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Yearly Archives: 2020
|by Leonard Steinberg|
I know wealthy people rather well. In the USA, ‘wealthy’ is attributed to the 5% worth $2.5 million or more. I have worked with and been around wealthy people all my life and I feel I truly understand what really, really matters to them. These days – more than ever – there are six things that I feel matter to them most as it relates to where they choose to live:
1. Culture: Why make all that money if you cannot spend it on something and enjoy the fruits of society such as art, music, theatre, opera, great food, etc. These are the things that stimulate creativity and fuel enjoyment of life.
2. Health. Everyone knows by now – more so than ever before – that without good health life is very different and less enjoyable. Being healthy and having access to outstanding healthcare is critically important. Access to the best Doctors, Hospitals, nutrition, workout and exercise facilities all matter. Creating a healthy living environment in a healthy city/town/village is an increasing priority.
3. Opportunity: To create, grow and maintain wealth being in a place that encourages, stimulates and nurtures opportunity is vital. These days much of this can be done remotely by investing in far off places, yet the environment wealthy people live in must have a ‘can-do’ spirit, and attract job-creating industries that stimulate growth
4. Taxes. I have yet to find a wealthy person who dreams of paying more taxes. Unfortunately our world has classified all wealthy people as “billionaires who don’t pay their fair share of taxes”. In some areas this is true for the few who have enormous tax loopholes that allow them to pay far less than similarly wealthy people…..who end up paying much more to compensate for this (mostly legal) abuse of the system. Lumping all the wealthy under one umbrella is silly: I know many wealthy people who are quite comfortable paying their fair share of taxes (and some even believe they should pay more!) as long as what they pay in shows real value to the world and their community. Too often tax money is wasted and inefficiently spent.
5. Education: I know of many wealthy people who made a move specifically for schools or colleges. Some have moved towards the cities with the best educational institutions knowing corporations and innovation will follow suit. I feel certain Mike Bloomberg’s investment in the Cornell Tech Campus in New York has helped fuel a tech boom in the city. Business goes to where the talent is.
6. Safety: Most wealthy people simply don’t want to worry (or even think) about crime and safety. Safety may be their most important priority. Any country, state, village, town or city that is unable to deliver safety and security is doomed to attract or retain the wealthy.
All people will prioritize the above differently, but all matter. And all the above matter to ALL people, wealthy and not wealthy. Some of these needs may be offset by a private jet or broadband. If any state, city, town or village wishes to attract – and retain – wealthy people to their area, focusing on the above six items would be prudent and practical. While some may resent the wealthy right now, we cannot ignore some harsh realities: the wealthy pay almost 39% of all federal taxes collected, create businesses, donate heavily to charities, cultural and educational institutions, spend LOTS, create jobs and new industries and invest in them to grow, etc. Some are monsters for sure, but the vast majority are not. Most of us are extremely reliant on the buying habits of the wealthy. Unfortunately unlike most of us, the wealthy have the luxury of mobility and choice, and they will gravitate toward the places that deliver most of the above …..because they can.
Thought that this was a very interesting article and something that you might not know.
|Article by Leonard Steinberg|
My partner Thom told me the funniest story yesterday while we took an early morning walk through the exquisite meadows of Northern Westchester – an hour outside of Manhattan – that was reminiscent of the best in the Cotswolds, Provence or Tuscany (without the jetlag!). The story goes like this:
Once as a kid, he awoke to a similar, perfect-weather day. It was gorgeous. Spectacular. That day was going to be the best day ever. Just before he headed out on that beautiful Summer’s day, he paused reminding himself that Summer was also a time for bugs….. So he and his friends were prudent and proceeded to spray one another with bug repellent. As he depressed that sprayer button to help out his friends – pfffffft! – he realized the sprayer was pointed in the wrong direction and he sprayed his face with repellent, with eyes open. You know the rest of the story. He spent the rest of that perfect day washing his eyes out and keeping them closed to heal from the nasty effects. That day that had all the promise of perfection was dashed in a split second.
This little tale is not designed to get you depressed. But it is a good reminder that what happens at the very beginning of the day does not necessarily determine the rest of that day. Conversely, the day may start out on a bad note and continue to improve through the day, ending on a high note. The great stuff may happen in the last hour or minutes. Likewise, be wary of judging your performance or success by a week, month or even a year. Sometimes you can have a bad year (or even two) and sometimes you can have a sensational year. Neither will determine or define a career.
