Boston Condos for Sale and Apartments for Rent
Realtors’ worries
When I started selling Boston condos for sale, there were 716,000 Realtors in America.
Today, there are 1,563,000 Realtors in America.
Whoops.
As I write this, there is one Realtor for every 165 adult Americans (by comparison, there’s 1 physician for every 262 adult Americans, and one lawyer for every 250).
According to the NAR, the average homeowner stays in their home 13 years.
This means that practically everyone knows a Realtor, but that peoples’ engagement with the world of real estate is widely episodic. This creates a diffusion — a kind of amorphous, confused, often irrational web of relationships, really — that makes transformative change exceedingly difficult to effect.
The net of this? In the most important ways, how people buy and sell homes, and how Realtors get paid, has mostly stayed the same since 1997. Billions in funding, very bright business brains, a revolution in technology — these have all swept over the real estate landscape only to mostly, over time, recede, leaving the basic structures intact.
The effort to disrupt real estate
The effort to disrupt the Boston condo for sale market over the past quarter-century has been like an engine of gears without teeth: There’s a lot of spinning, but very little forward drive.
Disruption with benefits (for Realtors)
Yes, in the past few years, tech pioneered real estate websites have come up with a new way to sell that “disrupts” the traditional model. But according to Zillow, as of March, they accounted for just 1.3% of existing home sales.
Cash buyers companies that front cash, or create the effect of cash, for homebuyers who want to buy before they sell, or compete in a white-hot market, ascended over the past 2 years at a rate that seems unlikely to persist in a slowing market where buyers find it less imperative pay a premium for such a service.
Importantly, all these new tech real estate companies all vigorously pursue Realtor referrals and/or partnerships.
Zillow, the most powerful brand in the history of housing, launched with a “power to the people” ethos aimed at wresting control over real estate information from Realtors. Today, over 75% of its revenue comes from these folks.
Boston Condos for Sale and the Bottom Line
My point with all this: Realtors still own the keys to the Boston condo buyer and seller kingdom. If you’re a lender, you’ve known this forever. If you’re in real estate tech company, you’ve come to learn or accept it.
Will there be 1.5 million Realtors 25 years hence? I don’t know. But I am quite sure that, today, Realtors are at the center of the residential real estate world.
Updated: Boston Real Estate Blog 2022
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Massachusetts Realtors are getting nervous about Fed plans to stop propping up the housing market. It looks like a major lobbying campaign is about to commence.
Clearly, the feds can’t keep funding all these mortgage securities and tax incentives. But at least one economist in the article says it might be a bit too early to end them now.
What do you think?
