Mike Simonsen is the founder and president of real estate analytics firm Altos Research, which has provided national and local real estate data to financial institutions, real estate professionals, and investors across the country for more than 15 years. An expert trendspotter, Mike uses Altos data to identify market shifts months before they hit the headlines.
In this episode of the Top of Mind podcast, Mike Simonsen sits down with Brian Boero, co-founder of real estate branding and strategy firm 1000watt, to talk about how agents and brokers can thrive in a difficult market. Brian gives us an inside look at what the top real estate brands are saying to consumers now, offers advice for messaging in a down market, and shares insights into what 1000watt’s consumer surveys can tell us about market needs. He also discusses why consumers gravitate towards a “signal of clarity” in challenging times, and how real estate professionals can best provide that signal.
About Brian Boero
Here’s a glimpse of what you’ll learn:
- Why a difficult market is your best opportunity to grow, gain share, and differentiate
- What some of the great real estate brands are saying to consumers now
- Why in a difficult market, consumers gravitate towards a “signal of clarity” (and why market data is that clarity!)
- What 1000watt’s consumer surveys tell us about what real estate consumers need from their agents/brokers
- Which advertising messages work better in a down market, including real estate marketing cliches to avoid
- The biggest change coming for realtors in the next few years
- A surprising signal that realtors are gaining trust
- How great brands differentiate themselves in real estate
Resources mentioned in this episode:
About Altos Research
The Top of Mind Podcast is produced by Altos Research.
Each week, Altos tracks every home for sale in the country - all the pricing, and all the changes in pricing - and synthesizes those analytics to make them available before becoming visible through traditional channels.
Schedule a demo to see Altos in action. You can also get a copy of our free eBook: How To Use Market Data to Build Your Real Estate Business.
Welcome to the Top of Mind podcast from Altos Research. This is the show where we talk to real estate industry insiders and experts about the trends shaping the market today. Enjoy the show.
Mike Simonson here. Thanks for joining me today. Welcome to The Top of Mind podcast. For three years now, we've been, we've been sharing the latest market data every week in our weekly Altos research video series with the Top of Mind podcast. We're looking to add context to the discussion about what's happening in the market from leaders in the industry every week. Of course, El Altos research tracks every home for sale in the country, all the pricing, all the supply and demand, all the, the changes in that data. And we make it available to you before you see it in the traditional channels. People desperately need to know what's happening in the housing market right now. The market was frozen so solid last fall, and then now surprisingly, that landscape has has changed again. So if you need to communicate about this market to your clients, go to altos research.com.
Book a free consult with our team. We can review your local market and how to use market data in your business with your buyers and sellers right now. Alright, let's get to the show today. So I have a great guest today, Brian Boro, the co-founder of Thousand Watt. Brian has been in real estate media marketing and technology since 1997. One of the few people who's been around this space longer than I have, and is the founder of Thousand Watt, a branding and strategy agency focused on the housing market. many of you in the industry will remember Brian from his time as CEO of president of Inman. He was also CEO of V R E O, where he created e-signature and document management software. Brian is, he's got a creative and strong views on the real estate industry and about how consumers act and interact with the industry. And, and I, I am looking forward to exploring all these areas beyond just the data today. So, Brian, welcome.
All right. Well, Mike, thank you. And yeah, I have been around a long time and I think for most of that time I have followed what you're doing and relied on you and Al Altos to kind of know what's going on. So you know, mutual admiration society here.
Yeah. Terrific. Yeah, thanks for, thanks for joining today. So here, here's what I've been thinking about this conversation we're gonna have today. So you're a professional communicator, really. You're, you're, you teach people in the industry how to communicate with buyers and sellers, and I wanted to have you on the show so we can talk about that. You know, you know, a lot of what we do with people who use altos is like, we have the data but how do you com, how do you communicate about the data? How do you use the data? And so you know, there's all kinds of trends with buyers and sellers, with marketing, with, you know, technology and things that I wanna cover about the context. And, and really I'm, I'm very much interested in, in that as our, as our over arch goal for our conversation today. So if you would, let's start with a little bit of your, your background, how, how, how you developed your expertise, and then tell us a little more about Thousand Watt.