Yes, I begin every day with an overwhelming sense of optimism and a can-do spirit. I make every effort to make every day the best it can be. But stop being too harsh on yourself when things don’t work out the way you want when you want or expect them to. Know that the roller-coaster of life always delivers ups AND downs. Try to enjoy the experience during both times, knowing roller-coasters never go down or up without a change.
Have a TERRIFIC Tuesday!
Hope you enjoyed this article.
Over the past several years, as many owners of very large suburban homes saw their kids depart for college and elsewhere to become ’empty-nesters’ they were confronted with multiple challenges to sell their homes and downsize or relocate. This market stalled fueled by the desire for more efficiently scaled homes, urban living and the limitation of the SALT tax deductions in the December 2017 tax bill that impacted many of these homes in higher tax states.
Then along came COVID-19, and all of a sudden a new buyer pool opened for larger homes, and this market re-awakened with a bang. What until early 2020 seemed like a ‘dying’ market sector that had experienced dreadful sales volume and substantial price declines in many areas roared back to life. Now these empty nesters have the ability to move on with their lives, relocate to smaller homes more suitable to their space needs, or move back to the urban environments they left to raise kids in a suburban setting. Or move to another location altogether based on retirement needs.
In January, 2018, horrific mudslides devastated parts of Montecito – one of the most beautiful places on earth – following massive wildfires. This week news broke that Prince Harry and Meghan Markle bought a massive house in the area, following extremely robust buying activity in recent months that has consumed much of the inventory that had stagnated for many months. What to some seemed hopeless at one point, is now thriving again.
What do these two things have in common? Time. Time has the capacity to unlock that which may seem impossible or even hopeless. Time heals most things. Time allows us to get a clearer perspective. Time answers unanswered questions. Time allows evolution and innovation to get back on track. Time allows us to forget. No area of the planet – or real estate markets – is immune from some form of adversity. And it is usually time that restores things back to ‘normal’.
Yes time implies the one thing we all lack most….patience. In the waiting, some will panic. Some will predict eternal gloom and doom. Others, however, will wait and see while some will see opportunity, roll up their sleeves and get back to work, taking accurate inventory, evaluating solutions and future mitigation to prevent repeating past mistakes. And ultimately benefit when the stalemate unlocks.
The “GREAT UNLOCKING of 2020” of the stalled large-house market is one example of how all (most) stalled markets turn eventually, some sooner than others.
by Leonard Steinberg
I know I’m going to sound like Pollyanna again……but here goes: I’m SO EXCITED about the next luxury market we are heading into. Why? I have fashion in my genes (I was in the fashion industry for a decade prior to real estate) so newness and change are wired into my DNA. Here are some thoughts on the next luxury markets based on reading and thoughts I’ve gathered over the past few weeks from Bain, McKinsey reports, and the writings of the Wall Street Journal, Jing, Forbes, CNBC, etc:
* Future luxury will adapt after the Corona-virus pandemic. Luxury is not dead and will NEVER die. The desire for luxury in tough times is often greater.
* Research has proved that luxury isn’t overly income-sensitive, nor is it reactive to recessions. Even when people have less money or income, the desire for luxury remains.
* Analyzing past crises confirms that the luxury sector suffered less than others, and it rebounded faster and larger than non-luxuries sectors. Practically all luxury categories have outperformed non-luxury segments since the 2008 recession.
* Luxury brands will have to continue and expand their focus on experiences and storytelling around purpose and values, heritage and authenticity to remain relevant to their newly discerning customers.
* In a world where conspicuous consumption might be less acceptable for a while, prominent logos will recede. A flashy, glitzy brand attached to a home may not matter as much as the home’s specific attributes.
* The more creative style of a brand will come back to the fore with a new focus on discretion.
* Consumers in China that have already begun a path towards a more normal life have cut back spending on frivolous things. Real estate is not considered a frivolous purchase. A home is a substantial and meaningful purchase, more so than a sports car. It is also usable and valuable to your daily existence.
* Digital shopping will expand notably for safety and convenience. Digital experiences MUST be elegant, informative, SMOOTH, and less focused on gimmicks and flashy effects.
* LOCALLY made and sourced anything will be of greater value and should be highlighted. Think LOCAL PRIDE.
