The following are a few trends that I’m starting to see emerge for 2018 as I travel the country and do research on REALTOR® Associations, Multiple Listing Services, and the real estate market.
Feel free to agree, disagree, or otherwise, and send your thoughts… 2WayC3@gmail.com
1. Leadership Shifts
- Nowhere is this shift more pronounced than at the N.A.R. level where Elizabeth Mendenhall, and more importantly Bob Goldberg, are definitely setting a different tone and direction. I believe this shift is going to have a significant trickle-down factor in terms of the association’s focus and those who identify themselves as association leaders.
- We are seeing the front end, or back end depending on your perspective, of a demographic shift in the workplace that will usher in newer, and likely younger, Association Executives & Leadership.
- The initial wave of YPN leaders who emerged in the late 2000’s are now in leadership roles at the local, state, and national level. Leaders like Brian Copeland, Nobu Hata, Dale Chumbley, Maura Neill, and too many others to name found their association footing via YPN are now reshaping associations, and their approaches/tactics.
- Experience levels among volunteers and leaders are beginning to striate. Many associations, especially the higher performing ones, are seeing a more representative group of REALTORS® serving on committees, task forces, and even among the Board of Directors. Decision makers are now just as likely to have been in the industry for one to five years as they are twenty plus years.
- With this shift in experience levels, including among AE’s, many different focuses and priorities are starting to emerge. New and different leaders/volunteers are bringing with them a variety of skill sets and perspectives on a quickly evolving real estate industry. They are pushing associations to move outside of their comfort zone. The question is whether they will reshape the association’s priorities and focus, or will those married to status quo mentalities quickly jettison these new volunteers and their ideas in order to remain comfortable?
2. Consolidation & Cooperation
- Momentum, if not pressure, continues to build around association consolidation & cooperation. This is especially true in areas where hot metropolitan markets are spilling over into neighboring communities, largely driven by affordability & clients needs. This is creating new natural market places, which is eroding typical association jurisdictions.
- There is undoubtedly a building “Keeping Up with The Jones” mentality. Which for the most part is a healthy for the association world that often needs some external motivation to honestly embrace the idea of constant improvement. As the association world becomes smaller with the communications and connectivity available today there’s pressure being placed on all associations to perform at a high level due to member awareness associations who excel. Associations/executives who can’t meet member and leadership expectations will surely start to feel the tightening of the consolidation noose.
- In addition to the development of new and extend real estate marketplaces, shifting MLS service areas and regionalization are also adding to the consolidation movement. As most members identify with the MLS first and association second the associations will likely be forced go where the MLS subscriber wants to be. So, the reality is that MLS consolidation & regionalization is likely to drive association consolidation in some form.
- As mentioned in the Leadership Shift trend above, there’s a demographic shift happening amongst the AE ranks. Most don’t realize, but the average AE is older than the average REALTOR®. Why is this important for consolidation you might ask? To be frank, because a significant number of associations are afraid to even consider merger or consolidation out of respect for their long time AE’s. As AE’s age out, one of the biggest challenges to consolidation, loss of jobs/staff, is taken out of the equation.
- Ultimately, many associations are becoming far more sophisticated in their thinking and planning approaches, due in part to the Core Standards requirement to have strategic plans. Which means they’re more capable of embracing long-term thinking/planning. As associations move away from the entrapment of thinking & operating on a year to year basis and start to look at long-term stability, the more likely they’ll be to consider new organizational structures that protect the REALTOR® brand over the individual association chapter.
- BONUS THOUGHT: I’m a firm believer that consolidation as we know it to be is also set to change and that new innovative models beyond merger, consolidation, & shared services are out there waiting to be implemented. If you are interested I’d be more than happy to talk to you about an Alliance model floating around inside my head.
3. Rapid Acceleration of MLS & Association Structure Assessment
- All quality strategic thinking is being driven by questions about the future of the Association/MLS. If you’re not at a minimum assessing your Association/MLS structure, then you’re likely setting each entity up for failure. It may not be tomorrow or the next day, but the aggressive nature of those who are actively assessing this right now will find its way to you in the not so distant future.
- There’s still a great deal of fear-based decision making happening before, during, and after any assessment of the Association & MLS structure. Fears about loss of value and income are driving the association perspective. While concerns over market & data protection along with local control & norms are inhibiting MLS decision makers. These thoughts are to be expected, understood, & appreciated, but quality organizations and leaders will utilize them to inform perspectives on the Association and MLS relationship, rather than using them as excuses not to perform a thoughtful & informed assessment.
