The first quarter results for San Juan Island were very similar to the first quarter results last year. San Juan Island’s dollar volume for the quarter reflected a decrease of 12.5% as compared to the same quarter in 2018. The first quarters are often a roller coaster for our islands and are affected by weather, local and national events. The number of transactions was down 31%.
The County’s first quarter dollar volume reflected a decrease of 25% as compared to 2018 and the transaction numbers also reflected a decrease of 33%. The inventory level in some categories is having an impact.
The volume analysis clearly reports San Juan’s volume as lack luster and off to a slow start. The first quarter of every year is volatile and for San Juan, this year is no different.
As of April 2nd, the total inventory on San Juan Island is 175 for all types of properties, excluding business opportunities. An additional 24 are pending and in escrow or 14%, this is in contrast to years past. During the recession, up to and including 2013, the percentage of pending was much lower and in the 7-9% range. Since 2015, the percentage of pending transactions during this month every year trended upward until 2019. The percentage for San Juan Island decreased to 14% from 23% or 40% from April 2018. Which all makes since, less escrows equates to less dollar volume and transaction numbers.
As you may be aware, the escrow term is typically 45 days so our dollar volume for the first quarter is originated with contracts starting in November and December of the previous year. I do recall having some spare time last November. As I mentioned above, the first quarter is always volatile and doesn’t equate to a trend.
As reported in the year-ending 2018 newsletter, the volume was flat during 2018 with San Juan County at a 1.5% gain and a slight decrease of 14.5% for San Juan Island. A quarter is too short to analyze and predict any trends so time to move on and discuss other topics. I would love to discuss how much the real estate industry is changing. I have been on the island practicing my trade for 24 years and can laugh about how we went to Radio Shack to have our prints developed so we could paste them on a brochure and make photocopies at Printonyx.
With the technology advancements our trade has become very complex and competitive. With the advent of the Zillow, Trulia, REALTOR.com and other similar platforms, our business change daily. Basically, a platform such as Zillow, uses our listing data and sells it back to us in exchange for leads. It is a brilliant business model and is leading our industry with innovation. I, as many of the agents on the island, pay Zillow and other platforms monthly for leads. There is no way to beat them so one must join them. The downside of this program is the duplication that is caused. In the old days when a buyer would call or walk into our office, we would ask, are you already working with another agent?
If they were, then the agent would respect the other agent’s relationship. With Zillow, numerous agents end up working with the same client. It works well for the client as they get their questions answered in a timely manner. It is very confusing for the agents and we end up overlapping our business with other agents.
Now the clients are sent to you 24-7 via a text. Then you respond via an app on your phone, if you don’t respond due to other appointments or off hours, you are downgraded on the list based on your percentage of response. Actually, being disciplined for being non-responsive, what a concept!!!!
All this accountability is a good thing for our industry. If agents want to work part time and only work with a few clients a year, they can still do that. They don’t have to join the various platforms. If they decide to step up and join the platforms, they are held accountable for their customer service at a level far beyond what was expected in the past for the industry.
For the experienced agents, most of our business is derived from repeat clients and client referrals and in my case, my next highest sources are the articles I write, the newsletters and even my lifestyle videos. Having said that, I am the highest paying Zillow agent for 98250 because I cover all my basis. My business model has changed accordingly, in order to compete and stay near the top of the production list on the island, I have had to do a lot more than just list and sell properties. Community service and involvement is mandatory. Understanding and practicing the Code of Ethics, rules and laws from the department of licensing and internal broker procedures and policies have become a large part of our practice. More importantly, is understanding our local County land use regulations. We are professionals and must be able to provide information and direction to our clients to aid in their buying decision. Regardless of where the client lead is originated from, they all require a high level of customer service and a knowledgeable agent with experience in the industry. Even though we have all the new “bells and whistles”, real estate is still a people industry and it comes down to relationships. Real estate is local and boots on the ground are critical. As always if you need additional information, please be sure to contact me. To read all my past market updates and industry related articles or view my San Juan Island Lifestyle videos, please visit my blog at: http://sanjuanislandslifestyle.com/blog/