April 2012, Salt Spring Island Market Analysis

April, 2012

Change is erupting all around us.

The change of seasons is the easy one!

The continuing evolution of our post-Internet 21st Century world delivers shifts on an almost daily basis, and in all spheres.

The MLS system is undergoing substantial change. The consumer control over connection means agent marketing must change, and what about social media venues for linking a buyer with a realtor and thus with a seller? What about that role of the realtor as the connecting bridge between a seller & a buyer?

Locally on Salt Spring, in real estate, we have seen the closing of a long standing franchise based local office and seen its office space & remaining realtors being assumed by a non-franchise off-island company.

I think this kind of amalgamation/restructuring will continue. The impact of the internet on all business models continues. Nothing remains untouched. The car industry, the travel industry, the stock market & financial side of investment, even education…these business models have completely changed because of that consumer-oriented Internet impact. The Real Estate industry is no exception.

The franchise model of real estate is a 20th Century and pre-Internet concept. Any benefits to a franchise connection were erased after the internet’s impact. The Internet delivered control of the sales process to the consumer of the service.

As the technological and consumer oriented world continues to progress, some franchise options are disappearing or are trying to survive by amalgamating with others. The “big box” solution.

Some others are attempting to fit the very different evolutions in the business world into their systems…add ons with the appearance of the “new” (meaning the “current”). Since the ground level is where the change has occurred, this band-aid approach may not be sustainable.

Localized boutique style and “niche” business models may be an arrow towards a new/different sales model…if such boutique ventures are using the Internet the way the consumer is involved with it, that is. One has to be where the customer is…otherwise, in the all encompassing terrain of the Global Village, the information won’t get to the consumer.

The bottom line: what system displays the information directly to the consumer, and, at the same time, invites a proactive response from that consumer? Ah…that is the question and the oh so sought after answer! Isn’t that what SEO is all about?

Real Estate companies put together an array of marketing ideas for their salespeople. The company charges their salespeople to use them. Nothing is for free. These options appear as logos on generic company sponsored business cards, and are mentioned on company websites.

To benefit from these options, though, an individual realtor would have to pay for their use. Belonging to a franchise company is the generic logo part. To use what that company promises, the individual realtors pay to take part. Unless they do that, the company descriptions are just logos, with no particular focus on specific listings/areas.

Marketing is about perception, of course. Even if no substance behind it, the mere statement of something promised will often create an initial business relationship. This does not deliver a hoped for result, however.

Be sure to inquire. Yes, yes…your company says “x”, but do you do that for me, as my individual realtor in my specific area? Be a savvy consumer!

A branch office of a franchise (each office is locally owned and operated; the franchise name is like an overall umbrella name), or a boutique option (specific to an area), or a realtor acting unilaterally, as a Licenced individual…the 21st Century allows them all, and due to the impact of that direct consumer experience, the search engine power, all of them are now equal in marketing venues. Now that is something different!

A “big box” name is sitting on the same level playing field, now, as the area specific boutique office or even the individual realtor presence. That leveling influence is, of course, the result of the consumer driven Internet search…with its capability that puts the user of the search in control of both the discovery & the outcome. Different days, indeed!

And what about that office? Is it real? Virtual? Does it matter? Not.

In the Ethernet space of the virtual Internet world, it’s the information that is being provided, to the searching & consumer driven “engine”, that is the essential item.

I always feel that our time is like that classic schism between the long ages of the agrarian lifestyle & the sudden, unforeseen, explosive impact of the Industrial Revolution. Those on the side of the older world experienced the pain of change & some jobs disappeared. Those on the side of the new world of the machine age experienced the euphoria of change & new jobs came into being. Sound familiar?

Change means different…something new replacing something old. In a post-internet business environment, the key is to get the information to the attention of the person who needs that information. However, that “consumer in control of the action” aspect means that the end user is in charge of the “where & the when” of the action.

I think real estate as an industry is in the middle of the change delivered by the Internet.

As a realtor, one has to be in the flow of the shift, and be attentive to what delivers the bridge moment between a seller and a buyer.

That is where a realtor lives…at the point of expediting that connection. Important, then, that the realtor remain nimble & willing to change, & to experiment, in the effort to connect a listing with a buyer.

Ah…in change lies opportunity.

Markets are not static items, either. This Spring, the Gulf Islands are showing a definite uptick in sales volume in the entry level priced residential category. It is just beginning to be felt by the upper tier priced residential options. Good news, indeed! We may be in the slow climb out of a downmarket…perhaps we are in year 7 of a 7 to 10 year cycle?

Our season is traditionally March Break to Canadian Thanksgiving Weekend, in early October. For the first time in four years, there is market buoyancy when there should be.

As a buyer, it’s important to recognize that the benefits of a buyer’s market may be dissipating. Seller’s market in place by late Fall or by early Spring, next year? Hmmm…change, remember. Being nimble..being in the flow of what is.