This week on RealTrending, we are bringing you a special crossover episode of the Top of Mind podcast, hosted by Altos president Mike Simonsen. Mike chats with Jason Waugh, president of Coldwell Banker Affiliates, about how the real estate brokerage model is evolving and what that means for agents, buyers, and the future of the industry.
Jason shares insights from Coldwell Banker’s 100,000 agents, the shifting dynamics of consumer representation, and the lasting impact of the 2024 commission settlements. He also discusses luxury market trends, the critical role of buyer agreements, and why brick-and-mortar still matters in a hybrid world.
Here’s a glimpse of what you’ll learn:
What it’s like running an iconic real estate brand in 2025
The latest findings from CB’s Global Luxury Trends report
Notable demographic trends for luxury real estate buyers
How agent/homebuyer relationships are changing after the commission lawsuits
Which consumers continue to choose full-service/full-price real estate services
Which markets are noticing commission compressionInsights on today’s unique commercial real estate trends
Related to this episode:
Coldwell Banker Affiliates
https://coldwellbankerconnections.com/affiliates/
Jason Waugh | LinkedIn
https://www.linkedin.com/in/jasonjwaugh
Enjoy the episode!
The RealTrending podcast features conversations with the brightest minds in real estate. Every Monday, brokerage leaders, top agents, team leaders, and industry experts join us to share their secrets to success, trends, and the lessons they’ve learned. Hosted by Tracey Velt and produced by the HousingWire Content Studio.
Jason shares insights from Coldwell Banker’s 100,000 agents, the shifting dynamics of consumer representation, and the lasting impact of the 2024 commission settlements. He also discusses luxury market trends, the critical role of buyer agreements, and why brick-and-mortar still matters in a hybrid world.
Here’s a glimpse of what you’ll learn:
What it’s like running an iconic real estate brand in 2025
The latest findings from CB’s Global Luxury Trends report
Notable demographic trends for luxury real estate buyers
How agent/homebuyer relationships are changing after the commission lawsuits
Which consumers continue to choose full-service/full-price real estate services
Which markets are noticing commission compressionInsights on today’s unique commercial real estate trends
Related to this episode:
Coldwell Banker Affiliates
https://coldwellbankerconnections.com/affiliates/
Jason Waugh | LinkedIn
https://www.linkedin.com/in/jasonjwaugh
Enjoy the episode!
The RealTrending podcast features conversations with the brightest minds in real estate. Every Monday, brokerage leaders, top agents, team leaders, and industry experts join us to share their secrets to success, trends, and the lessons they’ve learned. Hosted by Tracey Velt and produced by the HousingWire Content Studio.
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NewsTranscript
00:00The real estate industry is changing at a rapid pace right now. Today, I am showing you a crossover episode from the Top of Mind podcast with Mike Simonson featuring Jason Waugh. He is the president of Coldwell Banker Affiliates, and he goes into all of the latest trends in global luxury market and some other real estate trends that you'll like to hear. So thanks for listening.
00:26Mike Simonson here. Thanks for joining me today. Welcome to the Top of Mind podcast. If you follow along with Altos Research, you're probably familiar with our weekly market data video series. With the Top of Mind podcast, we seek to add context to the discussion about what's happening in the market from leaders in the industry. Each week, of course, Altos Research tracks every home for sale in the country, all the pricing, all the supply and demand, all the changes in that data.
00:53We make the insights available to you before you see it in the traditional channels. People desperately need to know what's happening in the housing market right now. So if you need to understand the housing market across the country or communicate the market to others, go to altosresearch.com and join us.
01:13You can set up a free Altos account right now. Dive in. We can review your local market and teach you how to use market data in your business.
01:21Okay, so in speaking of informing your clients with great data, I've got a terrific guest today, Jason Waugh.
01:28Jason is president of Coldwell Banker Affiliates for Coldwell Banker Real Estate, where he runs the brand's marketing, franchise, sales, and operations for 100,000 real estate professionals in more than 2,700 offices in 39 countries.
01:47So we're talking today from a boots-on-the-ground perspective, running a brokerage in this crazy market, 2025, and this very different legal world.
01:58So lots to cover today. So Jason, welcome to the show.
02:03Mike, thanks for having me. I'm a big fan of yours, and everybody should be a subscriber to Altos Research.
02:09So thanks for having me. Happy New Year.
02:11All right. I appreciate that. Happy New Year to you too.
02:14Okay, let's start at the top. Coldwell Banker is an iconic brand in the real estate world, but that world's changing really rapidly.
02:28So what's it like running like an iconic real estate brand today?
02:34Yeah. You know, it's interesting because I'm really attracted to legacy brands, whether it's our industry or other industries.
02:41And I often say this is the most iconic brand in real estate.
02:46But, you know, there's a famous quote by John Maxwell that I live by, and it's,
02:53change is inevitable, growth is optional.
02:55Change is inevitable, growth is optional.
02:57So while we enjoy the richest history in real estate, we also know that we've got to always be adapting,
03:05always be growing. And so from the top down, from our parent company anywhere, all the way down through Caldwell Banker,
03:14it's really been, you know, leaning into the history, the experience.
03:21We've obviously navigated many different real estate cycles in markets,
03:25but we also know that we've got to be flexible and nimble enough to adapt to not only the needs of the consumers,
03:32but the need of our real estate professionals.