* Affordable price-points in anything will have a growing demand as those who could afford more now can or want to spend less…..or may want to lower budgets to accommodate owning a second home.
* Luxury marketers and service providers will need to have to provide more robust intelligence, fast decision making and clearer, to-the-point communication.
* Be relevant to your clientele. Be customer obsessed, agile, digital and sustainable.
* Luxury marketing language should adapt to be softer, less grand. More human. Calming. Substantive content that is informative and aspirational will matter. People are a bit fragile right now and many won’t admit it.
* Luxury brands that can create extreme value become important to consumers, which often see items as investments, helping them to rationalize the purchase and increase their willingness to pay.
* The luxury sector is often based not on a rational decision-making process and reasoning but on emotions and feelings. How does what it is you are selling leave your audience FEELING? Think tone, sounds, smells, sensory qualities as well as facts and data.
* While this unexpected crisis will undoubtedly have a strong impact on societies, it is unlikely to affect the very roots of human nature.
* After potentially months of austerity and isolation, customers may be willing to go back to their lives from before the pandemic and enjoy luxury services including luxury travel, entertainment, food and beverage and spa services. But this will require extreme confidence around safety….and it will take time. Confidence is built and earned.
* Spending in times of crisis tends to be about identity and security. Combining this with the essence of luxury which is often based on conspicuous consumption or at least signaling status, both luxury products and services are bound to be popular again.
* Home as sanctuary of safety and comfort…..and functionality….and now it has an additional necessity: work from home environment.
These are just some initial thoughts on this subject. We will learn much more over the next weeks and months about the shifting tastes of the luxury consumer.
by Leonard Steinberg
Imagine if everyone obeyed the rules. Yes, songwriters and poets would have a field day professing the pain and anguish of how this would limit the human spirit and creativity. Yet at times like these especially we may all want to obey the rules, especially as they pertain to showing property.
Over the next few weeks and months as physical real estate showings will become allowable, rules and protocols will be put into place to minimize risk and create a safer environment for all. We owe it to one another to respect these rules AND any other rules a listing agent may require as they may be coming directly from the owner of the property. No, you may not get COVID-19 from doing a showing. But you may cause someone – simply by not following the rules – to get sick. That should be sufficient motivation for any decent human being.
We are in a moment of uncertainty, dealing with something we have never had to deal with before….and it’s possible some protocols will change and adjust over time. Some may even feel excessive. We owe it to the consumer to feel really safe. This is no time for creative interpretation, selfishness, individualized philosophy or opinion if we want to avoid further spread of this virus. As a profession – and as COMPASS professionals – let’s rise to the occasion and practice and demonstrate real discipline around physical showings. It may be the most outstanding public relations and brand-building….and it may save lives.
I have been listening to lots of people over the past few weeks, analyzing data, thinking, and I now feel confident that we are about to head into a REAL ESTATE FIRESTORM – a good one – and here is my reasoning:
- PENT-UP DEMAND. Never before in the history of the USA have real estate showings been forcefully ceased for an extended period of time. Never. And certainly not for 2-3 months. Pent up demand happens many times through business and economic cycles when people pause or shifts occur…..but showings have never stopped. Add the pause with the ‘wait-and-see’ and you could have DRAMATIC demand when markets open up.
- INVENTORY. In most areas around the country inventory levels keep shrinking. This will escalate dramatically over the next few weeks and months, but 2-3 months inventory deprivation is unprecedented! All markets and pricing are driven by supply and demand.
- LOW INTEREST RATES. They are as low as you can go. Seldom if ever has there been a weak real estate market in a low interest rate environment.
- JOB LOSSES. Yes, millions of jobs have been lost. But the majority of homeowners don’t work at a checkout counter or wait tables. Unfortunately most job losses have been lower salaried employees. Fortunately, a large majority of the COMPASS clientele will not be directly impacted by these job losses and hopefully many of these jobs will come back as the economy recovers and we return gradually to normal. Job losses will impact our economy for sure, and hopefully many/most can be recovered ASAP. This will require new skills in new industries that emerge and prosper. Some industries may experience long term damage.
- GOVERNMENT STIMULUS. Never before in the history of the planet has so much government fiscal stimulus entered the markets. Probably over $9 TRILLION. That’s almost TWICE the size of the economy of Japan, the third largest economy in the world!
