Monthly Archives: October 2011

Small Ball

by James Stefanile, ABR, GRI, SRES, QSC, REALTOR/Associate, Prudential NJ Properties

I was wracking my brains trying to come up with a connective piece of wisdom between the New York Yankees’ collapse in this year’s American League Divisional Series and real estate.

Let’s get the obvious and trite out of the way first and fast:  “Pick yourself up after a defeat and face the next day”  “The best laid plans….” “Sports is like life – a compressed version of our lives”  “Even heroes have bad days”

There are probably many more vacuous and un-original sentiments to be gleaned from baseball but I don’t want to clutter my mind with any more.

The reason this Yankee loss resonates with me is that I’ve been their fan since I was 10.  I’m always saddened when their season ends, be it in the first round of the playoffs, as in the last two years, or at the end of the World Series because, for me, it’s the end of baseball until next spring.  There’s no particular joy in watching teams play that I don’t care about if the Yanks are gone and there’s no more baseball with winter approaching even if they win the Series.  The days are shorter, colder, less forgiving and won’t be amiable and gentle again until the next crack of the bat at Yankee Stadium in April.

I think I have a clue of a connection between the 2011 Yankees and the real estate market in general.  By all accounts, the team ultimately failed because they ignored or didn’t try to correct some glaring weaknesses in pitching and their lineup.  These are pretty fundamental deficiencies.

We real estate practitioners are enduring a market on its knees and I think that a lot of us are just marking time, waiting for buyers to come flooding back and prices to rebound to past levels.  We’re ignoring the fact that neither will probably happen.  Our past expectations of market conditions are, most likely, gone forever as are the type of buyer and seller we became accustomed to.

So, like the Yankees, we need to deal, head on, with the glaring deficiencies in our thinking.  Neither the Bronx Bombers nor real estate agents can rely on a storied and successful past.  The percentage of home ownership has dropped, nationwide, from 66% to 65%, the largest 10 year drop since the Great Depression.  Even the Obama Administration has opined that home ownership is not as important as it once was and renting is the way of the future.  This is a seismic shift in government position.  Washington has always been a home ownership cheerleader, encouraging us all to take our destiny in our own hands through the autonomy of ownership.

Well, not any more.  And I think a lot of people are heeding this message which is why the rental market is so hot and the residential and multi family markets are so flat.  Paradigm shift is the best way to view this, in my opinion.  To illustrate this, for example, the Yankees have always relied on slugging veterans to win.  By contrast, in the 80’s, Manager Whitey Herzog introduced the concept of “small ball” to the St. Louis Cardinals, another slugging club with shifting fortunes.

Whitey Herzog – Hall of Fame Manager

Also called “Whiteyball”, this paradigm change from home run slugging  to small hits, speed, stolen bases, bunts, pinpoint pitching, defense and smart base running, manufactured enough runs and victories to propel that team forward.  They shifted their thinking to acknowledge certain realities and succeeded.  Maybe the Yankees should try a paradigm shift, rely more on youth, speed, reliable pitching, and find another bunting coach as good as Phil “Scooter” Rizzuto who taught their players a thing or two before he died.  It appears to me they need to fundamentally re-examine their approach to the game.  Their starting pitching was cobbled together and, ultimately, unreliable but the team put the best face on it all season. They had the highest number of home runs this past season but a miserable percentage of productivity with runners in scoring position, especially in the playoffs.

Yeah Robbie, we feel the same way…

The big producers in the middle of their batting order had a puny average during the playoffs, underscoring the futility in relying on a few big hitters to carry the team.  In fact, the bottom of their lineup was much more productive.

It always takes time for humans to react in any productive way to a paradigm shift.  Our situations shift under our feet and it’s a while before we realize the world has changed.  Then there’s usually some lag time while we comfort ourselves by denying that anything is different.  By the time we are ready to act it’s often late in the game, the fans are headed for the exits, the pitcher is throwing high and tight to our heads, the umpires are ringin’ us up and we’re slinking back to the dugout.  I see real estate offices closing or consolidating into smaller quarters, brands disappearing, agents leaving the business.  The membership of the National Association of Realtors has dwindled from its highest point a few years ago.  The pitcher threw “bean balls” at these folks and they didn’t think to duck.

We REALTORS need to learn to play our version of “small ball”, a new way of practicing real estate which includes skills attuned to our new reality, just like big-leaguers need to learn how to bunt and steal bases.  We need to acknowledge that buyers have changed, gotten younger, become more tech and information savvy and are certainly more demanding.  We can’t rely on the same old scripts.  It’s always been unbelievable to me that the profession pushes “scripts” or pre-written responses to objections, etc.  Whatever happened to honestly listening and answering our clients’ concerns from the depth of our knowledge and experience?  The “back to basics” approach that covers most real estate training must shift from pre-recorded palaver to genuine leadership.  We must acknowledge that buyers are insecure as well as informed, sellers are VERY insecure and angry and we all need to be better informed, faster on our feet and – dare I say it? – charismatic.  More than ever before, we need to be our customers’ “muse”, a wise man (or woman) that they can rely on and learn from.  The old methods of customer relations where clients are merely handled will only set up adversarial relationships.  We need to inspire and lead and beat the catcher’s throw to second as we steal the bag.

Back to the drawing board, Joe?

If this all seems pretty obvious, I’m sure you won’t be surprised to know that some real estate agents are clueless to all of the above.  They are hard-working, honest, diligent – and dull.  They couldn’t inspire a leaf to fall from a tree.  I don’t want to come across as superior but I hope I can muster a better attitude than that.  We in the business all need to aspire to an appreciation of another paradigm where our cleats are clean, we have a big lead off of first and we’re catching the ball with the bat (that’s a bunt, for the rest of you).  Otherwise, the end of the season will be fast approaching and the days will become shorter and shorter and colder.