03:35And so we've, you know, really, again, leaned into our experience in our history and fall back on
03:41navigating a lot of different market cycles and economic conditions,
03:46but also being nimble and flexible enough to adapt to an ever evolving landscape.
03:53And when you say growth is optional, where are the growth opportunities,
04:01where the growth vectors for Caldwell Banker these days?
04:04What's like, it's a hard market to grow in.
04:07So tell me where you guys are growing or where you seek to grow.
04:10Well, we, you know, certainly diversification of business.
04:13So we have a great commercial brand in Caldwell Banker Commercial.
04:18That's an opportunity for our affiliates to diversify their business.
04:22Certainly when you look at all of home ownership, not just brokerage,
04:28but all the services that impact a transaction and ultimately the consumer's experience,
04:35you're talking about title and escrow, mortgage, insurance.
04:40So having a diversified set of deliverables to ultimately create an exceptional experience
04:48is really who we are, and that's in our DNA.
04:51And so, you know, we pride ourselves on being a, at least on the residential side,
04:56a home services, home ownership experience.
05:01And on the commercial side, we've got a great platform led by Dan Spiegel of Caldwell Banker Commercial.
05:07Cool. Cool. I'm interested in diving into commercial in a few minutes
05:13because there are trends there that I only have a real surface knowledge of.
05:18So I'd be really curious about what you see on the commercial side.
05:21So it's like 100,000 agents.
05:24And tell me, like, I think at the national level, a couple of things have happened post-pandemic
05:35in the last three years, certainly the mortgage industry, fewer professionals.
05:40I think, like dramatically fewer mortgage professionals on the real estate side.
05:48I think we have fewer, but is it dramatically fewer?
05:52Is it like, what is the dynamic going on with the number of real estate agents now?
05:57And especially after August of last year, tell me what's going on in that world.
06:02You know, it's fascinating.
06:04There hasn't been this mass exodus from the business.
06:07And when you think about it, we're two and a half full years into what I've described as a market recalibration
06:14after a decade of historic growth, right?
06:16And so, you know, we're five months away from three full years of, you know, that, again, recalibration.
06:25And I would have expected, and I think most people would have expected, greater attrition.
06:30And we just haven't seen that.
06:32So I think that speaks to the appeal of this business.
06:39I think it's the greatest business that there is.
06:41And there's always going to be opportunity.
06:43I mean, the headlines are now reading, you know, the fewest number of sales in 2024, in 29 years.
06:52And, you know, but it was still over 4 million transactions, existing home sales.
06:59And that's just, you know, the transaction.
07:01There's two sides to it.
07:02So that's 8 million opportunities to be involved in a real estate transaction on existing home sales.
07:07So there's always going to be opportunity to achieve your goals in this business and impact a consumer's buying or selling experience.
07:18And so there's just going to be, it is surprising that the numbers have stayed elevated in terms of membership, given the last two and a half years.
07:28But I think also it speaks to just the appeal of the industry and the opportunities that it presents.
07:35Yeah.
07:36So, like, the reasons that people become real estate agents, professionals, is because it offers lifestyle flexibility.
07:47It offers, like, personal connection kind of work.
07:50And it has some, often some decent money upside.
07:56Yeah, absolutely.
07:56I mean, you know, 30 years in and around the business.
08:00And I'm an SOB, meaning the son of a broker.
08:02So, you know, of my 50 years, you know, on this planet, you know, 43 of them have been exposed to the real estate business.
08:11And I've always said, you know, there's not very many industries, and I'm a reformed lawyer as well, that there's not a lot of industries where you get to help navigate and be really instrumental in navigating someone through probably the most significant financial investment or transaction that they'll be involved in and make a very good living doing it.
08:36And the ceiling is self-capped.
08:39So, there's just not a lot of industries like that.
08:43And it's why I will always believe this is the greatest business that there is.
08:48That's cool.
08:48So, has that, has the vibe changed?
08:52Has the, has the economics changed?
08:55Has, like, what has changed since August of last year when the big lawsuit, you know, came in, the big, the big judgments came in, limiting how the structure of, how the buy side agents can get paid?
09:15Tell me from the agent perspective and opportunity perspective.
09:18Let's talk there first before we talk into the deal.
09:21It's interesting.
09:22I think it's still a little too early to, to really, truly appreciate or understand the impact of that.
09:29I think the next several quarters, next two or three quarters, we'll probably have some, some greater conclusions and takeaways.
09:36But one takeaway is it wasn't the same experience for everybody.
09:41I mean, there were certainly markets across the country that were further along, whether it be in implementing and using buyer services agreements, whether the MLS allowed buyer agent compensation or not.
09:57So, it hasn't been the same experience across the board.
10:02At a macro level, I think at the end of the day, what it ultimately did was we all just got to get better at what we do.
10:11We've got to have more meaningful conversations around representation and what those services are and then how we are compensated for those services.
10:23I was talking to one of our affiliates in Georgia two days ago and I asked her that same question that you asked me.
10:30And she's like, it's business as usual with the exception of the MLS.
10:34We, we don't disclose what we're going to offer a buyer's agent comp.
10:38You look, I spoke with one of our affiliates in a part of Wisconsin and they're starting to see a greater impact on the actual compensation.
10:48So, it's not the exact same experience across the country, but I think what we all have to acknowledge and accept is change is inevitable, growth is optional.
11:02We all got to just get better at what we do and be able to articulate our value proposition and justify, you know, fair compensation for it.
11:11I do think that we underestimated the consumer's understanding of the process and the system.
