The Biggest Challenges Real Estate Teams Face In 2021
We all know that 2020 was a challenging year, but the challenges don’t stop just because the clock strikes midnight, the ball drops, and we enter a new calendar year. Challenges are a part of life, and we’ll have our share of challenges in 2021 too.
The word “challenge” tends to have a negative connotation. Although I’m no optimist (realist right here), I see challenges as problems that need to be solved, struggles that need overcoming, and a whole lot of opportunity to grow as a person, business owner and leader.
I, for one, welcome the challenges that real estate teams are going to face next year. Let’s hit them head-on and get ahead of our competition. Challenges are where the pros show up and where great companies start to separate from the pack.
In 2021, the most significant challenges teams will face stand the test of time. They are the same challenges that companies have every year: time, money and people.
Let’s dive in and see how those timeless challenges show up, what unique problems 2021 might bring, and most importantly, how to navigate through these challenges to get ready for a banner year.
Everyone has the same 24 hours to work with each day, so why are some people more successful than others? It’s because they understand the importance of saying no. They understand that not everything matters equally. And they know how to hold their team members (and themselves) to high standards of productivity.
We’re always racing against the clock — that challenge is never going to go away. What you do with the time that you have is where you can get a competitive edge.
2021, especially in the first half of the year, is going to present us with many of the same challenges we faced in 2020 — home-schooling, partners working from home, home renovations (with increased costs and delayed timelines), and staying up to date on the rapidly changing market, economy, and rules and regulations.
Not to mention, there will likely be even more technological advances to how we work, which brings its own set of challenges to learn and implement these tools. And with every new piece of technology — product or service — comes sales pitches and demo videos competing for our time and attention.
What do we do when we’re being hit from every angle with time-consuming demands from our team, clients, family, vendors, the media and more?
We slow down and get clear. The best way to know how to allocate your time is by clarifying what is most important to you, your team, career, life, and your company’s growth and success.
Although your schedule in 2021 might not look entirely ideal anymore, due to issues outside of your control, keep the most critical things top-of-mind.
If working out, having dinner together as a family, lead generating for two hours and holding a team training every day are the most important activities, then everything else needs to be scheduled or rescheduled around those things.
Make them non-negotiable, and share those priorities with your team and clients. Clearly setting expectations around your time and priorities helps others do the same.
Remember, not everything matters equally. With increased demands on our time and endless Zoom meetings, go back to your list of most important daily activities and say no to everything else.
The biggest challenges I see teams face with money comes down to making poor investment choices and not holding their money accountable.
Let me explain.
When new business leaders are growing a team, it’s tempting to live on the edge of or beyond their means and spend most (if not all) of the business’s profits. And for new or existing teams, real estate was booming in 2020, and most teams had profit — and a lot of it.
The challenge is not to spend it. It’s challenging but doable. Now is the time to double-down on cutting expenses, renegotiating contracts, and extracting as much money as possible from the business to put into reserves.
Now, I say this, but there is a caveat: Knowing when to pull the trigger and invest is essential too. Wading through all the shiny objects (new tech tools that promise you’ll close 100 more deals a year), merger and acquisition opportunities, and even legitimate operational systems or new hire decisions is its own unique challenge.
As real estate continues to be strong in 2021, it will be challenging to decide when and where to invest and when to scale back, cut expenses and build up that reserve account.
I’ve always run a lean business model, and I believe in leading with revenue. Where do I choose to invest? People. People, the right people, will always give you a return on your investment.
It’s not enough to invest your money wisely; teams also need to hold that money accountable. Can you honestly say you are paying attention to where every dollar goes and whether you are receiving a return on that deployment of cash?
If not, it’s time to review where your money is going and make adjustments. Adjustments could mean cutting expenses, increasing ad spend on your most valuable lead generation source, or giving a raise to a team member who has gone above and beyond the past six months.
Although economists predict the housing market will stay strong in 2021, we still have an inventory shortage. And, if this year taught us anything, it’s that we never really know what can happen.
The challenges in 2021? Continuing this balancing act of cutting expenses, holding money accountable, building up reserves, and investing in the right people, products, and services.
One of the biggest challenges in business is people. Having the right people in the right position on your team at the right time. Another challenge is striking a balance between not over-staffing your team and having enough staff to help the team grow (while not overworking current staff).
As I mentioned above, investing in people is one of the best investments you can make — as long as they are the right people and your business can support it.
I believe another one of the challenges in 2021 is going to be the abundance of talent. The national unemployment rate is still the highest it’s been since 2014, at 6.7 percent as of November 2020. It will be tempting to invest in new staff (possibly at a lower salary than they might have demanded a year ago).
But that “discount” on top talent is only a good move if your team needs another hire (see the section above on money).
Stay the course, hold your money accountable, and only invest in a new team member if your team is maxed out and you know that an additional hire will get your team to the next level of growth and profitability.
Also, as we know, listing inventory is going to continue to be a challenge in 2021. I think it will be critical to invest in a high-performing, driven listing agent, or agents, to get creative and take market share next year. We know those teams that control the listings, control the market. Make sure your team is one of them.
The challenges in 2021 will be very similar to the challenges that all teams, companies and business leaders face: time, money and people.
2021 will bring some unique challenges as we continue to navigate the pandemic challenges, such as working from home, childcare, home-schooling, and elder-care needs, and the barrage of new technology to help us all do everything better and faster.
One thing is for sure: These pandemic-related challenges will continue to fast-track innovation and industry trends, separate the great companies from the merely good, and help us all grow as individuals.
Adam Hergenrother is the founder and CEO of Adam Hergenrother Companies, the author of The Founder & The Force Multiplier, and the host of the podcast, Business Meets Spirituality. Learn more about Adam’s holistic approach to business here.