Sure. I got into this business in 1997 when I was very young, and I was fortunate enough to get hired by Brad Inman. And he gave me entirely too much responsibility at a very young age. And I was there eight years and learned a ton about the real estate industry, was a great vantage point to observe this endlessly interesting business in which we work. And learned a lot about media, learned a lot about marketing tech, and that was really what shaped my outlook on a lot of things in this business. And from then went and ran a small tech company that at the time was building sort of early cloud software for, for, to be simple about it, and then started thousand lott after that. And Thousand Watt is, as you said, it's a, a branding and strategy agent agency. You could call us a creative shop, but in a nutshell, what we do is we help companies that are inside the industry, whether they're big real estate brands or real estate brokerages or companies from outside kind of the brokerage industry, whether they're big prop tech companies, mortgage companies, title companies, try to articulate their value proposition more clearly sharpen their marketing, develop their brand be a better version of themselves, so to speak. so that's what we do, and we've been doing it for about 15 years now. Yeah.
And you've got some of the biggest brands in both in, on the agent, team and broker side, but also in the technology side.
Yeah, for sure. And you know, as you alluded to Mike very good companies, <laugh> sometimes do not communicate their value proposition or connect with their target customer effectively, as the old saying goes, you know, if you're inside the bottle, you can't oftentimes read the label. And so we come into companies and we sort of help them with an outside perspective. And whether their target customer is a home buyer or seller, or whether their target customer is a real estate agent or a real estate broker, we help companies stand back and give them a perspective on you know what their value is and, and what their positioning should be. So yeah, we've done that for, you know, large companies including Zillow and down to, you know, local boutique real estate brokerages.
Yeah. and it's, and it's always obviously really outstanding creative work and visually strong. I, I really appreciate the work you guys do there. so now you're talking with, with realtors, brokers, teams, et cetera. it's a weird market right now, right? It's, it's like, you know, the it slow it went from the hottest ever to the abrupt stop. Talk to me about what the smart brands are saying right now, like, and how we, what's the right way to communicate with folks in this world? Like, you know, does my, has my value proposition changed from a year and a half ago when I was taking orders?
Yeah, well, I guess the bad news is, is you can't market yourself out of a market downturn. the good news is you can use a down market to differentiate yourself and build your brand. And what I mean by that, I suppose, is that right now, as you said, it's a, it's a weird market. It's confusing. We're, we're coming off weird times into a different kind of strange times. It's very confusing for those of us in the industry. What that means is it's also extraordinarily confusing for the consumers we serve, right? So, in a strange way a difficult market for your customer to understand, for your home buyer or your home seller to understand is a great opportunity to demonstrate your expertise and your knowledge. Like you said, Mike, I mean, when, when it, when homes were flying off the shelves, when volume was crazy, when sale prices were crazy, you know, if it wasn't quite order taking, it certainly in many cases was pretty straightforward. It's no longer straightforward. And home buyers and sellers are confused. They don't know how to read the signals. They are inundated with real estate data, housing, news. They hear the name Jerome Powell five times a day. Whether they're listening to N P R or on social media, they don't know what to do. So what a great opportunity in this environment for you as a real estate professional or a real estate brand to deliver that kind of clarity.
Yeah. I like that difficult market is, is your best opportunity to grow, like, to really differentiate
Yeah. If you're, if you're good at what you do, if you're a good brand, a good company, if you're a good team, if you're a good agent, now's your time, right? Because those who aren't maybe so great are gonna have a hard time helping people understand and navigate this situation we're in.
Have you seen work that you think has been really great this year? Like some of the great brands or companies like, like messages or, you know, initiatives that you think are, are really cool?
