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It was the question I always dreaded as a young girl when my dad would talk to me. In an effort to get me to think, he would ask me, “What would you say if it was your daughter?” Oh man…I hated that question!
Today, it’s the question that drives my business. I was in a position to help my parents navigate the sale of property in another state last year. My knowledge of sale numbers and statistics as well as foreclosure filings and economic forecasts were invaluable in helping my parents make wise decisions. Each time I communicate with my clients, I ask myself, “What would I say if it was my mom and dad?”
In the past, real estate was like a lot of industries. It had its cycles, and while the timing of the cycles was sometimes hard to predict, the ups and downs were there like waves–following historic patterns. As I talk to other Realtors or stock brokers or financial advisors, the recurring thought that I hear is that these last couple of years have been like nothing anyone has ever seen. If we truly want to serve our clients, we need to abandon the maps that led us in the past and figure out a way to navigate through this unchartered terrain.
In 2006, in an effort to help my sellers understand what was happening in the real estate market, I pulled the monthly numbers for active listings and houses sold. I wanted to show how the law of supply and demand was not working in their favor by showing them the trend of increasing inventory coupled with declining demand. I pulled the number of the active listings and homes sold for each month going back to 2000 and created a line graph to show the relationship between supply and demand. I was surprised to see that these two lines actually switched places in April of 2005, but we didn’t start feeling it until August of 2005.
source: Northern VA Association of Realtors
The experience and knowledge that I have of the real estate market is invaluable to my clients in finding homes, setting prices, negotiating contracts, and working through issues that cropped up after contract ratification; that’s what Realtors do. Ever since that day when I created that graph, I have thought about my role as a Realtor in a completely different way. Certainly that experience and knowledge remain at the core of what I do, but I have many resources at my fingertips that can be like the proverbial canary in the mine–indicators of future trends.
I spend a considerable amount of time now researching statistics and understanding the numbers behind the numbers. While we can’t control the tsunami that hits, we can use the information that we have available to us to realize when the day-to-day waves are going to be interrupted by something bigger. We now know that the earthquake that occurred hundreds of miles away has far reaching consequences.
I want to shine a spotlight on these relevant statistics and trends and events that will have ripple effects. This is what this blog is for; this is what I would say if it was my daughter.
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