11:22I mean, we, we do enjoy the most transparent system, meaning transacting real estate anywhere in the world.
11:29And so, I think some of this was, we underestimated the consumer, especially the seller's understanding of the structure and how it worked.
11:40Because we haven't seen a significant, meaningful change in the practice, certainly the mechanics, but the overall economic impact, we haven't seen any significant changes yet.
11:56Yeah, that's really fascinating.
11:57And, and, and, and the local observations are actually pretty insightful.
12:02And, and as we do work here at Housing Wire on, on that topic, you know, that we are looking at local differences.
12:12And you mentioned buyer services agreement.
12:15And, and I know anecdotally went through colleagues, the ones that previously used buyer services agreements for their buyer clients have no change at all in their business.
12:26And so, and so those who didn't have that, and, and I don't know, like, you know, what are the dynamics where you end up with that?
12:34I'm not, I don't know.
12:35You know, you know, the, like, what were the local customs or, you know, what, what required that?
12:42Why Wisconsin, for example, didn't have that?
12:45Or maybe it was just one person in Wisconsin.
12:46Like, it's really a, a, a tricky, fascinating scenario.
12:50So, um, over time, it will be really interesting.
12:55We're, we're at Housing Wire looking, we're gathering a bunch of different sources to, to, to, like, try to measure those, that, that, that impact.
13:03And, and, and can we see it happening in, in, in different regions?
13:06Have you found, uh, when you do the, you know, the, the recommendations for folks, um, in this new world, um, there have been a few different approaches on how you structure, uh, that.
13:23And, and some, uh, some folks are doing the, the, the, the, I'm a seller, we will entertain any and all offers, put it in the offer.
13:36And some are putting some other contract in place.
13:39And I think it was Colorado had, had some specific, uh, like approach that they were trying.
13:46But, uh, what's your recommendation to agents these days on the sell side?
13:52Yeah.
13:53I mean, at the macro level, right?
13:55Like there's going to be some nuances based on just your hyper local, um, you know, marketplace, but at a macro level, it still is always going to boil down to the conversation and dialogue that you have with the seller, create what their present, what the options are and why, you know, whether it's to, um, market the home on the MLS or not.
14:20That's, you know, an issue that is, uh, pretty prevalent today offers a compensation, the benefits of doing it or not doing it.
14:29And then mechanically how you make it a part of the contract.
14:32I think it really still just boils down to having that really candid upfront, transparent conversation, give the consumer, specifically the seller, what all of their options are so they can make a good informed decision and, and have them direct us as their representatives to, to present to the marketplace.
14:54So, okay, that's great.
14:57Um, so that is on the, the, the agent and consumer side, um, in the deal structure, uh, are you, are there any trends that you've been able to notice yet?
15:12So, for example, like, uh, you, so you mentioned that the folks in Wisconsin felt like they, they were seeing margin compression.
15:21Um, are, are there other trends or changes that you see?
15:27Um, and let me give you an example.
15:29Things that have been on my mind were that, um, as we made it, um, you know, the, the ruling essentially makes it, uh, potentially harder for buyers,
15:42agents to be paid, which, which means that maybe we'll use buyers agents less frequently to my mind as a, it, that, that impacts first time home buyers more make puts them in a worse position than say, um, you know, uh, an institutional buyer who buys thousands of homes, um, and, and knows how they're doing it.
16:06Have you seen anything like that where you go, this is a trend positive or negative or different?
16:12What do you see?
16:13Yeah.
16:14Well, first let me just clarify, cause you referenced that Wisconsin, not the entire state of Wisconsin.
16:19One conversation.
16:20I just saw, I was talking with one affiliate and actually in a secondary market, a second and third home market and starting to see some different practices.
16:28Oh, that's interesting.
16:29Right.
16:29So, so yeah, that's great.
16:31That's a good point, right?
16:32It's not, not the entire state.
16:33It was one, it was one conversation, um, but in a second home market.
16:38So this is interesting to me.
16:39Right.
16:39So now it's in, in a second home world, you might imagine you got somebody who's like, has less urgency to buy, who is like, here's what I'm doing.
16:52Right.
16:53If you want to, you know, like it, you might, you might see it in a second home market.
16:56So that's an interesting, uh, potential place.
17:00Anything else like that?
17:01So, and so back to, uh, thank you for allowing me to clarify that.
17:05Um, you know, I think with, with respect to just overall trends and changes is still, I think it's a little early to draw any meaningful conclusions.
17:15One, one way or, or the other, I will most, uh, surveys.
17:22And I think it's a growing trend that the consumer values the representation of a real estate professional.
17:28And so there's always been folks that either, uh, ended up self-representing or a real estate professional represented both sides.
17:40But the vast majority of times, you know, each principle has their own representation.
17:46I think that's going to continue to be the trend irrespective of, you know, the mechanics of how compensation is, is shared or distributed.
17:56I do believe that the consumer ultimately values the representation.
18:02I mean, the data supports that and that's going to continue.
18:06It's just really the mechanics of how ultimately, um, you incorporate compensation into the transaction is, is really the biggest shift.
18:16Yeah, that's true.
18:18And I think that's an, uh, an excellent observations, certainly one of mine in the 20 years that I've done, I've been doing Altos research now, almost 20 years where it's, um, uh, the one thing I've realized is, you know, people, the outside world blows into real estate every once in a while and says, oh, realtors are overpaid.
18:37Um, and then they continue to opt for full service.
