2 min read October 2022— JBGoodwin REALTORS was founded in 1972 and has several offices in the Austin area and -four in the San Antonio area. Invest: spoke with Erin Cestero, president of the company’s San Antonio Division, about the company’s role in the San Antonio market, the outlook for the industry and the challenge that rising prices poses to the company and its clients.
What are some of the recent highlights or milestones for JB Goodwin?
We celebrated our 50th anniversary this year and we are the oldest independent brokerage in South Texas. We celebrated our 11th year as a top workplace in the city of San Antonio. We also hit record-high sales for our team. In the last year, we expanded our agent partner numbers from 320 agents to over 400 agents and moved into a larger, more innovative office. We are growing very quickly in the San Antonio market.
What is your assessment of the real estate market in San Antonio?
We have a strong and growing economy in San Antonio. Impressive job growth and the large military community contribute to that. Right now, consumers fear the increase in interest rates. We have an opportunity to educate people on how San Antonio’s community and economy differs from other similar areas making real estate a more predictable investment than it is in many places. San Antonio has weathered past recessions very well, which bodes well for the region in the current circumstances.
What should clients be worried about considering inflation and rising interest rates?
People need to think about long-term wealth. The best way to build long-term wealth is still through homeownership. Ownership, even at higher interest rates, still means that you are paying yourself. Real estate remains the key to long-term wealth and savings. That is not going to change with an increase in interest rates.
How have you helped your REALTORS® to adapt to the ever-changing technology landscape?
That has been key for us. We know that everyone had to make that adjustment. We support the real estate needs of people relocating from all over the country and support veterans deployed overseas. We had to have the technology in place to support those individuals before covid forced many to go virtual. Therefore, it was not a big adjustment for us for day to day practices. However, it has become increasingly more important that we use all available channels, such as social media, to get the right messages out to our community and our clients.
What are some of the challenges that you see for first-time homebuyers?
The challenge is affordability. The city is growing so quickly that demand is driving up home values. We are seeing that our Gen Xers know the importance of building wealth and are supporting the younger generations, aiding them in getting into homes. We have developed a program called JBGoodwin EasyMove. We focus on creating partnerships with investors and startup companies that are offering unique solutions. One of those solutions provides rent-to-own scenarios. This allows people to move into their dream home even if they are still working on credit or saving for their down payment.
How do you navigate the challenge of price escalation as it relates to construction materials and processes?
We have seen a huge inventory increase in our market. Builders saw the largest cancellations of contracts that they had ever seen in July 2022 due to interest rate increases, driving many new construction homes back on the market. It increased our inventory and actually created a better balance. It is challenging for the builders as they have lost a lot of time and cannot get all of the supplies they need. They are offering many incentives to try to bring those buyers back in the door. They are buying down interest rates in order to overcome the fear that buyers had from the change in mortgage payments every month. I think it has created a scenario that is scaring people. However, this resulted in a better balance and a healthier market situation overall. In the last 18 months, many buyers went through buyer’s fatigue in extreme multiple offer situations. Those buyers who rented six months ago are going to be ready to buy a home now even with higher interest rates. We are working with those people today.
Has that shifted the communities that are hot in San Antonio?
There was a shift due to a focus on amenities after a unique year spending more time at home. There was a focus on green parks and subdivision areas. Builders also started buying unique urban plots of land that people would not have considered before the craze of the last few years. Urban developments are on the rise with access to downtown, The Pearl, and areas offering similar amenities. On the other hand, people are also willing to drive further out of town for peaceful, rural locations. The virtual work market has also allowed people who don’t have to drive in to work daily to live outside the city.
What are the biggest challenges that you are facing?
I think misinformation and fear are the biggest challenges we face. National statistics cannot be applied to our local market. People have short-term memories, especially when you look at interest rates. They don’t remember a time before 3% rates. We are focusing on getting back to the basics. We have to remind people why homeownership is still the most predictable investment in the world. Through 2020 and 2021 we had to get creative with technology and iBuyers, using different solutions to get a seller out of a home and into a new one in a competitive market. Today, after a dizzying few years, we need to remind people why homeownership is important. We need to help people to analyze the renting versus purchasing scenario. We can also help families with long-term goals when it comes to building investments and investing in their home. For us, it is about getting back to basics to help overcome fear.
What is your outlook for the industry overall for the next three to five years?
I think many people will leave the real estate industry due to its inherent demands as a profession. Some people decided to get a real estate license over the COVID period hearing the news of a booming market and thinking it was an easy career with a quick return. What not everyone realizes is, we work long hours and work with people during their most stressful moments of selling or buying a home. It is a demanding career and a demanding industry. For those who work hard at it, though, we are fortunate as we have one of the most rewarding careers as well. We can get really close with families and help them with something that is so important for their future. Experts in the industry believe we are going to see a large decline in the number of agents in the nation. There is plenty of real estate business still in San Antonio despite the decline and people leaving the industry. My message to my team has been to “lean in.” This isn’t the time when we sit to wait and see what happens in the market. We double down. We need to get creative now in educating consumers, providing the right resources so that people can overcome their fears and move forward faster.
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