Well, I'll, I'll give, I'll give you an example that, and I think they've done this consistently, but I, I do think that they've done an exceptional job over the last year kind of explaining what's going on. And, and, and that is redfin's effort, right? I mean, Redfin has always put a huge effort into basically data driven pr. they have a strong data and economics team that is constantly churning out information that attempts to give people clarity about what's going on. and I just think they always do a great job. And, you know, sometimes in the, in the traditional real estate industry people don't like to talk about Redfin or Wow, then Redfin's a discount or this, that, or the other thing. There's a lot to learn from Redfin. And I think right now they're doing exactly what I described, which is being a signal of clarity when things are really tough to understand,
Right? signal of clarity. I like that. So very often the incumbents, or a lot of the folks in the industry don't like to talk about Redfin, but they also don't like to talk about tough market information. And I've, you know, always preached that when I was early in, in Altos and I would go on stage at a conference, it's, you know, 2007, 2008, and I would ask the crowd, how's the market? And a hundred percent of them would say it's great. Like, they're, they're taught that they, they are not allowed to say anything bad about the market. You don't wanna sound like a Debbie Downer when they ask you. So you, you've always gotta be upbeat. And even when the entire world knows it's 2008, the market is not great, right? And so I was always at, you know, trying to teach people to answer with data in that, in that time and to have the data to be, and, and right now is a similar time, right? It's sales are down, however, inventory is significantly lower than we thought. So if you're a seller, like that's, there's opportunity now like walking in, answering with data right there. And have you seen other things that brands are doing? So Redfin is great, like I, and you know, and, and Daryl Fairweather is outstanding, and Taylor Marr was on the, on the podcast here, and we talked about what they can see in the world. and they often use their data as brand level strategy as opposed to maybe lead level strategy.
Yes, totally. No, that's, that is all about building the Redfin brand, right? Yeah. Right. If Redfin, you know, their, their whole ethos is we are here to give consumers a better deal. We are here to advocate on behalf of consumers, whatever, you know, it's, it's very consumer-centric, and they're dedicated effort to put data out there. Whether it's delivering good news or bad news, I think is a manifestation of that. Whatever you want to think about the company outside of it. But, you know, Mike, I like your point about sensibility inside the real estate industry of not wanting to talk openly about a bad market. I've heard as you have, it's so many times sort of the old line in the, in the training and coaching world and real estate is there's never a bad market. There's no such thing as a bad real estate market.
There's a real estate market that favors sellers in a real estate market favors buyers, but there's no bad market. So, and that's actually, I think, sort of harmful because we do a lot of consumer research a thousand mile. And we do that just as part of our client work. We also have a, a service that, that publishes this research. And what's really interesting is how desperate and hungry people, consumers are for the truth. So we have tested various messaging and different sort of ad concepts with buyers and sellers in this weird market and messaging to the effect of well, it's a great time to the sell where it's a great time to buy, or we've made real estate easy because of technology. People don't really resonate with those kinds of messages. When we test messaging along the lines of it may not be a good time for you to buy.
It depends on how badly you want home ownership and the terms that you can negotiate from a seller when you offer, which is the truth, right? It's the truth. It, it, it depends is the correct answer, particularly when the markets in a strange place and people gravitate to that. And we've done focus groups where we test this type of messaging, and realtors aren't trained to say that I would love, I have yet to see this. I would love to see a real estate brand or a big real estate brokerage. Somebody come out and say, it's damn tough to be a home buyer right now. It's gonna be really painful for you, but we can help you if you really want it. I, I just, why not say that? Because everybody knows that's true. And just tell the truth. People are hungry for that kind of real messaging.
Yeah. You know, the, the to tell the truth, and it's a, it's a, it's a position of strength. It's a, it's a, like, you know, like, look, it's, it's like the, you know, it's equivalence that the takeaway close in sales trading, right? It's like, this may not be for you. And then, you know, if it is for me, like I'm opt-in stronger, right? Like, and, and and so like that is effective because people go, oh, he's not pushing on me. And, and of course, in the industry, and like, I get accused of this all day long about, like, I've got some agenda, like I'm trying to, to like, I'm trying to single-handedly turn the keep home prices up, you know, <laugh> like that, like that kind of thing. And and so, but people have that really strong consumers have that really strong impression of, of realtors.
