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Real estate in tough times: How to thrive despite economic challenges

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Finding success in the fiercely competitive world of real estate requires dedication, determination, and a strong work ethic. Gone are the days of multiple offers over asking on a days-old listing.

Seasoned agents know winters are typically flat for a myriad of reasons, but this year is different. The market has slowed to a snail’s pace as prospective buyers and sellers wait on the sidelines with bated breath to see what 2023 has in store. 

While none of us have a crystal ball, it’s all but certain that high-interest rates, recession worries and global unrest will continue to play a role in consumers’ decision-making next year. 

In a recent report, RBC Economics said its aggregate affordability measure is at its “worst-ever level.” In some cases, the increase in the minimum qualifying income needed to purchase a typical home has been unprecedented.

“It’s never been so unaffordable to buy a home in this country,” says Robert Hogue, senior economist with RBC.

Nationwide, home resales have decreased by 36 per cent, with even larger declines in B.C. and Ontario, reaching levels lower than before the pandemic.


No guaranteed income


Many in the industry have been here before, but the stillness is unnerving for others. Realtors don’t have a guaranteed income. Their paycheque is dependent on that commission. 

For Edmonton realtor Sara Kalke, the current climate is all too familiar. Alberta is one of the world’s top oil producers, and its economy pulled back sharply when oil prices slumped between 2014 and 2015. The downturn hit the real estate market hard.’

“At first, you think it’s not really going to be anything. And then when the market stayed quiet for week after week after week, I started to get scared,” Kalke said. “And realtors were all looking around like, is my phone broken? What’s happening?”


Strategies for success


As the panic began to set in, Kalke reached out to industry veterans who had weathered similar economic storms. “The two biggest things they said were, one, bad markets are phenomenal opportunities for great agents, and two, don’t stop working,” Kalke recalls.

“It was a time to become even more knowledgeable about economics. We would look at oil prices daily, markets, and trends and read the news. When people asked me what was going on, I could give them the big picture.” 

She said her newfound knowledge provided a sense of certainty for her clients, and she seized the opportunity to be somebody who “just didn’t quit.”


Focus on your clients


Kalke remembers many agents shrinking into what she calls “a fear turtle.” She says that instead of working harder, those agents hardly worked.

“A lot of agents pulled their marketing, they cancelled their ads, stopped coaching, stopped reaching out to their clients,” she says. Or they went in the opposite direction, Kalke explains, and became “too aggressive and too salesy” with their clients. 

Any agent who has been around the block will tell you that exceptional customer service is at the heart of their success story. “The biggest thing you can do is talk to people,” Kalke advises. 

“People have been starved for human connection. Meet with them, and reconnect, but not with an agenda. Have their local market statistics memorized, and I mean memorized. Generalizations don’t build trust,” she emphasizes


Opportunity in adversity


Meredith Kennedy, broker with Royal Service Real Estate in Millbrook, Ont. agrees. “(Clients) need honest and trustworthy realtors who have integrity and will guide them with knowledge, expertise and patience.

“People still need to sell; people still need to buy. It’s just helping them navigate what fair market value is right now,” Kennedy affirms. 

Kennedy believes that going the extra mile for a client makes you stand out. While reflecting on the buying frenzy induced by the pandemic, she says, “It shook everybody’s world, and then the real estate world went completely nuts.

Kennedy is optimistic about current conditions and says a balanced market allows realtors to do their jobs properly. “You have time to do a home inspection, which is crucial. They always should have been, like I did pre-listing home inspections for all my listings. I think it’s crazy that people were buying stuff and not knowing what they were buying.”


Experiment with something different


Luc Hartwick is the general manager at MoveSnap, a Canadian proptech company that provides a moving concierge service realtors can offer their clients. 

Hartwick says, “The industry is undergoing massive digital transformation and rapid changes due to technological shifts, livability and affordability shifts.” 

He adds it’s critical to differentiate yourself from the competition, “It’s as important as ever given market conditions.”

He believes proptech offers that opportunity, “It could be a tool to help professionals get started and level up their business to make it through those humps more easily…but the elements of human experience have to be at the center of these technological changes.”


Mental preparedness for the grind ahead


Sara Kalke’s best advice? “Be prepared for it to feel like a grind, be prepared mentally for tough conversations and hard days. And those tough conversations are not just going to be the sellers, but with buyers too.”

She tells realtors, “find things that fill your cup because your job won’t anymore, not the same way it did in a hot market.”

At the end of the day, Kalke is optimistic about what 2023 will bring, “I might be wrong in this,” she cushions her prediction for the new year, “but I think some will be surprised at how busy it’s actually going to be come spring.”


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