- THE HUMAN SPIRIT. Have you ever watched a time-lapse of leaves opening? The leaf buds at first are small….then they start to grow and swell…..and they continue to expand….but often they hold back as they sense the potential danger of a late frost…..they ache to open….and then the right moment arrives and they BURST open. Their pent-up energy is staggering. The human spirit is not that different when contained and restrained. Especially over an extended period of time. Right now, the human spirit to recover, re-build and get back to work feels EXTRAORDINARY!
So there you have it. That’s my opinion. And it is just an opinion. I also believe different things are certain to happen in different parts of the country and within states, cities and towns as the one thing that will NEVER change in real estate – possibly the ONLY thing – is that it is and always will be an ULTRA-localized industry.
All of us have room for improvement in our presentation styles, whether we are presenting to our colleagues, clients, customers, friends or family. This does not only apply to a speaking engagement in front of 500 people. Here are five PRESENTATION tips from the HARVARD BUSINESS REVIEW (thanks to Maxx Crowley for sending!):
1) Great presenters use fewer slides – and fewer words. Reduce clutter where you can. Edit, edit, edit. Get to the point. Everyone on this planet has limited time.
2) Great presenters don’t use bullet points. The information delivered in pictures and images is more likely to be remembered than words alone. Complement text on slides with photos, videos, and images. Never forget the importance of images and visual aids to message what you have to say….always.
3) Great presenters enhance their vocal delivery. Vary the pace, pitch, and volume of your voice. Don’t underestimate the power of your voice to make a positive impression on your audience. Keep them awake and alert and focused on what you are ‘selling’ to them.
4) Great presenters create “wow” moments. Give your audience something extra. Time it correctly and present it with enthusiasm and passion! Install something memorable, creative, innovative, exciting or interesting even with the most repetitive topic.
5) Great presenters rehearse. Put in the time to make yourself great and practice, practice, practice. This fuels confidence, helps you fine-tune your message and leads to a better presentation.
Never underestimate the power of great communication. It can help you land the exclusive of your dreams, elevate your stature within your organization or simply help you get your ideas and thoughts sold. But while there are plenty of good speakers in the world, using the above tips to sharpen your skills is the first step to setting yourself apart. Stand out by being the person who can deliver something great over and over again.
We thought that these Five Presentation Tips were helpful and would be to our readers/clients as well. Hope they were very helpful!
by Leonard Steinberg
In the first two weeks of 2020 the world has already experienced deadly tornadoes in the South of the US, devastating wildfires in Australia, a high-profile assassination in the Middle East, a volcano eruption in the Philippines, a series of earthquakes in Puerto Rico, a shot down passenger plane in Iran….and its not even two weeks yet…..YIKES! Have we become numb to bad news?
I think it’s very possible that the over-supply of news from multiple media sources, many of which did not exist a decade ago, have highlighted all that can go wrong in our world even more so than ever before. In real time. Sometimes even LIVE. All the things I described above – and worse – have happened multiple times over past decades yet these days they feel like they are happening all the time, every day. Are these times different or have we become so exhausted by the volume of bad news that it all simply becomes a blurr? We have to be reminded that the world is a big place with over 7.5 billion people, 197 square miles of surface area and 195 different countries. That allows for LOTS to go wrong every single day of the year. And with more people comes more opportunity for bad stuff….and good stuff too.
So if we are numb, have we become insensitive and do we lack feeling? No, I think it is human instinct to survive, and part of that requires us to keep moving forward no matter what. Daily life cannot stop. This should come as solace to those who sometimes feel hopeless or even paralyzed by the endless barrage of daily bad news. Are things getting worse? It’s difficult to say no when so much awful stuff keeps happening, yet overall, human evolution has delivered mammoth improvements over time and continues to do so. We will always be subject to cyclical ups and downs and nature, but I find tremendous inspiration from past horrible events: human beings are wired to survive and overcome. Collectively we do have power to fix and prevent certain things, although at times this power is somewhat limited.
It is in these ‘numbing’ times when home and community become even more important, giving us a sense of belonging and security…..a sanctuary of safety, a bubble to escape the realities of life ‘out there’…..or merely a reminder of what is truly important in life. While we may become numb to the volume of bad news that happens – and will continue to happen and has always happened – home stands out as a place that is critically important to the welfare of all 7.5 billion humans on this planet.
So while it may be true that we have become somewhat numb to awful daily world events, I think we are better off viewing this as…. RESILIENCY!