18:42Like they continue to choose to buy, to pay the full service because they want that.
18:48And, and, uh, and there are some people and some circumstances where they want a cheap, uh, low service thing, but it turns out that, uh, like over and over and, you know, I'm here in Silicon Valley and I, you know, I know that the zip realty first internet brokerage back in 1997 had a realtors are overpaid and they're pitched to the venture.
19:12Like it's been a long time and yet we keep, we keep upgrading.
19:16So, because we, because it turns out consumers actually choose the full service.
19:22Yeah.
19:22Well, I think it, listen, at the end of the day, we, we work in an asset class that if you make a mistake, you know, it could be pretty, pretty costly and not just, you know, financially, you know, it's not like we're buying, you know, the newest pairs of skis and ski boots.
19:39And, uh, they're uncomfortable after the first day, you know, take them back.
19:44I mean, we work in an asset class that demands a certain level of expertise to successfully navigate, avoid any of the pitfalls along the way.
19:55And so ultimately that's, that's why I think the consumer does value the expertise of their representation because it's a significant, it's a significant event and a significant asset class.
20:10Okay.
20:11That's, that's terrific.
20:12I, I really appreciate that, that insight.
20:14And, you know, maybe we'll do this conversation again in nine months and say like, okay, what, what can we observe now?
20:20And we'll do some data, we'll track some data on the topic, see if things are shifting, but that's really great.
20:24Okay.
20:25There's a couple other things that I'm interested in, in getting your expertise on today.
20:29One is at, in the luxury space, the, I know you guys do some good, uh, uh, research, you know, luxury market research.
20:39And I've just published a report.
20:42So, uh, tell me, first tell me what the conclusions of your latest report are, and then let's talk about, you know, high end and how that's changing and what's going on in that market right now.
20:52Yeah.
20:53Well, we're, we're super proud of our, uh, Cobble Banker Global Luxury Program.
20:57Believe we have the best real estate professionals and, and great assets and deliverables for the consumers.
21:02So you referenced our trend report, which we just released a couple of weeks ago, which we do annually in, uh, pretty interesting takeaways.
21:09I mean, you look at kind of demographic shifts, you look up, certainly there's some pent up demand.
21:15They saw NAR, uh, released last week that sales above a million dollars rose by 35% year over year, by far from a price point perspective, outperformed every other price point last year.
21:29Um, you know, some of the, the features and benefits that that luxury space and that luxury buyer is looking for, those are kind of the takeaway.
21:38So, you know, from a demographic perspective, uh, affluent women, um, are really driving shopping, buying decisions.
21:48Uh, single women are, are certainly outpacing single men when it comes to home ownership.
21:53Interesting data point there.
21:55Women with a net worth of $5 million or more now own over 15% of luxury real estate in the U S and 13, over 13% globally.
22:05Uh, so that, that, that she elite, uh, is, is really starting to, to, to grow throughout that luxury space.
22:15And then Gen X, uh, is, has grown by 10% over the last five years.
22:20So you look at who's buying what, um, you know, age demographic is, as well as gender.
22:27And those were two really significant, uh, takeaways through, through our research.
22:32Yeah, that's fascinating.
22:33And does the single women trend, uh, continues single women continue to outperform single men in terms of economic gains and things like home ownership.
22:45Um, does that change, uh, how Coldwell Banker does marketing does, does business feel like knowing that, that, that women are driving more and more of that, the real estate purchase decision.
23:00I don't believe it changes, you know, how we certainly market our services.
23:06Um, it's just an awareness, um, I think in terms of who the buying public is, um, certainly we believe that everybody deserves the best representation, but it is, you gotta be mindful of, you know, who are the buyers in, in, in what space today.
23:24And, and so that, again, that Gen X is the biggest population of, of folks that, that are buying.
23:30So those folks aged 44 to 59, I believe it is.
23:34Um, and then, you know, single women outperforming single men.
23:37So it's just, again, awareness of, you know, who our consumer or most active consumer is today.
23:44But in terms of delivery of services, at least at Coldwell Banker, everybody's going to get the best, uh, best service.
23:50I think an interesting trend too, in, in, in our report is what people are expecting from these type of homes and really more of this wellness centric lifestyle, um, in, in the homes.
24:03I mean, you look at what were the, the three most important, um, features.
24:09Number one was a spa like primary bathroom fitness studios for whether it's yoga or Pilates or anything like that.
24:18And then, uh, really, really rich landscaping.
24:22So those are the three real drivers between at least the research that in market intelligence that we acquired as far as what this group is looking for from, from those luxury properties.
24:35That's nice.
24:36So I, I just, uh, Gen X here who just remodeled some bathrooms.
24:39So, you know, I like tried to, tried to get a little bit of that spa like feel going on.
24:44Well, didn't you just get married too recently?
24:46I did, yes, yeah, in June.
24:48I got married this, this year.
24:49Yeah, well, congratulations.
24:51And so I'm assuming your, your now wife drove that behavior and decision-making about remodeling, right?
24:55Yeah, man, maybe.
24:59But, uh, yeah, so, um, okay.
25:02That's really fascinating.
25:03And that, the, the spa like primary bath is, um, you know, is like that.
25:08I, I can understand how that's a, um, uh, like an appeal at that.
25:14What's interesting is that's, um, what's not in there is the kitchen, at least in the top chunk.
25:20Well, you know, another thing I did leave out, it's that whole indoor, outdoor living really almost coexisting.
