Balancing Member Expectations in a Shifting Market
By Bridget Mccrea
What can you do to help your association keep members happy and stay relevant as the housing market continues to stabilize?
The past five years have been a whirlwind for many association executives. The housing market was pumping, home appreciation was high, and sales were skyrocketing. Buyers were out in full force and membership numbers soared.
Then, in early 2006, the first signs of a shift surfaced. Interest rates crept up, putting more buyers on the fence, which in turn increased for-sale inventories. Before we knew it, a more “balanced” market came into view.
Although most industry experts agree that the current “soft landing” will in no way mirror the downturn of the 1980s, the slowdown has left some association executives wondering what’s ahead. Fortunately, seasoned executives are happy to share why they are confident in themselves and their organizations this time around.
The Five-Year Plan
An industry veteran with 29 years of experience, Judith Lindenau knows what it’s like to take a cyclical shift right on the chin. In the 1980s, her organization lost more than half its membership when the market tanked. “We were broke and had to have a potluck Christmas party,” recalls Lindenau, executive vice president of the Traverse Area Association of Realtors®, Mich.
This time around, membership is holding steady at 800, and the annual holiday party is still in the association’s budget. Lindenau credits her area’s strong second-home and vacation-house market with keeping sales buoyed.
Rather than member attrition, Lindenau is coping with members “venting” to the association about individual performance and general market frustrations.
Lindenau’s association is braced for the current market downturn in large part because of organizational measures put in place after the last downturn. For starters, thanks to alternative income streams, the group depends on dues for only 20 percent of its funding, rather than the previous 50 percent.
“The lesson learned is that we need careful investment policies,” says Lindenau, “such as having in place a reserve policy for our funds, and an investment policy for our excess.”
Additionally, the association has employed a conservative investment policy for years that’s affirmed in a policy manual and “reaffirmed” by the board of directors.
The group also has put safeguards in place so no single leader has the power to alter the association. “We have a five-year plan, a president-elect, and a host of governing strategies that don’t allow our organization to become victimized by someone who wants to come in and turn everything around,” says Lindenau, who learned this lesson the hard way when one director tried to fire the MLS vendor thinking a new MLS system would jump start the slow market.
At the Beverly Hills-Greater Los Angeles Association of Realtors®, CEO Kathy Hartman says membership numbers are creeping up slowly past 6,000. This is especially reassuring given that as a member in the 1980s, Hartman saw her then-association’s membership drop in half virtually overnight. The optimistic Hartman, who has been with her current association for five years, sees a silver lining: more participation from members who have been too busy to volunteer or otherwise get involved with their organizations.
To help members gain an edge in the stabilizing market, Hartman’s association has ramped up its public awareness campaign by including information about “what Realtors® do” on its Web site and by introducing new targeted educational seminars. One such offering was created to help members reach customers who want to purchase “green,” eco-friendly homes, while others focused on the foreclosure market and on handling the different generations of buyers.
At the Realtor® Association of Greater Miami and the Beaches, Teresa King Kinney says 34 years in the real estate business has taught her how to weather the market’s ebbs and flows. Right now, she says, many members are caught between an overabundance of condo listings (due to a condo-building frenzy that took place during the recent boom and resulted in 60,000 new units in downtown Miami alone) and a lack of affordable and workforce housing in the South Florida area.
To make sure membership satisfaction stays high through the slowdown, Kinney says she and her staff get “down in the trenches” to find out what specific issues Realtors® are grappling with out in the market. “We really cant do a good job of providing the best programs, products, and services for them unless we know what they’re dealing with,” explains Kinney, who also chooses to focus on helping spread the word about why Realtors® are more valuable than ever rather than adding fuel to the media fire over reports of a housing market bust.
Recently, for example, the association came up with a reference document listing 200 services agents perform during the real estate transaction. Members can access the list via the association’s Web site, customize it, reprint it, and hand it out to customers. The group also has added a new “open brainstorming session” to its residential, commercial, and corporate board meetings, during which time attendees voice their concerns about the market.
Formed through the merger of three associations in 2005, the MetroTex Association of Realtors® in Dallas was already dealing with the telecom bust when the current market stabilization took hold. Unlike Realtors® in other areas of the country, those 14,000 members already were accustomed to seeing flat or negative month-over-month sales numbers and level prices.
“Our numbers this year will be a smidge above last year, which was fairly close to the prior year,” says Rich Thomas, MetroTex’s CEO. Thomas recently learned from the Texas Real Estate Commission that license application numbers have remained steady. “We’re boldly projecting continued growth at this point.”
But that doesn’t mean the newly formed association is resting on its laurels. To ward off membership reductions and to ensure that all members get the services they need, the group is offering more seminars, courses, and materials on topics such as effective time management, and how to work in the foreclosure and short-sales markets.
The group also is using such tools as a mobile laptop computer lab to train at brokers’ offices around the region. “Getting out in the field helps us touch many more members within a shorter period of time and to tweak our offerings faster to bring them exactly what they need,” says Thomas, who sees such personalized services coming to the forefront for associations over the next few years. “We’re sharpening our deliverables and making sure that the services being presented and delivered are of the highest value possible for members.”
Thinking back to how seriously the 1980s market downturn affected her association at the time, Lindenau says organizations wrestling with similar issues in today’s market would be wise to do as she has done over the years—take a step back, establish a solid governance system, draw up bulletproof policy manuals and bylaws, and diversify income streams to lessen reliance on membership dues. “With these elements in place,” says Lindenau, “members will always feel like they’re dealing with a stable organization that can weather the highs and lows of the market.”
Five ways to help members find balance in today’s shifting market
1. Know their issues. “We really can’t do a good job of providing the best programs, products, and services for them unless we know what they’re dealing with,” says Teresa King Kinney, CEO, Realtor® Association
of Greater Miami and the Beaches.
2. Let them vent. Set up “market update” networking and brainstorming sessions where members can get together to talk about the market
and let off a little steam.
3. Provide targeted education. “During this downturn, we’re offering more seminars, courses, and materials on topics such as effective time
management, and how to work in the foreclosure and short-sales markets,” says Rich Thomas, CEO of the MetroTex Association of Realtors®.
4. Help them sharpen technology skills. Now is the time for members
to get caught up on technology programs and practices they put
off learning during the rush. Offer classes on online prospecting, writing effective e-mails, and building a better Web sites.
5. Promote members to the public. To help members gain an edge in the stabilizing market, Kathy Hartman, CEO of the Beverly Hills-Greater Los Angeles Association of Realtors® has ramped up her organization’s public awareness campaign by including information about “what Realtors® do” on its Web site.