Lessons I Have Learned from 10 Years in Real Estate | Zillow is The Tin man from the Wizard of Oz!
Zillow is The Tin man from the Wizard of Oz!
(He is a key Character but alone he cannot help unveil the Emerald Palace!)
I know many agents who hate and I mean hate Zillow. I think in part because they fear it ruining their business. I am not one of them. Zillow is not to be feared. It is a national website, not a Miami specific site. They have some good automated systems to predict market movements, including the value of your home or the home and market values for next year. But when all is said and done, they are limited. Their system cannot feel, and buying is as much about feeling as anything. They have some very useful elements but they are not without flaw and alone are not the solution to a successful sale or purchase.
Human psychology is still a huge driving factor and until tech develops a soul, gains awareness, it simply won’t replace top agents. Sure, It will replace agents without heart and without understanding of human behavior. Those that don’t recognize the motivations of the buyer or seller.
There is no place like home! There is no place like home!
Hundreds of thousands of people use Zillow daily. In fact I guarantee you that right now there are over 1,000 people looking at Miami Real Estate on Zillow. Some will look at the Zestimate, BUT if you ask them if they can truly believe that it’s accurate, they will say no or at the least second guess themselves. Why? Because they don’t feel it, and if they don’t feel it, they don’t understand it and won’t believe it.
As we all remember the ‘Wizard of Oz’ and what was needed to lead Dorothy to the Emerald City and ‘pull back the curtain’ to reveal the inner workings of the empire was ‘A Brain, ‘A Heart’ and ‘Courage’. Lessons we can all learn in life, but interestingly when applied to real estate it draws some interesting parallels and the characters act as interesting metaphors for the navigating of the real estate landscape.
Miami is like the Emerald City. Beautiful and alluring, but not everything is as it would immediately appear to be. There is misdirection along the yellow brick road and one needs the right friends with the right characteristic to ensure prosperity. ‘Lions, Tigers and bears oh My!’
My goal has always been to build trust in my business. A Brain, A Heart and Courage are three requirements for building trust. But one cannot exist without the other and YOU NEED ALL 3 IN ORDER TO BE SUCCESSFUL!
Simply one won’t work, and I will explain why the stool will not stay vertical if just one of the 3 is missing!
A Brain is needed
Analytical understanding and statistical knowledge is very important. It could be said that Zillow possesses this attribute. So does a number of other businesses; Tech driven businesses. But they are one piece. Precise and accurate analytical reports cannot be accurate if they don’t take into account the ‘human factor’. You can never just extrapolate the curve and guarantee that is what will happen.
That ‘X’ factor makes predictions impossible. It is argued that if we have ALL the variables we can predict anything. We become omnipotent. But, as anyone who has studied the philosophy of determinism (If you have not don’t bother as its not light reading!) this philosophical idea is that all events, including moral choices, are determined completely by previously existing causes. This philosophy has in much part been debunked, because of a little know thing called ‘Free Will’. Free will is born from emotion and the awareness that we are free to shape our own destiny as we see fit and this is why a pure analytical ‘Brain’ is not enough. Free will is what makes markets do unpredictable things, why deals collapse for no good reason or sometimes why the unachievable price is achieved. Past performance is no guarantee for future results.
A gotta have Heart
This is if you will the opposite of the ‘Brain’, it’s the emotional, sometimes irrational part of the process. So many decisions on what we buy and where we live are intensely personal. Homes have to ‘speak to us’. Certainly we use our rational mind to asses whether a property is a good spend of our money. But there are a very good number of intangible, non-specific variables which add value to a property. In my experience buyers do NOT walk into a property and say; its got 4,000 SF, a kitchen, 5 bedrooms and its new… so I am going to buy it!
There are a lot of ‘heart’ factors that can add or detract value. Finishes are often hard to quantify and it’s not just that they are new, it’s that they have the right ‘feel’. For want of a better word: ‘heart’. You no doubt have heard the words: “This feels like home”. Some call it ‘energy’ some call it a feeling, some call it heart. Home most certainly is where the ‘heart is’ but the heart has to feel at home first! Follow?
Ironically ‘human feeling’ ultimately drives buyer behavior so if the heart is not there the ‘Brain’ will falter because the analytics will go horribly off course and the numbers will be wrong. You won’t be able to understand why one home gets $600 per SF and another only gets $450 when it sells. The reason because the unquantifiable human factors are mismatched. They looked the same on paper, but when you go into them they feel totally different.
You will notice that when I write my reports I have some ‘Charts and Graphs’ but then a whole lot of ‘social narrative’. This is where I talk about ‘why’ things happen NOT just the ‘what’ or ‘how’ things are happening. I often go into the mind set of the market and try to understand. My focus tends to be the accumulative patterns and trends I see from the human experience. The more I talk to people the more I realize buyers and sellers want forecasts; an idea of what will happen next, but you cannot figure that out unless you know ‘why’ the current market is doing what it is doing. In short I am listening intently to the heart of the market!
But once again on the flip side, emotion without rationality or ‘brain’ gets us into troubled waters. It can create impulsive behavior and spiral us into economically troubling waters. You know the saying that individuals are smart but crowds are stupid. All too often inexperienced or unseasoned investors get caught up in the slice and end up running right off the cliff! (Fun fact: A herd of lemmings is called a ‘Slice’). Brain needs heart and heart needs brain!
Finally we have ‘Courage’ or what I like to refer to in real estate as ‘Conviction’. The conviction to know and say the right thing. To look at a client and be absolutely certain that the advice you are giving is honest and true. Because your experience with 1000’s of clients tells you that it is true. I often say that the David of 2011 and the David of 2018 is separated not as much by knowledge or passion but by the strength of certainly, or conviction and this was born from experience and experience alone.
Courage means turning down that listing, because you know it’s priced too high, courage is holding steady and telling the client to hold out for a better offer, or to grab the offer if it’s right because its truly the best one out there.
Clients come to me because they want more certainly in an uncertain landscape. The decision is so big they need someone to help them filter, someone with a better filter than they have. I have developed the courage now to talk my mind and my knowledge of the market and my learned and studied approach gives me the courage to voice my opinion without fear of mistake.
It is however important to recognize the difference between an agent who is courageous and one that is a ‘Bully’; in short: ‘Courage without heart’. I have gotten to know a number of top agents over the years, many are nice, but some feel too big to fail and end up bullying their way through deals. They are supremely confident seem courageous, well experienced and know their markets, but ironically these same agents are also typically arrogant and that often puts they in a psychological state where they put their needs above everyone else’s, even their clients. There focus takes out the heart and their lack of empathy can mean they convince their buyer to take a course of action that is really not in their best interest. Have Courage and have a brain, but don’t lose heart!
So there you have the 3 elements. Culturally different ‘earth, water and fire’. These fundamentals have always been ingrained into our decision making. Real estate is an intensely personal reflection of who we are and the space we occupy. Civilization is built around real estate, cities and development. Changes of how we live and why we live. I feel privileged to help shape that in the small corner of this earth called ‘Miami’ and I promise to all my clients that the ‘Lion’ the ‘Scarecrow’ and the ‘Tinman’ all have a place in my office!