Attend the event July 30-August 1 at Inman Connect in Las Vegas! Seize the moment and take control of the next era of real estate. Through immersive experiences, innovative formats and an unparalleled lineup of speakers, this gathering becomes more than just a conference, it becomes a collaborative force shaping the future of our industry. Grab your tickets now!
A crisis in the real estate sector appears to be imminent. Recessions, regulatory changes, natural disasters, wars, social unrest—these unforeseen events have the potential to disrupt markets, impact your day-to-day operations and challenge the stability of your real estate business.
The current market panic is focused on commission issues after the National Association of Realtors announced settlements for most of its commission cases involving commission decoupling, removing commissions from the Multiple Listing Service (MLS) and requiring signatures before showings Buyer Broker Agreements provide buyers with homes, changing the way real estate transactions are done for decades.
Effective crisis management can make the difference between survival and failure in turbulent times. Here are six key strategies for crisis management.
1. Stay calm and focus on the facts
In turbulent real estate times, it’s important to stay calm and focus on the facts to effectively control the situation. Avoid panicking or making impulsive decisions based on fear.
Instead, gather all relevant information and focus on understanding the root cause of the crisis.
Knowledge is power, and understanding the wider context and identifying the actual situation can help reduce panic. By staying calm and making decisions based on factual information, you can better deal with challenges and work toward workable solutions.
2. Establish open and transparent communication channels
Establish lines of communication with all relevant parties including customers, employees and stakeholders during times of crisis.
Keep them informed of the situation, any potential impact on the real estate transaction, and the steps being taken to address challenges, ensuring transparency and collaboration. Transparency promotes trust and helps reduce rumors or misinformation that can exacerbate problems.
3. Rely on your trusted network
Relying on the support and guidance of your trusted network can be invaluable. Your network of colleagues, mentors, and industry peers provides a wealth of experience and diverse perspectives to draw from.
SecondBy connecting with individuals across your network, you can gain insights into market trends, navigate challenging situations, and explore innovative strategies to adapt to changing conditions.
Additionally, your trusted network can provide emotional support and encouragement, fostering friendships and a sense of togetherness in the real estate community, ultimately strengthening your ability to overcome challenges and thrive in the face of adversity.
4. Have a proactive risk management process
Develop a robust risk management strategy to identify and mitigate potential risks to the brokerage’s operations and financial stability.
This may involve conducting regular risk assessments, implementing contingency plans for various scenarios, ensuring adequate insurance coverage to protect against liability, and developing business continuity plans to ensure that essential functions can continue to operate during any crisis.
By maintaining operational flexibility, real estate brokerages can minimize disruption and maintain customer trust.
5. Establish written policies and procedures
It is critical for real estate brokerages to develop and implement written policies and procedures to ensure consistency and compliance in their operations.
Clear policies provide guidance to agents and employees, reduce misunderstandings and minimize the risk of errors or inappropriate conduct.
Additionally, documented procedures help maintain professionalism, enhance accountability, and establish a framework for effective problem-solving when faced with complex situations.
6. Create and implement flexible business models
Real estate professionals must remain agile and adaptable to respond to the ever-changing crisis. Flexibility in decision-making and the ability to adapt strategies to changing market dynamics are critical to navigating turbulent times.
Implement a flexible business model to adapt to changing market conditions, including adjusting commission structures or exploring alternative revenue streams such as referral partnerships or affiliate programs.
Embracing adaptability, being patient, and reframing challenges as opportunities for growth can ultimately help individuals navigate the volatile real estate market with confidence and resilience.
7. Invest in technology and training
Leverage technology to streamline processes, enhance customer engagement and improve operational efficiency. Invest in training programs to upskill your employees and ensure they are equipped to respond effectively to challenging market conditions. Despite short-term crises, staying ahead of industry trends can set brokerages up for long-term success.
In an unpredictable real estate market, crises are inevitable. However, by taking proactive steps and implementing strong crisis management strategies, industry stakeholders can reduce risks, protect assets and preserve long-term value.
Preparedness, resilience and adaptability are key principles underpinning effective crisis management in real estate, ensuring organizations can weather the storm and emerge stronger from adversity.
As the Head of Inclusion and Belonging at Keller Williams Realty International, Julia Lashe Israel Provides advice, training, and coaching to leaders, team members, and agents to recognize and respond to diversity, equity, and inclusion opportunities and challenges across the organization.
