It was a gorgeous May morning this spring when Serniqua Dougherty, an agent with the boutique residential firm Manhattan Home Delivery, sat with other graduating students of the Fashion Institute of Technology inside Radio City Music Hall. The right of passage marked not only earning her undergraduate degree after years of dedication and hard work but her transition into New York City real estate.
“I quickly realized my jumpstart would be made through marketing, marketing, and more marketing. Basically cold calling, cold mailings, opening up the Yellow Pages and looking up addresses for people in areas in which I wanted to work and calling them. I believe, if you get someone to read your material and not throw it out as junk mail, that’s your opportunity,” says Dougherty, who obtained her real estate license last year.
For freshly minted salespeople like Dougherty, the real estate environment in New York has never been more competitive. As of last month, according to the Department of State Division of Licensing, there were 41,575 licensed salespeople throughout the five boroughs, up from 24,727 five years ago.
Meanwhile, there were 24,209 licensed real estate brokers, an increase from the same period five years ago, when there were 19,393 in the city. And while there is a difference of opinion over the state of the market, here are some tips from agents who have survived both the bulls and the bears.
Realize sales take time
An increase in the amount of inventory on the market today has created a challenge for sellers, says Dottie Herman, president of Prudential Douglas Elliman.
Herman suggests that agents be selective about taking listings. “A lot of them take on properties that are at the high end of the market and I would have a heart-to-heart with the seller about what their expectations are,” she says.
Herman believes, in the current market, a seller needs to be willing to allow six months for his property to sell and encourages brokers to “not even touch” a three-month listing.
“In today’s market, most properties are selling [after] an average of four and a half months,” says Herman. “People are taking longer to make a decision today, even if your property is priced right.”
Selling seems to be just as slow for new condo developments, which have hit the market in large numbers.
Highlyann Krasnow, executive vice president of the Developers Group, which specializes in marketing and selling new developments, has seen a shift in the last six months.
“We really are having the same amount of people at open houses, but people are taking two or three appointments to make a sale,” says Krasnow, who oversees some 70 agents.
“I started in the business back in 2000,” she added. “Before, the sales just came to you and you didn’t have to do anything. Now, you have to really work for it.”
Get ready to negotiate
In an environment where a seller obtaining full asking price isn’t always guaranteed, there is the overall opinion that negotiation and even concessions on both sides is often necessary to seal a deal.
“Now, it is more of a banter between two attorneys and it is a deal that is created out of mutual compromises,” says Thomas Di Domenico, a senior vice president at the Corcoran Group who has been in the business since 1981. “It is important to have a broker and attorney who are at the top of their game.”
Krasnow of the Developers Group notes that for new condo projects, developers who two years ago had people lined up to buy apartments are now open to the concept of negotiation — but not on all fronts.
“Most developers are still not willing to negotiate the price, but some are willing to negotiate other terms such as transfer taxes and closing costs,” she says.
Coddle your buyers
Brokers agree buyers today have far more options than they did a year or two ago.
JoAnne Kennedy, COO of Coldwell Banker Hunt Kennedy, believes a broker’s time is best spent only showing a potential buyer the cream of the crop properties.
“You need to show the very best first,” she says. “If you show the worst, then they will think as a buyer, ‘oh, these properties keep getting better and better,’ but if you show the cream of the crop first, then everything else pales in comparison and that prompts a quicker buying decision.”
Kennedy said in order for brokers to keep up-to-date as apartment inventory grows, they should see as many properties as possible. “I suggest that a broker should see at least 30 apartments a week so they really know the inventory,” she says.
Herman of Prudential Douglas Elliman advises brokers dealing with buyers to encourage them to “just make an offer.”
“With the seller, sometimes the first offer is the best one and they don’t know it,” she says. “And if the buyer doesn’t like the counteroffer from the seller, the broker can have the buyer place a standing offer.”
Currently, building relationships even with those individuals who don’t buy may also pay off in the future, says John Reinhardt, president of Fillmore Real Estate.
“Before, the buyer who bought an apartment was given all the attention and the others were neglected,” he says. “These days, every potential customer who walks in the door, you should develop a relationship.”
Pick your shots
In life, it is often said you only have one chance to make a first impression and in real estate, brokers agree that means always showing a property at its best, beginning with its entrance into the market.
Corcoran’s Di Domenico said sellers are now realizing the cost of staging — which involves having a professional come in to make an apartment more presentable, and which many brokers dismissed during the hot market when anything would sell — is now worth the investment.
“You have to bring the seller into the thinking that the property has to show like a showplace, and it has to show like that throughout all of the showing schedule,” says Di Domenico.
Helping a client out with other parts of the real estate transaction is also key for a broker, he says.
“In today’s market, the more services a broker can offer — an experienced attorney, a home stager, a home interior designer, mortgage broker — the better assurance you have the transaction will go smoothly,” he says.
Herman of Prudential Douglas Elliman said brokers should still invest significantly in marketing, even if there is less money to go around in a slower market.
“I don’t believe you should cut out marketing. It is probably even more important today than it was a year ago,” she says. “A year ago, properties sold and marketing may not have made much of a difference. Now, I think, marketing is very important.”
Reinhardt of Fillmore agrees with Herman, but points out that not all marketing needs to cost a bundle. “The greatest way to market a property is to put it on the Internet. It’s so affordable. People today are going from ink to links,” he says.
Find niche markets
When Toby Klein, executive director of sales for Dumbo building owner and developer Two Trees Management, began selling real estate, it was the mid-’80s and interest rates were hovering around 18 percent.
For Klein, her bread and butter wasn’t earned on higher-end clients, but through deals with first-time buyers.
“Twenty years ago, I worked a lot with first-time buyers, and I was comfortable helping them. I feel they needed the most help and it just happened to pay off for me because they have stayed with me and they grew and I grew.”
She believes that even in today’s market, establishing a relationship with a first-time home buyer can pay off for decades and multiple sales to come.
“Most brokers who are just following the commissions will spend very little time with that first-time home buyer if they are just looking to make that multi-million dollar sale. That’s a mistake,” she says.
Reinhardt said another often-overlooked market involves the thousands of immigrants who settle in the city annually.
“The immigrant market and the blue-collar market are two of the hottest markets right now,” he said. “There are so many people who are moving to New York who still want the American dream.”
For newbie agent Serniqua Dougherty of Manhattan Home Delivery, her strategy so far has been to diversify by dealing in both sales and rentals.
“Doing both allows me to be open to both,” she says. “Rentals is something you can always do to get a check and keep money in your pocket because there is always that student who needs an apartment or that person who just relocated to the city.”
Cathy Hobbs is an Emmy Award-winning journalist and interior designer.