How quickly things change. America is not the same. The world is not the same. My little hometown of Evergreen is not the same as it was a year ago. As if changes don’t come fast enough, in just a few months in the year 2020, it’s become a challenge to even think that things could be again how they were. The world, as it was in 2019, seems so vague and so, so long ago. But… the opportunity.
The opportunity that I’m experiencing is that of deep introspection and critical improvement. Even though these two things have been a relative constant for me through my adult life (I’m highly analytical), like most people, I’d rather things change slowly so that I can make the necessary adjustments in easy increments rather than wholesale changes. The danger in reacting to a quickly changing environment is that of overcorrecting. Not to wax religious in any way but, this is one of those areas where the Serenity Prayer comes to mind. “God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.” So, what do I do and what do I don’t do, and how do I know for sure?
The COVID came and took its toll. And it hasn’t gone away, but it will. Divisive politics is nothing new and it won’t likely be going away anytime soon. The economy will expand and contract. Colorado will always be a beautiful place to live, and so growth will continue. Young people will have new ideas and not all of them will be good and not all will be bad. Many older folks will be stuck in their ways and some will gracefully adjust to change.All of these are truths, in my opinion, that are highly relevant to what I do in my work and my personal life going forward. Because, one more truth… there’s no going back!
Constants, or the science in the context of this writing, make an excellent foundation. When a client says they need a bigger house, or a smaller house, or they’re moving back to Tennessee, they’re looking for my help to accomplish that as easily and advantageously as possible. Or, when a first time homebuyer comes to us to help them, similarly, they want us to help them accomplish that within their set of wants and needs and their budget. In both cases, I immediately go to work laying the foundation upon which we’ll build in a successful outcome. This all starts with the science.
In my world, that science is steeped heavily in technology and data. My monthly market data download gives me a head start. Knowing the ratio of available inventory to the inventory that is currently under contract illuminates the environment we’re working in. It’s a seller’s market right now, by the way. That is the first constant that factors into our objective. Interest rates, and how tight or loose lending practices are, are other relevant constants. The maximum mortgage a buyer qualifies for and what they have for a down payment are a constant. Sometimes, a prospective home seller will tell me the absolute minimum they would sell their home for, so that becomes a constant. Of course, that very subjective constant isn’t necessarily steeped in science, aka reality, so it would not be unusual for me to decline that particular listing. The science is important! Utilizing the right technology to obtain accurate data is also very important. Without a proper foundation, we are building a house on shifting sand. To be clear, many of these factors are constant in the moment, though they will fluctuate over time, even over a short time in some cases. But a seller selling a house and a buyer buying a house is doing so in the moment, so it only makes sense to view these as a constant in the moment of execution.
But science has its limitations. Witness Zestimate. There is much that a computer can figure out when good data is input. But the data they have available is limited to the fields that the various counties use to describe homes. Age, square footage, lot size and geotag are all relevant to the property’s value. But it doesn’t know the difference between the cat lady, hoarder house and the one that’s been completely renovated. It can’t tell the difference between a home that backs to a busy arterial and one that backs to a park. You see where I’m going with this. The art of real estate is every bit as critical as the science.
While it’s fairly easy to understand that most art is reliant on some underlying science, it’s a bit more of a leap to grasp the importance of art to the science. Art, by nature, is fluid, subjective and unpredictable, right? But what is the value of scientific data without the art of discerning the reliability of the data, the relevance and the implication it has on your objective. The same is true of the technology and the art of using it to achieve your goals.
To tie this all together, I’ll point out that 2020 saw real estate go from what started to be a rubber stamp copy of 2019, to a screeching halt on in-person showings and a momentary near-cessation of new listings on the market, to video showings and virtual showings, and eventually back to in-person showings with full PPE regalia (mask, gloves and sanitizer galore). Real estate offices became like mausoleums. Home office technology ramped up and nearly everyone became instantly Zoomenabled for everything from sales meetings to education sessions to listing appointments. And then, something really crazy happened. The market got legs like it was being chased by a bear! WTH! While the inventory never recovered from the setback in March, the demand accelerated with the added jet fuel of again record-low interest rates and small investors’ thirst for the ever palpable investment opportunity of Denver residential real estate. The multiple-offer dynamic became at least as strong as it’s ever been, maybe stronger. So, the art of utilizing quickly evolving technology (science) to put our product, our listings, out to the right audience in optimal form and presentation (art) has significant effect on the ultimate outcome for the seller. And, the art of helping that homebuyer obtain a good home, within their budget, before the price rises over their budget, requires using the science of catching that new listing the MOMENT it becomes available and having the data to know if it’s priced reasonably enough that going 5 – 10 percent over asking isn’t just stupid, and then crafting and transmitting a good and timely offer that gets accepted.
I hope I made the point I intended here, though I may have strayed a bit. But just know this: While there’s nothing simple about real estate today, if you have the right artist working proficiently with the right science, you’ll enjoy the tremendous benefits of real estate ownership, which is, after all, the single best longterm investment most of us will ever make.
Happy Homes from your “Home Team.”