*Adjusting to Market Shifts

One of KJF Partners’ Core Values is:

“We are driven by our personal commitment to create value for our investors, tenants, teammates and brokers.”

To serve our broker partners, we send occasional emails that focus on things that I have learned through my brokerage history or that I notice from my current role on the principal side of the business.

Brokerage is a very challenging business and, if you’re going to be in the business, for the long term, you must shift with market changes.

Although I didn’t realize it at the time, I was lucky to start my brokerage career at the high point in a real estate cycle. About a year after I started making active calls, the market shifted dramatically, in a severely negative direction. Because I didn’t have an established base of clients at that time, I was fortunate to uncover some new sellers in the market and that led to other, similar clients and deal types.

Some of the things that I recall during that shift are as follows:

  • Some very skilled brokers kept applying their skills to the same clients that were, for the most part, forced to the sidelines and not actively transacting.
  • No matter what the climate was, there were still deals happening. Velocity slowed dramatically for a time but, it never stopped completely.
  • The buyers and sellers that were becoming active were a newer group of people and institutions. Gratefully, they did not have long established relationships with brokers so, working that group was, in many ways, less competitive (in the beginning).
  • The new sellers and buyers needed guidance and appreciated good information and skillful representation.
  • Many brokers left the business. That was sad, but those of us that stuck it out, captured a greater share of the market as business recovered. A down market does create opportunities for future dominance.

The shift in that market was dramatic and, although the current market shift seems significant, many of the market fundamentals, such as vacancy and tenant demand, are still in pretty good balance. No matter the shift, there are some things that I believe are always wise to consider.

In all markets you should constantly be evaluating:

  • What are you attempting to create?
  • Evaluate what actions you are taking to move you toward your goals. Evaluate your actions, your strategy, your implementation of that strategy and, of course, your results or progress toward your goal(s).
  • Evaluate the market beyond yourself. What types of buyers and sellers will be, or are, active right now or will be active soon? How do I reach them and how do I capture them? Do the prospects that I’m spending my time with right now have the ability, or desire to participate in the current market? (As a buyer or a seller)
  • If you are not making the desired progress. Based on your evaluation, adjust. These may be adjustments about who you are targeting or an adjustment in what you are saying and asking of that group or how you are proposing to create value for those prospects.
  • Implement the adjustments and get busy making a lot of calls to test your changes.
  • Evaluate the results of your revised actions and, if necessary, make more adjustments. Evaluate and shift until you create success.
  •  Be persistent, be tenacious and take a long-term view of success.

Being a professional real estate person requires a realization that individually, you cannot change the greater market so, it’s imperative that you rapidly adjust to the current market and use your skills efficiently to maximize potential. Change can be difficult and letting go of what may have worked yesterday can be frightening. When you walk a tightrope between two trees, it is impossible to get to the other side if you refuse to let go of the first tree. It makes sense then that if you are walking a tightrope between two markets, it’s tough to excel in the new market if you won’t let go of the old. You may have to let go of clients temporarily, or overpriced listings to create room for the “new.”

Evaluate, release what’s necessary to succeed and, as always………

Happy Hunting!


Joe Faris

KJF Partners, Inc.

Cell Phone: 949-275-5038

Email: jfaris@kjfpartners.com

Website: www.kjfpartners.com

PS: If you have subjects that you’d like to see become future topics for This Principal’s Perspective, hit reply and let me know what your thoughts are.