The Insider: Issue 031
It dawned on us this week that tax season has arrived. After a brief panic, we unearthed some lighter takes on these dark months, found a new real estate market to obsess over, and put the industry’s first NFT transaction in the U.S. on our radar. Read on, friends.
Last Week This Week
RE/MAX CEO Adam Contos is stepping down. This in and of itself is not huge news, but did get us thinking that RE/MAX is an interesting 2022 acquisition target. They have a global brand, are a household name in the states, have 120,000 agents, and valuation of just $580M. That’s 1/4 of Realogy’s valuation, 1/8th of Redfin’s, and nearly 1/30th of Zillow’s. Plus, they are heavily weighted towards listing agents in the U.S. Are we crazy?
Zillow announced the hiring of a Chief Design Officer, which has led some to speculate that they may get into home-related e-commerce or somesuch. We don’t think so. Zillow launched “Zillow Digs” in 2013 to play in this space, got stomped by Houzz, and quickly retreated. Sometimes a hire is just a hire.
John Burns of John Burns Real Estate Consulting put it simply: “Can the fed ever really raise rates again?”. Mortgage rates drifted upward to their highest level since April of 2020 last week, but remain historically very low. And this mild upward movement only seems to have egged more buyers into the market. All systems seem to be “go” for another hot real estate year.
Broker/franchisor HomeSmart, which offers agents a low cost, 100% commision plan, intends to go public. HomeSmart is one of a cadre of companies (Realty One Group, United Real Estate, JPAR, etc.) that re-set the brokerage financial model by eliminating or centralizing offices, cutting out expansive managing brokers, and passing the savings on to agents. To varying degrees, the rocketship that is EXP has slowed their momentum, and we expect more companies in this category to head for the exits.
Have You Heard About This?
See You In Tampa
Those of us in and around real estate won’t be surprised by the statement that home prices and cost of living in America’s tech epicenter — Silicon Valley and San Francisco — are driving talent away. But where are they going? Our team in Oakland over the last few years has bid farewell to many friends moving to Austin, Portland and Los Angeles. Now it looks like Tampa, Fla., may be rising to the top of that list. The city has become a bit of a rising star in the tech world and its housing market is poised for growth along with rising local income, favorable tax rates, constrained supply, and attractiveness from both Millennials and Boomers. And, according to Propy, a real estate technology company that is streamlining transactions and paving the way for cryptocurrency in real estate, Tampa is set to be the first market with a real estate NFT.
What's Inside
Download our new Original Research report: The complete real estate experience: Homebuyer attitudes towards one-stop shopping for real estate, mortgage, and title/closing services.
Inspiration Point
Life, Death, Taxes
We’re digging the new tax season campaign from TurboTax dubbed, “You Do Your Thing.” The campaign hits a sharp note of relevancy in a time when people are starting businesses, striking rich with cryptocurrency, making a living producing oddly specific YouTube content, living in vans, and making wild career pivots. And it’s snappy and fun — two things we’ve never associated with tax season before. TurboTax is a software company, but it makes a significant amount of revenue from its services. There’s lots in here for other service-based businesses (ahem, real estate anyone?) to learn from. As we all know, you can only say things like “we offer the highest level of customer service” or “service is paramount to our business” or “white-glove service” so many ways before the entire world tunes you out. (Sorry, no one has been listening to these lines for decades now.) TurboTax took some creative swings to get at the same angle.
Beyond The Buzzword
Here’s an interesting read about the imperative of having a strong brand story in the post-COVID reality of commercial real estate. We obviously buy into the power of brand here at 1000watt. But we would caveat this conversation with the nuance that brand story is not something you can simply conjure up in a conference room. It is a long-term strategy that must be adopted and rooted into your company’s core business. For brand stories to be effective, they must have a seat at the C-table. Case in point: Tesla, an example the author points to as the most powerful brand of modern times. Tesla’s brand story wasn’t simply created in a marketing meeting. Musk built the company around it from day one.
Quote of the week
“Forever is composed of nows.”
— Emily Dickinson
