Author Stefan Swanepoel began writing a series of Trends Reports in 2006. His 2019 report does not disappoint. The report chronicles the top 10 trends that he recognizes as material topics for our industry to think about. Swanepoel believes that this year will be “the single largest industry transformation in living memory.”

The 10 Significant Trends That Were Identified Are as Follows

10) The Residential Real Estate Brokerage Shift
9)   The Evolving Real Estate Value Proposition
8)   Blockchain + Real Estate
7)   The Digital End-To-End Real Estate Transaction Dream
6)   The NAR – Broker Relationship
5)   Real Estate Data Standards
4)   Understanding the Housing Supply Crisis
3)   The Brokerage Technology Conundrum
2)   The Future of Real Estate Artificial Intelligence
1)   Mapping the New Residential Real Estate Brokerage Landscape

My first impression of this year’s Trends Report is specific to design. It is laid out beautifully. Nice job Tinus Swanepoel and Jennifer Tumala. This makes reading the report a much more pleasant experience than many reports of this nature. I think that it also makes the report an exceptional business gift for real estate leaders or office managers. Design also has the attribute of encouraging display around offices, and invites people to pick the report up and browse.

Swanepoel also does a nice job of positioning trends in a historical perspective to illustrate the evolution of the trends he is calling out in the report. Understanding where we were as an industry is vital to recognizing where we are and where we may be going. I often think that many startups would benefit from these types of insights. Every year, we talk to several entrepreneurs who “had the experience of a real estate transaction and decided to start a technology company to fix a challenge they faced in their one experience.” It is always disheartening to share with them that their innovation or idea of disruption has been tried time after time before to little or no avail, or exciting to let them know that they really did come up with something breakthrough.

I would pick trend number three as the best chapter in the book, The Brokerage Technology Conundrum. It is influenced by trend number seven – The Digital End-To-End Real Estate Transaction Dream and trend number five – Real Estate Data Standards and trend number two- The Future of Real Estate Artificial Intelligence. Today, brokers really can get their technology solutions to talk to each other and work together. The ability to map data from one piece of software to another has been around for a long time, but all of the integrations were custom – making them expensive and time consuming to deploy and maintain. Companies like Crye-Leike, Fox and Roach are deploying now. A handful of other Realty Alliance firms are getting really close. We expect these firms to separate from the pack in 2019 because they have a truly differentiated solution that agents and teams cannot buy on their own. The ability to deliver integrated systems will be the single-most significant tactic to recruiting and retaining agents.

I would argue with Stefan that 2019 will be the largest transformation in living memory. I believe that 2019 will be a sluggish year, and the basis for my belief is outlined in trend number four – namely the Housing Supply Crisis. “The US in in the longest housing shortage in the modern era, and brokers and agents are feeling the impact. Despite a thriving economy and intense buyer demand, sales are lagging, buyers cannot find affordable homes and potential sellers are staying put because few to no homes are available should they sell.” Simply stated, if we do not have unit volume and strong broker dollar, transformation will languish because there is not enough money.

Coming out of the recent recession, real estate became an exciting business again. Brokers were profitable. We saw a major rebound in housing values that corrected for the losses that spun the industry into the foreclosure nightmare. That rebound made real estate attractive to the capital markets and they invested handsomely. Now the market is shifting again from investing in growth to investing in value. That means that investors are looking for companies who are making profits. And, the truth is that very few of the companies that saw huge appreciation over the past 5 years for their growth in revenue will need to pivot to showing profit – and many of those companies have never been profitable.

As always, the 2019 Swanepoel Trends Report is a must read.