Residential real estate firms and brokers need to think thin
May 08, 2009 01:10PM By Candace Taylor
From left: Hall Willkie, Diane Ramirez, Dottie Herman and Barak DunayerNew York City real estate is headed for momentous changes, for better or worse, industry leaders say.
"We're not going to recognize our industry when we're through these next few years -- in a good way," said Hall Willkie, president of Brown Harris Stevens, speaking on a panel discussion last night as part of REBNY's 2009 Real Estate Master Series.
Other panelists included Diane Ramirez, president of BHS sister company Halstead Property; Dottie Herman, president and CEO of Prudential Douglas Elliman; and Barak Dunayer, president of Barak Realty. Jeffrey Appel, senior vice president and director of new development financing at Preferred Empire Mortgage Company, moderated the discussion.
Willkie said he believes the current downturn will make the industry more professional by weeding out unskilled agents, and added that the tough times present an opportunity for real estate brokerages to revamp their business models, making them leaner.
At BHS, for example, he said he's focused on belt-tightening measures that wouldn't impact sales, like "getting rid of $10,000 on coffee."
He said: "We're running better ships."
In flusher times, Halstead's Ramirez said, the deals came in so fast that brokerages often didn't have time or motivation to innovate, or look for ways to streamline the business model. "You were just on a roll," Ramirez said.
The current market "forces you to focus," Barak's Dunayer added, "like a fat man who got a heart attack, then started to exercise."
In previous years, "money was coming in so fast, even bad agents could make sales," he said. That has now changed. "We're back from being order-takers, to being real estate brokers."
Still, times are tough in the meantime. Willkie noted an example of one longtime agent who told him she only has only enough money left to pay her bills for two months.
"How badly are people going to be hurt until we get to that new place -- that's what I worry about," he said.
The panelists pointed to new development as a trouble spot in the market.
"You can't get financing for anything that isn't 50 percent sold, and in some cases, 70 percent," Willkie said.
Luckily, there are few projects in the pipeline, they said, preventing a massive pileup in inventory.
"Development is going to be very quiet if not non-existent for the next three years," Ramirez said.
Brokers are also faced with the prospect of more co-op board turndowns, and need to work on doing more legwork to spot qualified buyers, Dunayer said.
"We need to get better at qualifying people," he said. "We can't just wing it anymore."
They also emphasized that there are still opportunities in the current market -- it's just a matter of brokers finding them.
Elliman's Herman said that agents should "figure it out, because there's always opportunity."
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Comments
Anonymous
Silly me, when I started reading this story I was thinking wow this is great. Change in the industry must mean they think we're going to get an MLS, get rid of agents/brokers who use bait and switch tactics, devise a standard for measuring square footage, replacing the "leadership" at REBNY etc etc. But silly me, they were talking about $10,000 worth of savings on coffee. IDIOTS!!!
Comment #1 Posted By: Anonymous 05/08/09
Anonymous
Silly me, too- I thought that they'd have a panel of experts, not horrible examples of the NYC debacle- there's not a single person that has a CLUE. There will be changes, hopefully beginning with the elimination of REBNY, and the horrible people offering "input." Idiots, absolutely.
Comment #2 Posted By: Anonymous 05/08/09
Anonymous
It's nice to see them admitting that they were nothing but order takers. Wonder if they admitted that when they took an obscene commission from consumers. Public, take heed- you're dealing with losers.
Comment #3 Posted By: Anonymous 05/08/09
Anonymous
I agree with all of you. In this day and age there really is no need for brokers. You could have a standardized pool of buyers, renters, and sellers on an online forum, a myspace for realestate in NYC, if you will. Brokerage is just one of those careers that have been rendered obsolete...
Comment #4 Posted By: Anonymous 05/08/09
Anonymous
What we need is a real MLS that makes the playing field equal for all agents/owners/sellers/buyers, with comps available to everyone...transparency. And a real governing agency that enforces rogue agents and unprofessional practices, rather than turning a blind eye to the firms who pay their membership fees. This industry needs more role models and less cocktail parties.
Comment #5 Posted By: Anonymous 05/08/09
Anonymous
The days of sitting around waiting for commissions to fall in your lap are over. Time for brokers to wake up and get training for an alternative career path.
Comment #6 Posted By: Anonymous 05/08/09
Anonymous
#5, agreed, but what if the "rogue" agents in serious need of fines and/or suspension RUN the companies, as is the case in NYC? Starting with the lineup above?
Comment #7 Posted By: Anonymous 05/08/09
Anonymous
I agree with the comments. I'm 2yrs in the real estate field. I came in & viewed what was going on & disliked it. 2yrs later after seeing these professionals driving big cars, travelling the world, having people accept them & their ways I'm in the process of giving in and becoming the average typical real estate professional. I haven't seen any legitimate, professional r e professionals with ethics, morals or even good health. I think that's the life of the nature of this beast. Sad but seeming to be clearly so.
Comment #8 Posted By: Anonymous 05/08/09
Anonymous
You people are obviously resentful sellers that are too damn incompetent to sell your apartments "if" you actually own by yourselves. #4, I challenge you to sell your apartment if you indeed have one on your own. After getting fed up you'll give it to us pros. #6 if you think I sit around you must be the one that sits around and looks at the clock to see if it's 5:30 pm so I can go home and watch cable. We work harder and longer then most careers but you wouldn't know since you're a salary person who's counting the days until Friday (so 80's). #8 I agree there's a lot of scum bags and I work with a dozen of them but this is a huge city with millions of people, those dirty brokers are a few compared to us damn good ones, hurah!!!!
