RE/MAX, LLC President and CEO Nick Bailey – alongside other prominent industry leaders – provided insight into the actively shifting housing market, competition among industry brands, strategy for M&A, and more during Inman Connect Las Vegas on August 4.
As both a panelist and a moderator across different sessions, Bailey also discussed M&A for brokerage growth and the best practices to get there.
With so many new real estate agents entering the market over the past few years, Bailey believes those who are determined to see long-term success must reassess their value.
“If you’re a broker, an agent, a vendor, everyone’s taking a deep, hard look in the mirror to say, ‘What is my value?’ Price is only an issue in the absence of value,” he said during “The Empire Strikes Back” session.
As for what brand agents choose to affiliate with to find that continued success, Bailey said that competition in the industry is welcome as it’s up to agents to find the brand that best aligns with their values, their goals, and their need for technology and resources.
“There’s room for every [business] model. It’s the agent who has to find what is the best fit, culture leadership, tools, [and] services [so] that they can prosper in their business.”
This sentiment also holds true for brokerage owners, who are looking to grow their offices exponentially with a brand that supports their growth trajectory.
“I think [growth is] the backbone of every brokerage and every company. And at the same time, sustainability is all about profit,” Bailey said during the “Should You Consider M&A? The Top 5 Things You Need to Know” session.
This, to me, is when disruption happens.
Nick Bailey, RE/MAX, LLC President and CEO
Profit ultimately comes from selling houses, Bailey noted, and one of the most effective ways to create sustainable profit is to grow the size of a brokerage. In conversation with Scott Wright, a partner with RealTrends Consulting, Bailey further discussed the power of M&A for growth-minded real estate entrepreneurs.
“This whole concept of consolidation, mergers, and acquisitions is at the forefront of a lot of minds,” Bailey said.
Wright, too, believes M&A is a critical component of business in today’s real estate market.
“One way to combat that margin compression that our entire industry is dealing with is growth in scale in order to grow those profits. And the top way to accelerate growth is making acquisitions,” Wright said.
Growth is happening for agents, brokers and companies alike. Bailey pointed to the currently shifting housing market as a catalyst for industry change in the year ahead, including at RE/MAX.
“This, to me, is when disruption happens. This is when – in the next six to 18 months – some of the most interesting things will come up in the industry. And we will have even greater speed to some of the evolution because those that are sustainable and profitable [are] going to reinvest in our business,” Bailey said.
“[RE/MAX] made some announcements just a few weeks ago on four key areas where we’re reinvesting in the business to grow during this time.”
The announcements he cites include a heightened focus for RE/MAX on team growth and support, as well as the next phase in the evolution of RE/MAX technology.
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Written by LEAH CURTIS