25:27And, and oftentimes that's a feeder from the kitchen, right?
25:31Into, and so outdoor living spaces or outdoor kitchens.
25:34And, and so that has really become a very popular feature having those, those two worlds, if you will, uh, coexist in, in a floor plan and layout.
25:44So, yeah, okay.
25:45That's cool.
25:46That's really, those are really interesting stuff.
25:48Um, um, so, um, so, okay.
25:53So, so you mentioned that, that over a million bucks, uh, outperformed in 2024.
26:01Um, do you have a take on why that is?
26:05Well, I think it's a couple factors, right?
26:07Like we've seen tremendous price appreciation over the last several years.
26:13So, you know, homes that weren't a million dollars a couple of years ago are now a million.
26:18And we haven't, obviously we just still struggle with a, uh, a supply issue.
26:25And so, especially at that, uh, early entry price point.
26:30So I think between price appreciation that we've experienced, uh, in those, what I described as the unicorn years of COVID and then even, you know, 6% last year.
26:41And, and so those properties have just moved into that, that range.
26:48And then we just, again, still have the supply issues.
26:51Where is that, you know, entry price point, um, gonna, gonna come from.
26:56Yeah.
26:57Yeah.
26:57Yeah.
26:57Okay.
26:57That makes a lot of sense.
26:58Okay.
26:59Um, you mentioned, uh, commercial as part of your affiliates growth strategy and, and like opportunity, not just residential and Coldwell Banker for years has done both residential and commercial.
27:13I don't know anything about commercial except that, you know, I live in San Francisco and I'm sitting here going like, is anybody ever going to, you know, buy an office building again?
27:22You know, like what, uh, what can you tell me about commercial?
27:27Yeah.
27:28Commercial.
27:28Well, we've, we've got a great team led by Dan Spiegel at Coldwell Banker Commercial.
27:32And it's, it's really interesting.
27:34I think what we have to, uh, be mindful of is, is the headlines in the media doesn't really fully represent the entire asset class.
27:43Cause in commercial, you've got many, many different, uh, types of, of commercial properties.
27:49And so typically it's just the office building that's sitting vacant in a downtown metro area.
27:54And then, you know, that's the commercial conversation and, and that's not really reflective.
27:59I mean, we are today over office where if you look at, you know, the nineties, we had excess retail space in today, we just are, are over office.
28:09So what we believe we'll see, uh, happen over, over time is where it makes sense.
28:15Some of those buildings demoed because the value really is in the land.
28:19And so that will be redeveloped into, it could be distribution space, multifamily units, other types of, of commercial, but, uh, office buildings are selling.
28:30It's the reality of it.
28:32Prices have had to recalibrate.
28:34And so seeing buildings trade for 70 or 80% less than maybe 10 years ago, that's just a necessary adjustment of, you know, the current landscape and economic conditions.
28:47But, um, quality retail space is, um, in short supply today.
28:53Uh, multifamily is, has performed very, very well.
28:57Industrial has performed very, very well.
28:59So you've got to really look at what specific type of property within the entire commercial asset class.
29:08Cause it's not all the same.
29:09Yeah, for sure.
29:10Okay.
29:11And, uh, I have the, the, the price adjustment makes a lot of sense.
29:16Obviously, uh, I have a, uh, a colleague in San Francisco who, uh, had signed a, an office lease for in, in December of 2019,
29:28a five-year office lease in December, 2019, and then promptly, you know, stopped using it.
29:36Um, they re-signed, uh, in this December at a 65% discount for another five-year lease, uh, with, with opt-outs, right?
29:49So it was literally, and like, you know, the, the building is, I'm sure their building is, you know, half empty now.
29:54And so their landlord was like, whatever we can do to keep you in.
29:57And so literally their rent dropped 65%, uh, in that period.
30:03And that actually gets me to, uh, you know, a question like, I remember doing this back in 2008, 9, 10.
30:11And, and in that period, there were, uh, folks, the early folks who were doing the institutional buying of single-family homes,
30:22uh, that the whole institutional single-family rental class started in 2010 when there were people who were like,
30:29man, these cap rates are insane.
30:32I can get things super cheap.
30:34Um, and everybody else in the world was like, no, I, I, I'm never buying another house again.
30:40So, um, so are we at a point?
30:45Are we, are we at the 2010 point for offices?
30:49Well, I mean, as, as we both know, I mean, how we work has really been dramatically changed,
30:55certainly by COVID and then, you know, post COVID practices.
30:58And let's face it, most people don't want to commute anymore.
31:01Now we will commute for experiences and destinations.
31:05And we see that's where the opportunities may lie, right?
31:08Like let's just take, uh, malls, for example, which was the, the 20th century, most iconic retail property.
31:17Well, we just don't shop like that anymore.
31:19And so those have got to be repurposed or, or, or, or just, uh, dealt with differently.
31:26But these lifestyle centers anchored by the, the most quality and best brands, those are
31:33still attracting tenants and attracting consumers, uh, because again, we may not want to commute
31:38to downtown for, for work, but we will commute somewhere for a dining experience and experience
31:45out.
31:45And, you know, then that may also include some shopping.
31:49And, and so those sort of, um, transformations in those properties we're seeing very, very
31:56popular.
31:57Yeah.
31:57Okay.
31:58All right.
31:58That makes a lot of sense.
31:59Um, uh, I had a quick, Oh, here's a quick thought.