Yeah. So I, you know, this is talking about, generally speaking, whether it's the individual realtor or a big real estate brand messaging and positioning and differentiating in this business, it tends to be what I call sort of a, a look around business as far as marketing and advertising. You try to find the people who are really successful and you say and do what they say and do, when in reality what you should be doing is to look around and do the opposite of what they do in most cases, right? I mean, that's the essence of differentiation. It's one of the things that I think is interesting. And I would, I would be curious to hear your, your take on this, you know, you've been doing it, you've been doing for a long time now, and there's so much data out there that's readily available to practitioners, and sometimes it feels to me as if it's just copy and pasted and put into social and it's put out here, it's put out here, it's put out here, and inventory's low and prices are up, or whatever the story is at the moment. And it's never really thoughtfully contextualized, right? Isn't the value add in trying to interpret or say what this means or might mean, rather than just throwing a bunch of charts around? I mean, you know that that's what you do.
Yeah, yeah, for sure. I think we have two things that happen. One is that most of the folks are in real estate because they are people, people not because they are data analysts. And so many of them even if they knew how, and like a lot of what we do at El Altos is teaching people how to communicate about the data. many of them are afraid to I'm afraid to talk about this way because I don't really know. And like, that's part of what we try to do as a business is like, how do you teach people to give them that confidence to be able to use the data? and you know, we have, we created an ebook where it's like, you know, we have scripts and you have like, you know, here's a question people are gonna ask, and here's ways to answer it, and here's why the report is structured this way.
So you can tell the story through there. It's funny, I, you know, I do these videos every week and it's like 10 minutes on the, and, and people say like, how do you come up with what you're gonna say? And like, I go and I read the data and I say, look, there's this much, the inventory, it went up and, and I was surprised that it went up, or I was surprised that it did not go up. And like, so I start there and that builds, and the story builds from there. and but I think it's also useful for people like watching my videos because then, then they can say, oh, he's not that smart. I can say that <laugh>, you know, we can lead from there. do you have other insights in your consumer research? Were there anything that jump out that you learned? So, so you know, the ad test is really interesting, right? Like, we know that consumers will respond to the brutally honest maybe line in advertising. what else did you learn in those?
Oh, gosh, we've done, we've probably in the last year and a half fielded 15 different national surveys on a bunch of topics ranging from you know, we touched on compensation, which is something that you don't see touched on very often. and what was striking there in this, I gotta talk about this for days, but the level of ignorance around how realtors are paid and how brokers are paid was staggering. So we did a survey late last year of recent buyers, people who have bought a home in the last three years, okay. Nationwide survey. And we asked them did your, did your agent on the buy side speak with you about how he or she would be compensated? 65% said no. do you feel like right now, looking back on it, you understand how your realtor was compensated?
10% of those people, 10% said, I have absolutely no idea. about 50% said, no, I don't really know. And 40% said, yeah, I, I think I understand that. So there's, there's informational vacuum around compensation, which is really interesting considering all the regulatory and legal energy around this particular subject right now. And so one of the conclusions that we drew from that, that's, I, I think we've tried to socialize a little bit, is wherever there's an informational vacuum, wherever, people just don't get something that's an open doorway for you to walk in and be the one that, you know basically fills that space and positions themselves as sort of the, the truth teller. So we took that, we recommended, you know, really leading with compensation in your marketing, not just on the side as many listing agents already do, but particularly on the buy side, because if people don't understand what they're paying for, they can't value it. so that was one thing that stuck out at us. There was a whole bunch of other stuff we did survey on luxury real estate means that was pretty interesting. it's interesting what happens when you, when you listen to people <laugh>.
Yeah. Yeah. Yeah. That's great. survey work. It's not something that I've I've done, but I aspire to because there's all, you know, of the, the ways to analyze what's happening in, in the world, like asking people is, is a really, is a really awesome one. That's, that's great.
I'll give you another one real quick, Mike. This, this I thought was super interesting. So generally speaking, and you can probably remember this, that the Harris Poll used to do a national survey of people's esteem for professions from most esteemed to least esteemed. Okay? And this was the top, you'd know, have always have like doctors, okay? People respect doctors. And at the bottom you would have personal injury lawyers and realtors, right? And it was always just a bummer when you'd see that come out. And sentiment was always super low for, for realtors. And we feel that a couple surveys with younger people, those who are Gen Z and millennial, and it turns out that they have a much higher regard for real estate professionals than the generations that came before them. And one of the reasons why, I think, is related to another question that we asked them, which is, do you watch reality, reality real estate television?