Comment #9 Posted By: Anonymous 05/08/09
Anonymous
It wasn't a "resentful seller" that called #10 an "order taker." It was the BHS genius in the article that ratted you out publicly, #10. Sellers and buyers have known it, but hardly expected the "leadership" in NYC real estate to admit it. What a group.
Comment #10 Posted By: Anonymous 05/08/09
Anonymous
I read every post here and it seems like people are straight haters! If you really believe deals just fall on peoples laps then you should try being a broker and find out. Prices are outrageous because the demand is high. You got a problem... stop talking shit and make $$$ bitches
Comment #11 Posted By: Anonymous 05/08/09
Anonymous
You should be directing your vitriol to Mr.Willkie, not commenters, #11. Get a grip.
Comment #12 Posted By: Anonymous 05/08/09
Anonymous
I too am a broker and there are a handful that make real good money. What these negative posters do not realize is there are many more brokers that revolve in and out of the business and make little to no money. Granted it is not exactly brain science but so what- you need to hussle and work hard. If you are successful it is a great business. I too agree the business is full of shady characters but then again so is law (and I am a former atty), politicians, banking etc I would like to know what each of you do.
Comment #13 Posted By: Anonymous 05/09/09
Anonymous
I'm a broker on the east end, and wonder why the people in the article, such as Ms. Herman, expect their "unskilled" agents (per Willkie) to "figure it out". What horrible leadership/training- what the hell were they doing with "unskilled" agents??? If they aren't doing thorough training, they are doing a HUGE disservice to the public- and they don't even recognize their own complicity!
Comment #14 Posted By: Anonymous 05/09/09
Anonymous
I have been a broker for many years, but real estate is fun when youre making money only, instead of listening to these panelist know it all that suck up their living out of their agents without doing anything other than making stupid unwanted coments here, just get another job while the crisis rides its course and when things get better get back into the business, a real esatate license is easy to keep and even a monkey can obtain one, good or bad agents nobody is making any money nowadays period! So leave the business for now, make money and comeback in a few years thats all.
Comment #15 Posted By: Anonymous 05/10/09
Anonymous
#15 I like your comment. Can you suggest however what businesses to consider during the hiatus? Thank you.
Comment #16 Posted By: Anonymous 05/11/09
Anonymous
I am a physician and after a real estate agent took $5000 from me for showing me a few apartments (and I chose one) in about 2 hours worth of work (yes, he made a few phone calls too) I actually thought that I wasted my time for the previous 12 years in college, med school and residency training. That individual took in less than half a day more than I make in 2 weeks of work that includes many nights in the hospital of very hard work... I actually thought to do this real estate thing also to pay off my $150,000 med school loan that will take me 1-2 decades to pay off doing my regular work...
Comment #17 Posted By: Anonymous 05/11/09
Anonymous
To commenter #17 the health care industry is far more absurd than real estate. Go to cnn.com. Just this morning people are talking about how physicians say they need to do re-test because they could "not find" lab results on patient x or y and now need to do an MRI or an X-ray or what have you. Sorry you had to pay for school but no sympathies here! Honorable real estate agent.
Comment #18 Posted By: Anonymous 05/11/09
Anonymous
From one who has paid two 6% real-estate commissions in four years, give me a break! My Agent didn't even find my Brooklyn condo, I did on the internet! He just took me there because I was from out of town. What a freakin waste of money. My beef is also with Real-Estate Attorneys too. WTF, I paid three Attorney fees, my own, the Sponsor, & the Bank. They completed "Boiler Plate" rubber stamping paper work since the condo had over 200 apts. You're all a rip off! Now you'll really have to possess skills in this market.
Comment #19 Posted By: Anonymous 05/11/09
Anonymous
Everyone complains about the broker #17 & 19, If you don't want to use a broker and you have lots of extra time then you're free to do it on your own. You can (try to) do other things to save a buck: cook, dry clean, fix your brakes, wash your car, diagnose yourself, be your own attorney, make your own clothes, wine, cheeses, and preserves - all on your own. People who have a life or want a piece of mind, hire "professionals" to do these things.
Comment #20 Posted By: Anonymous 05/12/09
Anonymous
Here here #20. Their also alot of sore asses out there because they can't rip off the public with their ludicrious prices. Ofcourse the occasional broker represents them as well. Smart brokers do have skills, do know how to make an honorable living and most importantly don't list every piece of overpriced garbage FSBO's have,
Comment #21 Posted By: Anonymous 05/12/09
Anonymous
#21, incase you missed my sarcasm. I am a broker. I'm not going to beg or justify my services. I just wanted 17 & 19 to know that.
Comment #22 Posted By: Anonymous 05/13/09
Anonymous
I've been agent for almost a year. I've made so much money from working hard but most went to Barak who nickled and dimed me for everything. He is greedy, lazy and dishonest which is why I left. Willkie is right. Nobody is going to recognize this industry after the recovery. We agents will keep most of the commissions and pass the savings on to our clients. Barak, Willkie and the rest of them better look for another job.
Comment #23 Posted By: Anonymous 05/18/09