Leave a comment

Filed under Market Changes, Paradigm Shift

All In The Family

by James Stefanile, ABR, GRI, SRES, QSC, REALTOR/Associate, Prudential NJ Properties

My father was a window trimmer.  “A what?” you may ask.  He created window displays for retail stores, car showrooms, trade shows, etc.  You don’t see much of this anymore.  Many stores don’t even have front window display areas.  You’ll find descendents of the trade mostly in liquor stores.  These “trimmers” are usually in the employ of a liquor company.  My father was a free-lancer.

He used to take me on jobs from time to time when I was a kid.  I would hold the ladder, hand him the staple gun, etc.  He was rather demanding, an “artist” of humble gifts and I confess I didn’t enjoy those outings.  I don’t know if he wanted me to carry on the family business or not but it didn’t appeal to me.  My professional interests eventually took me in other directions and he never commented on his ambitions for me.  He never seemed disappointed that I didn’t pick up the staple gun.  On the contrary, he said I was smarter than he for forging the path I took.

Here in real estate there are many, many family businesses or “teams” consisting of parents and their children.  There are brokerages that have been in the same family for generations.  These family businesses kind of remind me of the old days when any kind of business, be it building, plumbing, dry cleaning, a hardware store or a butcher shop was manned by family members and it was expected that children would inherit and run the business when the parents retired.

I’m not knocking the idea, although it seems a bit quaint and antique to me.  I marvel at the family who can work and live together.  Day in and day out, no buffer zone, no break from each other.  It’s either hell on earth or a model of loving, co-operative family life I’m not programmed to understand.  I can appreciate it, however, and the people who make it happen.  I think it’s great that parent and child can exist in a mutual endeavor with a common goal.

I’m not sure it’s the most fulfilling destiny for a child, however, the easy access to money and a job notwithstanding.  Here again, it’s an antique notions.  Back in the day, opportunities and ambitions were limited.  It was not a given that family members would go to college.  The family business was a survival path for everyone in the family.  Now, the sky’s the limit for most children.  They don’t want to come home every night smelling of fish or provolone like their parents.  They want to explore, to achieve a unique destiny.  Many modern parents are encouraging these individualized ambitions as well.  We seem to be evolving toward self fulfillment and away from tight-knit family ambitions.

So, I look at these real estate “brats” with a combination of condescension, wonder and awe.  I regard them as limited throwbacks and lucky bastards at the same time.  I appreciate that they had good adult examples to follow, successful, hard-working parents who passed on the business and the ethic to run it.  I suppose I’m a little envious of the largess they inherited.  Every dime I’ve ever had I made happen myself with no help from parents, college professors or anyone else and I started earning real money at a very early age.

I was at a real estate convention where a mother/daughter team was on a discussion panel.  They’re from California and they are top producers not only in their market but in the nation as a whole.  What struck me most of all was the obvious affection they had for each other.  By the way, they were both beautiful and beautifully dressed (in almost matching suits) and perfectly coiffed.  They made a lasting impression on me because my life does not include this kind of parent/child paradigm and looking at it makes me struggle to understand it.  The daughter was not just Mom’s water-carrier, either.  She was an equally contributing and skilled member of the team.  I was impressed, appalled and confused at the same time.  I watched the daughter work the crowd after the discussion and she seemed very invested in the whole scene.  I still wondered, was the child’s ambition always the same as Mom’s or was she dragged into the business by default, by a parent’s assumption?

I guess by now it’s obvious I’m an individual who’s followed his own drummer and no one else’s.  My daughter has inherited the same dubious distinction.  She’s currently out west pursuing a path that would never have occurred to me.  She looked at real estate with a combination of horror, pity (for me, I guess) and non-comprehension.  She’s an outdoor girl and the idea of being in an office, even for a little while makes her shudder and the thought of dealing with people in the midst of an emotional financial transaction made her nauseous.  My reaction is – great!  Be your own girl.  Don’t rely on or adopt my idea of security.  She can inherit my work ethic, my savvy, my instinct for people – and she has – some of the things she tells me about her interactions remind me of me.  She doesn’t, however, have to inherit the ambitions I’ve had.  You may recall I was in show business before real estate. When my daughter was in high school she became a very skilled stage manager (one of the many jobs I had had in the business) for some very large and complicated school musicals.  I was filled with dread that show biz would become her chosen path since she was, obviously, good at it.  It’s the hardest business imaginable (next to music and restaurants).  She grew out of it in time with no opinion from me.  It would never occur to me to encourage my child after my interests (or to discourage any vocation).  As a matter of fact, one of the half-joking “threats” I used in her high school career was “You’re only one failing grade away from a real estate license!”.

I’m going to assume that the real estate parents I’ve met have encouraged their children’s participation in the family business as voluntary and optional – a familial embrace and invitation.  I’ll also assume the interactions in these family businesses are loving, collegial and family centered with everyone ‘s fulfillment coming from the family’s common ambition.  Bless these people who can combine family and self-fulfillment.  And bless those parents who build something worth passing on.  My father didn’t exactly retire, he just stopped working (in his 70’s) and by that time there wasn’t much of a business left. 

Being a rugged individualist has its rewards, I have found, but it also exists in a solitary neck of the woods.  Perhaps being part of a family enterprise has its limiting drawbacks as well.  Maybe there’s an ambition out there where we can have everything.  I doubt it.

Leave a comment

Filed under Family Businesses