And a large majority did. Okay. Now, my personal point of view always was that, well, this is frivolous garbage and it's damaging the image of the profession. Well, I was wrong. Not only do people consume this type of media, but we asked them, does it make you more or less trustful of real estate professionals? And a large majority said, it makes me feel more trusting of real estate professionals. So you got all kinds of weird stuff going on there. But bottom line is younger people like realtors, <laugh> whereas people my age and older, not so much.
Right? That's fascinating. And I've actually saw some stats. I don't remember where I saw the stat, but, but it was that you know, on the topic of how gonna disrupt the real estate industry and, and we're gonna need fewer agents, and, you know, more click on the, the web, but, but I saw some stats that said that millennials are actually using realtors at a higher rate than previous generations. And maybe that's related. Like they trust them more. It's like, oh, I know exactly what to do, <laugh>, because I've steam on tv.
They do. I mean, we, this blew my mind. We just a couple months ago explored social media usage around real estate with younger cohorts and 65% of Gen Z and millennial renters, these are people who are, they don't own homes. They're not in the market to buy homes. They're just young people. 65% either follow or come across regularly real estate agents on social media. Like it's nuts, right? So there's this level of persistent engagement with the world of real estate that just wasn't there for you. And I, we saw, we saw realtor ads in the newspaper headshots, that's all we saw. Now you're seeing talks, you're seeing Instagram reels, you're seeing Facebook posts, you're seeing 50 different reality TV shows selling sunset and all that junk. I don't like, people are into it and they like it.
Yeah. That's really fascinating. 65% of Gen Z follow or regularly interact with, with real estate agents on social media.
Yeah. It's part of their life. They say, yes, yeah, I see realtors out there in the social world, or I follow them, which is, you know, again, that's, we never had that. So when you say, well, millennials are using realtors more, well, of course they grew up with realtors in a certain way that you and I didn't.
Yeah, that's really fascinating. And, and, you know, social media and, and done well, or any media, but really social media done well is a trust builder, right? People like, you know, if you're a truth teller, like you're like, that's, that's, and that's really neat that you're, as you point out that the any, any information vacuum, would you say any information vacuum is your opportunity to be that truth teller, to be the, to a real differentiator there? That's, that's a great point. The the compensation factor is really fascinating. And, and, and you know that it's very opaque and everybody, everybody that has their thinks that realtors are overpaid. And everybody since Freakonomics in 2004 think that, that, you know, realtors are working against you. And like, it's a it's a really fascinating cultural shift. If now I start to get my information directly from the realtors in a social media world, do we finally move past that?
Yeah. I look, I, and I, I've done some analysis and given some talks on this recently people don't have a problem with the way realtors are paid. They don't have a problem with how much realtors are paid. It is it is a battle and a cause that has been enjoined by a, a certain cadre investors and entrepreneurs who think, who think they have the point of view that realtors are paid too much, and that that is an unjust backward system that needs to change. The problem is, is that the consumer is not so disposed. So if you look at here, I'll say something maybe a little contrary about red pin. Red pin was based on the notion that consumers deserved a better deal and that realtors were paid too much. Well, they've been around for 18 years, they have less than 1% market share, and last year they got rid of the cornerstone of their business and ethos, which was the buyer rebate.
And when they got rid of it, they had to get rid of it because the market turned and they needed to, you know, write the ship. But they reported that when they gave that back, nobody cared. The consumer didn't care about it, right? So, you know, sometimes we, we pursue things as, as outsiders or entrepreneurs or investors in the name of consumer advocacy, when in reality we're just sort of projecting our own point of view. it it, the real estate world, as you know, is, is just this complex of emotional and relational dynamics that is very hard to change or supplant <laugh>.
Yeah, for sure it is. I always think that that's funny that the over the years, you know, I'm a Silicon Valley guy, and, and so I've come in and I've seen, see those pitches and see those startups, and, and I used to find it to be funny that the people who think that the people who most commonly think that the realtors are overpaid are the venture capitalists who are like the most overpaid people <laugh>, you know, on the planet <laugh>.
