The 7 Basics You Should Master for a Strong Real Estate Career – Know Your Inventory
No beating around the bush today, today’s blog post is about INVENTORY:
- Lead Generation (Month 3 Post)
- Knowing Your Inventory (Today’s Post)
- Follow Up (Month 2 Post)
- Development of Best Practices
- Transaction Skills Mastery
- Marketing my Brand
- Time Blocking for All of the Above (Month 1 Post)
This morning I am sitting at the airport at 5 o’clock in the morning, waiting to board a plane to decadent New Orleans…not to party at mardi gras all night but to attend an annual conference held by my real estate brokerage. And while I really look forward to the information sharing, the comradery, and the tech innovations to knock my socks off, I am trepidatious about leaving my business behind, even if just for a few days.
Honestly, I have a wonderful team in #ChuBaldwinHomes and a total fabulous beast for a business partner (#RobertaBaldwinRealEstateBeast) – I know she has it covered while I am away and vice versa, but I am always uncomfortable when I miss out on new inventory hitting my northern NJ market…and for me, this isn’t just about houses for the week in my little 5 town market radius. One of the biggest decisions I made after the “great sadness” of 2008-2012, was to expand my market area. I come from a very “boutique-y” set of towns – the ones that surround #MontclairNJ are SMALL, and at this moment, inventory is a bare trickle. Just like in 2008-2012, there are challenges – it sure is hard to sell houses when there ARE NO HOUSES TO SELL…
So, casting a wider market net became a significant part of my business plan, and pushing out to 5 counties became not just a necessity, it became a CALLING. The idea of being a “master of my inventory” down to a very granular level was a driver, not only for me to attend broker open houses consistently on a weekly basis, but to attend them in any number of towns where I was pushing the boundaries of my business. I quickly discovered that while some buyers are very married to a specific location (this is the town I grew up in…my family is nearby…my child is already in this school district…etc.), many are relocating from NYC, Jersey City, Hoboken & other more urban areas and surprisingly open to a variety of locations, as long as it fits their criteria for ease of commute and school district needs. Introducing clients to new towns requires familiarity with:
- the GENERAL inventory of these towns as it relates to style & age (Well Buyers, I see that you love the Colonial centric inventory of Montclair, with Tudors and Victorians as well, built mostly between 1880-1940’s…your special attraction to the Estate Section of town leads me to believe you might also like the estate-style Montrose Section of South Orange, which is about 15 minutes south of here with 2 of its own train stops on NJ Transit to NYC…what do you say we check it out?)
- the specific inventory as it pertains to competing houses by the week in different towns (Actually, Buyers, since you really like the layout, condition and finish work of the front to back Victorian at 8 Hamilton in Glen Ridge, I am thinking you may also like the beautiful house at 11 Lenox Place in Maplewood – it is similar in style and also only a 3-4 block location from the NYC train station – shall we see that one as well?)
Additionally, “inventory” by definition, refers to the tracking of inventory performance in your market area towns – knowing and retaining enough pertinent information to speak intelligently and with expertise on:
- How many houses sold in town in this price range in the last 1-90 days?
- How many houses sold in town in this price range in the last 90-180 days?
- How many houses sold in town in this price range in the last 180-360 days?
- What was the average list to sale price ratio in each of these time blocks?
- How many homes does this town carry on the market at once?
- What has been the monthly and cumulative absorption rate in this town over the last year?
- Of the houses both sold and under contract currently, how many offers did each house receive?
- What is the current and average number of days on the market of homes sold in town?
- What percentage of these homes in the past year were distressed (bank owned & short sale)?
- What percentage of these homes were fixer uppers/estate sales?
- What percentage of these homes were occupied standard resale home sales?
- What percentage of these homes were renovated (flip style) homes?
- What percentage of these homes were new construction?
- What is the style breakdown of single family homes in this town (eg. 40% Colonial, 15% Victorian/Farmhouse, 10% Tudor, 12% Ranch, 12% Cape Cod, 7% Split Level, 4% Bi-Level)?
This list could go on and on, depending on just how deep you want your knowledge deep-dive to be, but this will at least give you a head start in being able to answer the most basic of questions when you are hit with data-hungry clients who want all the answers. And given a shifting market, past & present inventory familiarity, casting a wider inventory net and inventory data deep-dive should help keep your business firing in all cylinders.