the client. Execution will also be critical as the market picks up pace and leaves very little room for error.”
3. Manage expectations
Len Herman, 2013 president of the Orange County Association of Realtors and an agent with Keller Williams Realty in Mission Viejo, says offering reality checks with shoppers will be important.
“The first key skill will be managing the buyer¹s expectations. Our current inventory levels are extremely low. Homes are getting sold quickly with multiple offers. If the buyer is interested in a home, this is not the time to hesitate or make low offers. Buyers will also have to go through a very rigorous loan qualification process. The banks are very conservative with approvals as the loan has to fit into as very specific set of guidelines.”
4. Market more
Veronica Hicks, a condominium specialist and broker at Condos Etc., says a quick 2013 market only increases the need for salesmanship.
“While it might be more of a seller’s market, the expectation on price will be high, so marketing skills will be critical to get the most buyers at the highest price in the least amount of time. Both the buyers and sellers are stuck in the 2008 mindset, so agents will have to be great problem solvers.”
5. Master paperwork
Daren Blomquist, vice president at foreclosure tracker RealtyTrac in Irvine, notes that new lending rules and still-anxious lenders means agents must watch every detail of a transaction.
Managerial keys this year are “familiarity with the ever-changing documentation and paperwork needed to successfully complete a short sale,” in which a lender must agree to take a loss to close a deal, and “quick access to all the documents needed to refinance or finance the purchase of a new home or investment property.”
6. Practice flexibility
Tricia Esser, CEO of architects KTGY Group in Irvine, says acceptance of new ideas will be paramount this year.
“We need to be flexible, that’s the No. 1 skill necessary in this market whether it’s (designing) residential or retail real estate. We also need to be prepared to translate what the consumer wants and be quick to incorporate those into our designs. On the retail (development) side, we’ve tossed out all the old ways of thinking; in today’s world it’s about the viability of the deal. Retailers and developers are working even harder to get cities to support new ways of looking at developments.”
7. Price skillfully
Alan Reay, president of hotel consultancy Atlas Hospitality Group, says a recovering market requires a deft touch for the owners of big investment properties, like hotels — knowing just how much even a more optimistic consumer will pay.
For hotels, the managerial key “will be managing ‘yield.’ Occupancies are now back above pre-recession levels, so the best managers are going to be those who know how to maximize the average daily rate.”
8. Increase speed
Rand Sperry, co-founder and CEO of Sperry Van Ness, a commercial real estate franchisor in Irvine, says his side of the industry will be a bit cooler, requiring even quicker thinking and actions.
“Competition will continue to increase for quality real estate investment opportunities. It is also important to cultivate and maintain key relationships with your business partners, clients, associates and investors, as the truly good investment opportunities do not sit on the market long. Having these strong relationships will mean the difference between being in the game or watching from the sidelines.”
Jeff Ingham, senior managing director at commercial real estate brokerage Jones Lang LaSalle in Irvine, agrees:
“There is still a significant level of uncertainty politically, and hence, will ultimately affect the business climate. The key to success then drives to a tight business plan with the ability to adapt quickly. One of my favorite terms is to be ready for the opportunistic strike.”
9. Play to strength
Daniel Sheridan, president of The Irvine Co.’s retail center group, says property investors such as store owners will be well-served focusing on the power of their concepts vs. what the competition has in 2013.
“Online retail competition remains challenging, but we are focused on offering consumers more than shopping – but an overall entertainment and shopping experience. You can¹t touch cashmere from behind your computer screen; and you can’t see how a garment fits your body without trying it on in the store. And, what better way to complete your shopping experience off than by grabbing a glass of wine or bite to eat at a great restaurant conveniently located next to all the stores and shops?”
10. Use a long lens
Trent Brooks, chief operating officer at apartment owner Lyon Communities in Newport Beach, says that even fast markets still need to be managed with a grander focus.
Key for 2013 is “the ability to take a broad, long-term, strategic view and balance that with the short-term requirements needed to succeed in the current real estate market. Although things are more upbeat and incrementally improving, there remain many concerns related to tax policies and the continuing high unemployment rate – which is definitely diluting investor enthusiasm.”