Yeah. I mean, look, I think, you know, you can watch really smart people. that was, there was a video about five years ago, you probably saw it from Alex Rappel at a 16. And, and he basically gay probably the most rationally airtight takedown of the existing real estate brokerage model that I've ever seen. And it made perfect sense rationally that this is messed up. But the reality is the, the, the truth flies on the emotional or irrational side of the ledger. And that's just the, the nature of the beast. And I think that's why you've seen a lot of companies try to to use the term that's used too much, disrupt this business without success, is they're coming at it logically when the calculus is really fundamentally irrational.
Well, and it's, and, and the, you know, they have a, a perspective you know, maybe we could take the cost outta this industry, but we also know that the consumers keep opting for the, the highest service they can get, rather than the lowest cost they can get. Right? As evidenced by, by Redfin dropping their lowest cost options, right? They like, people would rather have somebody there to open the door for 'em and tell 'em why they should or should not buy that house and, and, you know, have an expert to walk through the, the goofy legal things that they, that, that, that house bespoke challenges of that house. you know, and, and so like, consumers continue to opt for higher service, even though they have lots of low you know, they have discount options, but in general, they, they keep opting.
And so it's like we have a hypothesis about how we might disrupt the space, but the consumers keep, keep, you know, saying that that that they want something different. It's like, you know, before Tesla, all the EV makers were trying, were like, oh, well, people wanna save money with electric, and so we should build these cheap cars. We can't build them cheap enough, we shouldn't do it. And Tesla said, well, let's build luxury cars because what people really want is luxury. And, and, and like, it was an entirely different your mind shift. And, and it's really, you know, I think it's similar with, with folks who coming into, coming into real estate going, what I can do is take out, you know, a few thousand bucks out of a transaction you know, by doing it online.
Well, at the end of the day, when you're going through a real estate transaction, my sense is most people want to feel good and they want to be comforted. you know, it's the reason, I'll give you another analogy for a different industry. The average American family spends $9,000 on, on a funeral, okay? So if you think about that rationally, it, it doesn't make a lot of sense, right? you know funeral directors and, and those type of services are notorious for charging people for things that maybe rationally they don't need. But the reality is, it's such an emotionally acute moment in time. People need to feel good. And so we continue to spend thousands and thousands of dollars on funerals that, you know, rationally just don't pencil. And I think a home sale or a home purchase is kind of the same thing, right? We do it 1, 2, 3, 4 times in life at most. It's, it's kind of an outlier.
Yeah. And feeling good is, is a legitimate thing to pay for, right? It's like people will pay for it. And it's, and providing that, that comfort and that f that peace of mind is, is isn't, it's like that's real value. Okay. So let's move on to some other things, you know are there some common mistakes or like buzzwords or, you know, that kind of things? I saw you recently wrote about, you know, hyper-local as a, as a frame. Are there things like that that you're noticing that, that people are stuck on?
Yeah, I, I would say, well, that, that's a good example. So, like I said, you know, this industry for whatever reason tends to be a look around industry when it comes to marketing and advertising. People look around and see what the really successful people are doing and repeat that, whether it makes sense or not. or we gravitate towards really thin sort of gauzy concepts that really don't offer anybody anything. So hyper-local is one of those things. So you, you deal with a lot of real estate companies who say, well, we're local or we're the hyper-local option. And our challenge to that is always, what do you mean you're local? All your competitors, you know, within this particular metro, they, they all live in the same neighborhoods you do. You're all working out of the same offices and doing the same things and going to the same grocery store.
What do you mean you're hyper-local? What does that even mean? Who cares? Right? or, you know, sort of a thin approach to luxury. Well, what does, what does luxury mean? You know, traditionally in, in real estate marketing, it's kind of meant using the color black and gold and using maybe a script font. Now it's become somewhat more sophisticated in recent years, but it's still often sort of thrown out there in this very thin sense that does nothing to you know, guide anybody or help anybody make a decision about anything. So the challenge with marketing and positioning is always to go beyond those platitudes and to say something different. I've, I've always said that the essence of branding and marketing is saying, or doing what your competitors are unwilling to say or unable to do. Right? Find those things, find the things that your competitors that aren't willing, that aren't willing to say and say them and find the things that your competitors can't do and do them. Right? That, that's what you would call, I guess the the, the greenfield or the open space in the market. Everybody kind of gravitates into the same themes when they should be doing the opposite.