32:04Let one last thought on commercial.
32:06And this one is sort of, sort of personal to Coldwell Banker.
32:09Uh, you have 2,700 offices around the world that you run, uh, or support, uh, is that growing
32:23or shrinking?
32:25So office consolidation certainly is on top of everyone's mind is, as well as, you know,
32:33even how agents use their office space.
32:36Now I'm a big believer going back to the full service experience.
32:42I'm a big believer in, in brick and mortar.
32:45Now the days of being on every street corner are, that doesn't make economic sense in terms
32:52of how we use space.
32:55But I will, our findings have been people still, especially in, I mean, this is a relationship
33:02business, not just with the consumer, but with each other.
33:06So coming together, idea sharing, collaborating, challenging, encouraging each other.
33:12I mean, hard to do that virtually or in your home office.
33:17So there's still a real commitment to brick and mortar and the value that it brings in collaboration,
33:25idea sharing, culture.
33:27Uh, culture is a big, big part of, of Coldwell Banker.
33:30And, and it's harder to create that virtually.
33:34And so, you know, is, is our footprint shrinking from the total number of offices?
33:41Yeah.
33:41That's very strategic though, but there's still a commitment to brick and mortar because of
33:47the value that it brings culturally for the internal operations, but then also visibility,
33:53visibility, uh, for the consumer and, and making that an option to meet at versus meet at a
34:00Starbucks or some other, some other place to meet.
34:03So we, we believe there's still tremendous, tremendous value in, in that existence.
34:09Okay.
34:09So that, that makes a lot of sense.
34:11That sounds very strategic to me.
34:12It's like, there are probably fewer offices, uh, but they are, uh, more strategically important ones.
34:21Um, and, uh, and the, um, and so that, and, and I noticed it sounded like you, you, you, you focused
34:32the internal benefits of, of that office more than the external benefits, although you mentioned
34:38the, the consumer facing ones as well.
34:41Yeah.
34:41You know, this could be an isolating business.
34:44Let's face it.
34:45If you're just left to your own devices at your home, you can feel like you're the only
34:49person navigating a particular issue.
34:52And so, and, and virtually it's just, it is just harder to connect and it's harder to
34:57stay focused.
34:58You know, it's, it's easier to multitask virtually than when you're sitting in a, in a room with,
35:04with your peers.
35:05And, and again, just the, the energy and the excitement and the enthusiasm.
35:11And the idea sharing, encouraging, challenging one another.
35:14It's just better from the office than it is anywhere else.
35:20Yeah.
35:21Okay.
35:21I like that.
35:22And I think you're not, you're certainly not alone as, you know, business leaders, CEOs
35:27who are like, feel that important part, the culture development.
35:31I know at housing wire, the headquarters is Dallas and, and we're doubling down and building
35:37out a new office space for housing wire.
35:39And, and, uh, you know, I'm out here, you know, by myself in San Francisco, but, but I
35:44even have an office that I like to go into to, to have my creative space and, you know,
35:48have my good microphone and stuff.
35:50Yeah.
35:51Yeah, absolutely.
35:52That's great.
35:52Um, okay.
35:53Let's talk about, um, let's talk about M and a, one of the things that I find fascinating
35:58about the brokerage world and especially in the, in the last, I mean, it's always been
36:04the case, I think, but in the last, uh, decade, the, the biggest, you know, big, one of the
36:11biggest changes, uh, has been compass.
36:14One of your competitors compass who raised a bunch of free money in the zero interest
36:20rate, you know, dot com world from, you know, soft bank and, and, uh, and went out and bought
36:27a bunch of market share.
36:29Um, and, uh, and so tell me about what's happening in brokerage M and a, um, and, and where, how
36:42you look at that.
36:43Yeah.
36:43Um, well, you know, I think, you know, with respect to competitors, I, I, I look at that
36:48as just different business models and there's always going to be disruption in, in folks
36:53looking at opportunities, uh, in the business and, you know, that specific company that you
36:59referenced has bought their way into the market.
37:02And, um, I think, you know, again, for us leaning into 118 years, uh, in, in, in business
37:09and, in our experience, I think from an M and a perspective, it's the fundamentalist
37:13fundamentals remain the same.
37:14And it's just really about timing and opportunity.
37:18And if the timing and opportunity align, then magic can happen.
37:23But there's certainly, you know, we had a 10 year historic run.
37:28Um, there was a lot of, a lot of movement between companies.
37:31Then now we've recalibrated the last two and a half years.
37:36I, I believe we're going to see more and more opportunities.
37:39Um, some of it, just aging demographic of ownership, some of it, you know, market and economic driven,
37:46and then just time.
37:47So for us, it's really about making sure that we're talking with, um, everybody in, in the
37:55business.
37:56And if there is the right time and the right opportunity for us to come together and there's
38:02great synergies.
38:03And this is where going back to culture, culture matters.
38:07I mean, for something to be sustainable long-term, not everything's going to be a right fit, but
38:13you have to be, make yourself available to all those opportunities to explore if there's
38:19a right fit.
38:20So I think that the timing of the market, the economy is on, is favorable to, to the M and
38:26a space here over the next, you know, 12, 18, 24 months, uh, probably.
38:31And, and so for us, it's really about partnering with our franchisees around their growth strategy
38:39and really helping them either with introductions or valuing opportunities and then navigating
38:49that process from actual close to then onboarding, because ultimately you want to keep continuity
38:55of, of those assets, meaning the businesses and making the, a seamless transaction, uh,
39:02for the, the end user, which in, you know, our businesses deal the agents.
