Real estate business

How to run a (real estate) business in times of crisis

In 2020, leadership really mattered. Economically and medically, leadership really mattered. At the national level, where we lacked it, at the New York State level, where we had it (mostly), at the New York City level, where we lacked it (mostly), leadership really mattered. And as in politics, so in business. Businesses where everyone pulled together had a much better chance of weathering the pandemic. It’s not easy to keep a business afloat during tough times. Having been a CEO for 30 years and weathering 9/11, the 2008/2009 recession and now the first wave of the COVID-19 pandemic, here’s what I’ve learned about crisis leadership in real estate:

  • Make tough decisions and make them quickly. Strategy only matters if the business survives. With real estate tours in New York closed for three months and few buyers willing to engage solely on the basis of virtual tours, brokerages completely lost their source of revenue for an entire quarter. Survival therefore depended on swift and strong action from above. The CEO had to make the decisions about staff furloughs, downsizing, marketing workarounds as soon as the severity of the problem became apparent.
  • Deploy the technology and remember its limitations. Real estate agents, deprived of the possibility of going out, could only show properties virtually. In a high-value market like ours, few people were willing to engage without an actual property viewing, but good technology enabled agents to keep their buyers engaged and help them reduce their range of options to the most appropriate choices. We need to provide our agents with the most useful technologies while carefully selecting to make sure we don’t waste their time with new products that don’t help them sell more. In my experience, only about 10% of these new tools actually improve the agent or customer experience.
  • Encourage debate. Even the best leader only knows what he knows. If you’ve assembled a good team with a diverse set of skills, listen to them. And also listen to your agents; as entrepreneurs, they often excel in both original thinking and creative solutions. Once a good idea emerges, listen to everyone on the team talk about the pros and cons, then make a decision. Once you’ve made a decision, stick with it.
  • Build consensus. The whole team must carry the same message, which must both respond to the circumstances and be on the mark. Different people react differently to a crisis. A good leader will take the necessary steps to ensure that the whole team fully understands the message and the reasons for the decisions made. “Because I said so” doesn’t usually seem like a compelling reason to kids; this is even less the case for adults. The worst thing a leadership team can do in a crisis is to send a mixed message.
  • Think of three steps ahead, but focus on now. It is always important for a leader to have an idea of ​​what he will do next depending on the evolution of the crisis. At the same time, imagining doomsday scenarios weakens even the strongest among us. Coping with what’s in front of you requires projecting yourself forward, but it doesn’t require worrying about future problems that you can’t control. Treat it when it happens.
  • Communicate clearly across the organization. Important decisions that affect everyone should always be communicated person to person. In today’s world, that often means Zoom. No matter how you do it, your constituents need to see you watching them when they get tough news. Email is both too impersonal and too easy to transfer outside the organization.
  • Be kind. Remember how many people depend on you. Your employees are counting on you to save their jobs. Your agents need reassurance that they will be able to sell homes and earn a living again. Your demeanor and your words will convey your interest in them or not. The first, showing you care when the going gets tough, builds loyalty. And hopefully reflects your core belief and not just your strategy.

In a week we enter 2021, then maybe another lockdown. As a city and an industry, we are more informed and less scared than ten months ago when it all started. But we still have to keep evolving. As leaders, we continue to learn what our agents and employees need from us most. In times of crisis, companies stand or fall on the ability of their leaders to offer good solutions.

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