Observations in a growing housing market

//August 17, 2016

Observations in a growing housing market

//August 17, 2016

It’s been this way for the last few years. We’re back to the pre-recession levels in many areas if you look at the numbers.

Here’s a few recent numbers from the Harrisburg area.

With that said, I’ve been expecting to see more brokers enter the market to take advantage of the upswing. There are more agents.  

Every year there are one or two new firms that start up and try to make a name for themselves. But there hasn’t been a major rush, at least not yet.

Maybe that’s coming, maybe not.

Trying something new is always a risk, but then again entrepreneurs are always out there in good times and bad.

We explore the issue of independent brokers and franchise companies in this week’s print edition.

More common in this market seems to be growth in the number of real estate teams and groups of agents moving from one firm to another. The big franchise firms continue to grow to retain top market share, while the medium-size companies are looking for ways to add talent to take a bigger piece.

Maybe that growth will come through acquisitions of smaller brokers when the market starts to level off or as newer names become more attractive targets during the market rise. 

There hasn’t been as much movement on deals since late 2014 when NRT LLC, the nation’s largest broker, acquired Manheim Township-based Realty Select Inc., which did business as Coldwell Banker Select Professionals, and merged the Coldwell Banker affiliate with company-owned Jack Gaughen Realtor ERA.

The result was Coldwell Banker Residential Brokerage in Central Pennsylvania.It was a merger of the region’s No. 2 and No. 3 residential brokers.

Pittsburgh-based Howard Hanna Real Estate Services has become the third-largest real estate firm in the country since then, but that growth has come via deals it has made in surrounding states. Howard Hanna opened an office in Lancaster County last year.

What will be the next big move? That’s hard to say. The big names, including Berkshire Hathaway HomeServices Homesale Realty, are always in talks to expand their reach. 

But there are plenty of potential targets who are going to say “no” to deals, especially in a rising market where they can pick up a little more business on their own. Or there could be a few owners, either those near the end of a franchise agreement or retirement age, who take the deal because the offers might not get any better.