- I believe changes in MLS policy & technology, consumers, and subscriber/member expectations are setting the stage for two distinctively different philosophies. Organizations that are guided by proactive thinking or those choosing a reactive approach. I don’t believe the null or status quo alternative exists moving forward. Some will do proactive better and more aggressively than others, but if you’re not at least actively assessing your current structure then you are setting your organization, and members, up for a future that will be dictated & created by others.
4. Advocacy Solidification & Adaptation
- We’re several years into N.A.R.’s core standards requirements for advocacy to be embedded into the value proposition for Associations, and many are starting to appreciate advocacy’s worth as an exclusive service offering. I applaud those who have not only implemented it but embraced it! This is a great first step towards insulating the association against outside factors. The challenge now is to further integrate advocacy and become more sophisticated in the delivery of programs and services. Oh, and by the way not everybody will get it, or like it, but if it’s the right thing to do then true leaders push beyond.
- It’s important for the success of N.A.R. that every association around the country solidify advocacy to fully leverage the magnitude of membership at all governmental levels to protect housing. So, for the next couple years that should be the focus for many of the association looking to shore up their value, especially if your association may be facing a post-MLS value proposition era in the next 5 years. Associations need to continue to refine the four I’s of advocacy: Involvement, Investment, Information, & Influence.
- Associations seeking to excel will need to intently look at strategies that will allow for advocacy adaptation. I would urge these folks to develop strategies, as a part of their organizational strat plan, that go beyond, “Being the local voice for real property rights”. Sophisticated & impactful advocacy organizations have fully developed & emotionally compelling messages, programs, and services. Moreover, they take proactive measures to ensure that their message and passion are broadly embraced.
- There’ll be a continued integration of the consumer & community into all advocacy activities. This not only increases the impact of advocacy efforts, but when linked with strategic community outreach can also soften & strengthen the REALTOR® brand.
- It’ll be important how N.A.R., state, and local associations deliver messages around the tax changes & related national legislation. N.A.R. seems well positioned to tell a story of success on behalf of a large number of homeowners. However, there will be several associations around the country challenged to share in the messaging based on pricing in their markets. But, again this is a mark of an impactful association and great organizations adapt to these types of messaging & regional challenges.
- Advocacy adaptation strategies must include a focus on how to develop compelling messaging campaigns to build upon & carry legislative success forward, like many are doing with recent first-time homeowner programs. Additionally, association tactics and messaging around state & local elections has to evolve if member’s dollars being spent on these activities are going to be maximized and appreciated.
5. Volunteer Activity
- A final undercurrent I see developing over the next couple of years that may surprise some, and honesty may be a bit of wishful thinking, is that dynamic associations/markets will begin to see an increase in volunteer activity & interest among members.
- Markets that have seen a strong return since the 08-09 bottoming out and have experienced an influx of membership growth over the past 5 years creating a couple of scenarios where I envision volunteer increases. First, most of the hottest markets have seen a sharp increase in the price of homes due to inventory challenges making every deal worth more which encourages members to stay in the business even if they aren’t as active & closing as many deals annually. Secondly, some markets that saw a solid return may be slowing, but members are either well established, easing towards exiting, or new but committed to a business that they enjoy.
- Either way members start to have more down time and will diversify their activities to keep themselves relevant in the marketplace. Viable associations will draw these volunteers interest & good associations will leverage these volunteers.
- Association offerings that increase & build lead-based relationships will be valuable for members. As will quality education programs & educator onboarding systems that help members to hone their skills and broaden their business opportunities. This’ll be especially true for members who joined the business in the past 5-7 years as they are now able to move beyond basic survival-based business activities.
- An additional influencing factor to consider is the number of members going out on their own or moving into different brokerage models that don’t build in as many service or educational offerings. Therein increasing the opportunity for associations to demonstrate worth for these members.
- Whether you see this as an undercurrent or not, high performing associations need to continually improve the quality of their volunteer experiences. Remember, the ability to recruit and retain great volunteers/leaders depends on the value it offers to the volunteers, not the association. So, make sure that your volunteer/leadership experiences have a clear focus, set timeframes, & positive outcomes or risk losing them to the other 3,332 organizations who you are competing with for their limited time & energy.