39:06And so hopefully it's, it's seamless for them, but I see a, a, a great window of opportunity
39:12in the M and a space over the next 12, 18, 24 months, given the last two and a half years
39:19of, of the market.
39:20Got it.
39:21So when you say opportunity for M and a, this is really your franchisees are growing their
39:27businesses by buying other brokerages nearby complimentary.
39:33Is that right?
39:34Yeah.
39:35And we'll evaluate, we'll evaluate, um, opportunities on the company owned side, but you know, it's
39:44really, so it's, it's, it's, it's, you know, we've got kind of two paths there, right?
39:48One company owned and then one, our franchise franchisees.
39:52And I think there's tremendous opportunity for our franchisees that have an appetite and
39:58a willingness to, to grow, uh, because again, those, those opportunities are going to be
40:02really hyper local, a lot of synergies that, that they're local.
40:06And, um, and again, I think two and a half years of, of the current market conditions that
40:11we've been in have, uh, have created a great window of opportunity.
40:15Yeah.
40:15So, and, and you, you mentioned demographics on that.
40:19So it's like, these are like brokers who've been in the business for 40 years and they're
40:23now looking for an exit.
40:25Yeah.
40:26And we want to be, we want to be that business partner.
40:28That's an end to end solution, right?
40:31Join Caldwell banker.
40:32We will help you with your growth goals throughout your active career.
40:37But on the backend, we also want to be a good business partner and create a succession plan
40:42where hopefully you have a, a, a significant financial, uh, event there to close it out.
40:49But we also create continuity in that asset and it just continues to go on for the next
40:55decade, two decades, three decades, whoever the owner operator is.
40:59So we, we believe we are the premier provider of that end to end solution and not just on
41:06the front end during, during their, their growth, active cycle of, of the business.
41:11When, uh, over the, over the last couple of decades that, that I've been paying attention,
41:17it's been really fascinating to me.
41:20Uh, you know, because I'm a Silicon Valley guy who stumbled into real estate as opposed
41:25to being a son of a broker, you know, a lifelong.
41:28And so, so for me, it was watching the brands in, you know, in, in Northern California, there
41:36was a lot of, um, regional brands, San Francisco strong brands, uh, you know, Bay area brands,
41:43uh, that, uh, grew and had market share.
41:46Uh, and, um, meanwhile, there's some big, you know, mega at Colo bank has been there a
41:53long time, but in the last 20 and 30 years, there's been some ebbs and flows of other
41:57brands that come in there.
41:59Um, are there trends at the brand level?
42:02Like, are we getting fewer regional brands?
42:04Are we getting more of them?
42:06What's happening there?
42:08Well, there, there certainly was a period of time, especially that, you know, mid 2012
42:12coming out of the great recession up until mid 2022, where you just saw a mass entry into
42:20the business and there's been a growth of the teams as well within brands.
42:24And so some of these teams are companies within companies as well.
42:28And so, you know, that's one area of how do you continue to support those folks as well
42:34as the individual entrepreneur.
42:36And so as a, as a brand or any organization supporting different makeups of business models
42:43within your business model, I think the last few years haven't seen as many, um, but that's
42:50again, more probably economic and market conditions.
42:53Uh, but there's, there's more business models in this industry than there's ever been before.
42:59And, uh, and again, it just, it boils down to who do you want to be?
43:04What kind of, um, business partner are you?
43:07And, um, I look at it that, you know, we're a high value business partner and that's who
43:12we want to support.
43:13That's, uh, and then deliver ultimately an exceptional experience to the consumer.
43:18But it is, you know, you kind of got two camps, low cost and limited services, which is just
43:24a business model.
43:24No criticism on, on, it's just business models from my perspective.
43:28Or you've got the high value, full service, a lot of resources, a lot of systems, a lot
43:34of tools to ultimately pass along to the consumer that benefits from a, from a rich experience,
43:42either buying or selling.
43:44Yeah.
43:45Yeah.
43:45Yeah.
43:45Yeah.
43:45And, um, the right, the, the different business models are really fascinating.
43:49The rise of the teams in the last 10 years, uh, and people are scaling businesses, scaling
43:57like, I am a real estate agent with a hundred people on my team is a fascinating way to run
44:03the business.
44:04Yeah.
44:05Um, and, uh, and do you have a, do you have a, uh, uh, uh, take on, on that team's trend?
44:13Is it, are we, is it still growing or is it, is it scaling back any?
44:18I think it's going to continue to grow.
44:20I mean, some of that's going to, and I think that may be, uh, and this is just, you know,
44:25my, my thought, I don't really have any verified data to support it, but when you look at what
44:31I would have expected greater attrition in just realtor count or agent count, the fact
44:38that, that we haven't seen that leads me to maybe speculate that rather than leaving the
44:43business, they joined a team.
44:44And, and so as we've seen the growth of, of teams, that's probably where, uh, we've seen
44:52an impact on just overall numbers of, of membership within the industry.
44:58Got it.
44:59Uh, do you have, uh, do you have a take on the, the, the total number of, uh, agents?
45:06Like there's a, there's a, uh, conventional wisdom that we have too many real estate agents,
45:14right?
45:14There's too many of them.
45:16Uh, do you have a take on, on, you know, the number?
45:22Not necessarily the number, but let's face it.