Yeah. And, and so as a broker or a team in this space, like, you know, it's, it's seems like it would be hard to find those things you know, those things that, that other brokers aren't ready to say. Have you, do you have any good examples off the top of your head about companies that do it Well, have said things? Well,
<laugh>, there aren't many Mike in, in fact, I always wish people would, would, would push farther, but you know, if you're a local a local team, actually we did, there's a team that we did some work with a while ago, and they basically took the, the queue that we put out there and I mentioned earlier, which is to say that effectively now is probably not a good time to buy, right? Well, it, it may be, it depends on how much you want it, but anybody who tells you it's a good time to buy, run away from them as as fast as as possible, right? in their marketing. Now, it may be a good time for you to buy as an individual, but don't just tell me in your marketing that now is a great time to buy. Right? That's not true. It may be, but it depends on a lot of factors, some of which are quantitative, most of which are not measurable in that way.
Yeah. Okay. I like those. I like those a lot. The let's talk for a second about the longer term future. A lot of, a lot of question I like to ask. All my guesses is about, you know, the, the latter half of the decade, and we often talk in terms of data and demographics and, you know, market and mortgage rates and things. But what do you see for the latter half of the decade for the real estate market? Are there big trends we should be paying attention to?
Yeah, and look, I don't know what the real estate market's doing, and I rely on you for that, Mike. So <laugh>
Not an economist or a data nerd, but I, as an observer of the industry, I do think that we are probably, well, I should say the realtor's not going away. the real for, for all the reasons we already discussed, right? The, the exemplary or extraordinary character of this particular transaction, the deeply interpersonal nature of the, the, the relationship people have with the realtor, et cetera, et cetera. So I don't think realtors are going away. However, I do think that we are probably going to see some fundamental changes in the structure of the industry. And by that, I mean, in part, I do believe, and there's been lots of talk and speculate about this for the last two years, that there probably will be some legal or regulatory action that will change the, the, the way in which real estate agents get paid, right?
We have this really unusual system here in the states of cooperation and compensation. I, my gut is that's probably gonna change somehow. And what that's gonna do is to create a situation where many real estate agents are not able to survive or make it. And I think there are other factors that are probably pushing in that same direction as well. You know, not just the, the abrupt market downturn, which will probably knock three or 400,000 realtors off the realtor roles before the end of this year. But I think there's gonna be a lot of things forcing that. And I think we're gonna end up, hopefully, and maybe this is wishful thinking on my part, but a leaner, meaner, smarter population of real estate professionals right now. You know, we peaked at 1.6 million realtors last year. It's crazy. It's absolutely crazy. It's a million too many. So, you know, I'm hoping that we get to a place where the real pros are able to do their pro thing and serve the, the needs of, of people who want to do this important thing. So I think that is going to happen.
Yeah. Do you do you see how that does that impact how you plan thousand watt and your constituents going forward? Like, like do you have fewer black and gold with the script font <laugh> projects? <laugh>?
Yeah. I mean, look, you're dealing with it right now. I mean, the bottom fell out of the market basically early last summer, and reality changed abruptly. And we're, you know, we're, we're still in kind of a weird space and will be for who knows how long you know, you have to be good in a time of scarcity. I mean, we went from, what, 6.2 million resale transactions in 2021, and now what are we, we gonna come in in the low fours close to four, something like that, Mike. I mean, you just don't take 2 million, you know, transactions off the table in 24 months and not have some stuff happen. Right. You know, so in, in this sort of environment of scarcity within the industry, you have to be as good as you can possibly be because there are too damn many mouths to feed and not enough transactions to feed them all. So, you know, it's sort of this Darwinian moment that we, we we face in the industry, which, you know, not to be dark about it, but that's how we evolve. We get better, right? <laugh> survival <inaudible>,
Right, right, right. The stress e evolution comes from stress. the the good news and the data, Brian, is that the trends are right now that the, the transaction volume is climbing. And so by the end of the year, we will have normalized. And so we, the, the, you know, we from, from July one of last year to July one of this year will be, that'll be the low point. And we're, we're climbing out of it week by week now. So, you know, hopefully by the end of the year, you know, things feel, you know, substantially more you know, stable.