45:25I mean, there's only so many transactions.
45:27And so last year there was, you know, 4 million 60, you know, thousand existing home sales doesn't
45:32include new construction, but so, you know, there, there is, you know, only so much business
45:40for everybody.
45:40It really just boils down to who is, who treats this as a career and a business versus a hobby
45:51or, you know, something to, to do.
45:54And even if they do that part-time, but really, really well, it's still, you know, part-time.
46:00I think that's, you know, really more kind of indicative of, you know, the number of,
46:06of licensees, uh, versus is there a formula that makes sense based on 4 million, then there
46:13should only be X number of real estate professionals.
46:16I think it just, it really gets down to why are you in the business and, and then, you
46:21know, how you invest in it.
46:24Yeah.
46:25And I, and I'm always of the view that I think that the too many argument is really fascinating
46:29because it's like, uh, it, it doesn't recognize that there are a lot of folks who don't sell
46:37houses, but they find the benefit of keeping a real estate license.
46:42Absolutely.
46:42They're, they're ancillary.
46:44I'm like, I don't know what the number is inside housing wire, but this is a media company
46:48and a data company.
46:48And I know there's, there's a handful of people who have real estate licenses in the
46:53business and, uh, and you know, now they just write about the business, but they keep their
46:59license and it's, and they keep their license to be able to be stay connected and, and, uh,
47:03do things, or maybe you're an investor and you're, maybe you're, you know, like, uh, you
47:09know, you are on a team and you're not, your entire business has nothing to do with actually
47:14doing a transaction, but it is related to the industry.
47:18Yeah.
47:18There's multiple motivations to continue to have a license.
47:21I mean, and let's face it, this is one of those industries that a lot of people don't
47:25retire from, um, and, but there's, there's opportunities to, especially when we look at
47:33not just succession planning for, for broker owners, but agent succession planning.
47:39So how do you marry, you know, folks that are newer into the business and on the, my, my
47:45father used to always say that you're inclining, I'm reclining, meaning he was reclining and
47:50I was inclining, but you know, those, you've got those different stages.
47:54Uh, but that doesn't mean you drop a real estate license cause you can still collect
47:57referral fees.
47:58You still have, you know, a quote unquote, a sphere of influence that maybe now you've,
48:03uh, introduced them to somebody that's, you know, still growing their business.
48:08So to your point, there's, uh, multiple motivations to have a license.
48:14I think it's, it's really, you know, kind of what is again, why are you in the business?
48:19Great.
48:20Uh, let's do this.
48:21We're getting close to the top of the art.
48:22One thing I always like to ask Jason, my, my guess is your vision of the future.
48:27Like suddenly we're in the second half of the decade.
48:30Uh, what's your vision for the, the real estate market, the industry, uh, and Coldwell
48:35Banker specifically?
48:36Well, Caldwell Banker is going to continue to grow and, and, and lead the way in terms
48:41of being the most iconic brand in, in, in real estate.
48:45I think we're certainly going to experience some continued volatility in, in uncertainty
48:51in the space and in the short term.
48:53Uh, you know, I talk awful lot about, I mean, affordability is the, that's the big number
48:58one question.
48:59And I often talk about this, uh, you know, the impact triangle that I refer to meaning mortgage
49:05rates, prices, inventory, and the impact that those three have on, on affordability.
49:10I mean, we have to address affordability.
49:14We have to address, um, supply and supply across all price points, especially that entry price
49:21point.
49:22That is, we, we'd have to, we really have to have some realistic solutions to the supply
49:30side of, of the business.
49:32Um, I, I really don't believe that there's going to be dramatic changes in how we actually
49:38deploy our services, uh, as real estate professionals.
49:43I believe the consumer is going to continue to value the services of, of quality representation
49:50and engage us, uh, in, in that way.
49:52And compensation will reflect the services that, that we provide.
49:56Uh, but as far as the industry as a whole, we have to have meaningful change to addressing
50:03supply.
50:04And again, at that entry price point, but I'd argue across all price points, uh, is really
50:10what the industry collectively needs to, to focus on.
50:14To keep growing.
50:14All right.
50:15That's really great.
50:15I love the, the impact triangle, the, the, uh, uh, mortgage rates, inventory and, and
50:21home prices of the, all of those, uh, those three kick into, into gear here.
50:29Um, well, that's a terrific view.
50:31It's actually like really great conversation and we went, we went all over the place, but
50:34I appreciate the, uh, the boots on the ground view that like seeing, you know, and, and,
50:40uh, seeing what's happening.
50:41And in many ways, the industry is under like dramatic change right now.
50:47And so, uh, I appreciate your, your take and at some of the anecdotes along the way.
50:52Yeah.
50:53It's always a pleasure, Mike.
50:54And I, uh, and I, uh, sincerely meant what I said at the opening and really value your
50:59contributions to, uh, to our industry from a data perspective.
51:02I watch your, uh, your content every week.
51:06And, uh, those of us in the business, we should all do that.
51:09So, you know, thank you for, for what you do and your contributions to our business.
51:14All right.
51:14Appreciate that very much, Jason.
51:16All right, everybody.
51:16This is the top of mind podcast.
51:19If you enjoy conversations like this with Jason, I appreciate a, uh, nice five-star review
51:24wherever you get your podcast that helps other people find us.
51:28Um, and we will be back next week.
51:30The rest, uh, again, with, with another great conversation and, uh, we'll see you then.
51:35Thanks everybody.