I, I will take that to heart, Mike, you've just called, I can expect normalcy by the end of the year.
That's, that's what, yes, you can put a flag in that. I'm
Gonna count on that. Mike
Need, I need some normal, yeah,
Exactly. So, you know, we, we talked a little bit about some interesting projects you've done. You've done some really good stuff. You did some work with I think Picasso lately, when you do a thing like a PropTech company like Picasso, Picasso's, super cool run by very smart people, well capitalized, what kind of a process do you do with a project like that in
That case? what we helped them with was their effort to get agents to basically refer their clients to Picasso, right? And so in that case, and really with any, any project like this is you're trying to figure out the emotional and rational drivers of your target customer's behavior, right? So what rationally, if you're a PropTech company selling to a realtor, what rationally can you say to them, right, that they haven't heard 15 times before? And then what is it that you're offering them emotionally, right? To feel good about what you're doing? And you have to start from that baseline and then ladder up your benefits from that. And then once you create your benefits, you have to come up with the proof, why should I believe those benefits? And it's gotta be better than like, here's the old, it's like a tired pickup lines in a bar, right? It's like work smarter, not harder, Mr. Realtor, right? How many times have we heard that one, right? We have the good leads, so you gotta do better than that, right? So start with what's the, the, the baseline emotional and rational sort of makeup of your target. How do you speak to those things in benefits? And then how do you prove it in language that actually sounds credible
When you're working with brokers, A lot of the stuff you do with brokers are very distinctive visually. Did they do you find that some of the brokers, are they able to really create unique propositions that are not like, you know, we're hyper-local? are they able to find something that's truly unique when they're, when they're establishing that branding?
yes. we tend to gravitate towards independent companies that have a distinct culture and good leadership. So if you have those things, if there's some sort of core truth about what you do or core value within the company, we can build off that. we can't go into a brokerage company that honestly has nothing going on. It just makes stuff up that doesn't work. So what is the, what is the core truth at the heart of a company? And that then you can build off of that. And then the visual stuff, which is really easy to show. You see it on our website and all of that, right? You know, if, if a company has a certain market position or they have a certain connection to a place, or they have a certain cultural energy, the idea is to manifest that visually through design in a way that makes people, that, that feels true and makes people feel good, right? You know, it's like you used the Tesla example. Very few people wanted to drive a crappy Chevy Volt. Everybody wants a Tesla, right? Because it feels good to be in the Tesla, and you pay a premium for that. So if you create a visual identity around a real estate company that feels good to people, they'll want to be part of it. And you know, it's all this, it's a little squishy because it's not entirely rational, but that's kind of where we live on the squishy side of the the ledger.
And that's why they need skilled skilled practitioners such as yourself to, to help lead people through it. Cuz it could be, it could be hard, otherwise it comes out very generic every time if you do it yourself. that, so that's great. Brian, you do, we're getting close to the top of the r You do you do a lot of writing, you do a lot of writing on the blog. where do, what's the best way for people to reach out and follow your work and your insights in the world?
probably just to go to our website, which is thousand mot.net 1 0 0 wtt.net. And yeah, we do a weekly newsletter called The Dose, and it's basically, we share creative inspiration, stuff like that. We share some of our work. It's not a sales pitch or anything, but it's, it's kind of our take from our point of view. you can sign up there. That's probably the easiest way to like, you know, keep in touch with us or figure out what we're about.
And it's good. It, it's good creative and often practical exploration of your, your observations on the real estate industry. I like to read it each week. Okay. Brian Boyer, it's been really a pleasure. Like, this is exactly what I wanted to get through. Like you were talking about, about communicating, about marketing. I loved your, your consumer research. There's real real insights to, to have in the world. So we can't talk, I can't talk with an economist every episode of <laugh> top of mind as much as I like it turns out there's more in the world than that. So I really appreciate you bringing some diversity of thought to our little platform here.
Well, Mike, I enjoyed the discussion. Thank you for having
Me. I, I, I really appreciate it. Great. Thanks. Brian Burro from thousand watt thousand watt.net. That's 1 0 0 0 3 0 thousand watt Do net everybody, this is the top of Mind podcast. Thank you so much for joining. All right, everybody, more soon.
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