Company. William Raveis Real Estate Industry. Residential real estate Key. Technology will be a key to success in residential real estate.
William Raveis started his residential real estate company in a small one-room office above a grocery store in Fairfield, Conn.
With a $2,000 bank loan in 1974, he parlayed his namesake firm into one of the largest residential real estate brokerage firms in the country. Industry tracker Real Trends ranked the firm eighth in the nation last year in transaction volume with $8.1 billion in 2014. The closest Florida-based competitor was Naples-based Premier Sotheby's International Realty with $3.4 billion.
Now, William Raveis Real Estate is targeting Florida with plans to open 30 offices in the next 10 years. First stop: Naples. “Competition is showing up, that's what's happening,” Raveis says.
Like many successful CEOs and entrepreneurs, William Raveis owns a home in the tony enclave of Port Royal in Naples. “My wife and I have been in Naples for the last 12 years,” he says. “I love the community and I've seen it grow. I've been going to open houses.”
But Raveis says he's noticed a pickup in the number of people moving from the Northeast to Southwest Florida. The exodus has increased in recent years as wealthy baby boomers seek to escape onerous tax burdens in states such as Connecticut. Raveis' conclusion was he was missing out on the transactions: “We should be here,” he says.
The first office is located on Fifth Avenue South, the main high-profile street of Naples. “We're starting in Naples because I'm there,” Raveis says.
But this won't be a lonely Florida outpost for the Connecticut Realtor. Indeed, Raveis says Collier County is comparable in market size to Fairfield County in Connecticut, where the firm has 14 offices.
“We're not just going to have one office,” Raveis says. “We'll go to Marco and other places.”
Meet the Lanes
Raveis turned to Matt and Molly Lane to open and manage the Naples office. The two are former advertising executives from New York City who specialized in the health care industry. For example, Molly Lane directed the advertising effort for drug giant Pfizer's introduction of Viagra.
But juggling two high-powered New York City advertising jobs with commutes from Connecticut was especially demanding with two young children, so Molly joined Raveis in Westport, Conn., in 2010 and Matt joined her three years ago. Marketing real estate wasn't much of a stretch because Raveis brought the same level of sophistication to his operation, they say. “It reminded me of selling pharmaceuticals,” Molly Lane says.
The Lanes, who are now empty nesters, have been visiting Florida for the last two decades and were eager to help Raveis expand to the Sunshine State. “Everyone's moving to Florida,” Matt Lane says, noting industrial giant General Electric is planning to move its headquarters out of Connecticut to an as-yet-undisclosed location.
“We know the luxury market really well,” says Matt Lane, who estimates that as many as 20% of the luxury homebuyers in the wealthy Connecticut enclaves near New York City also have a home in the Naples area. “We're following that relationship to Southwest Florida,” he says.
Technology to real estate
Early in his career, Raveis became a systems analyst for Westinghouse International, and by 1972 he was responsible for the company's worldwide computer systems.
So when he opened his first residential real estate office in 1974, Raveis says he envisioned helping agents create their own teams and brands using the latest technology.
Raveis says his success is due in large part because of the relationship he has with agents, which puts them first before anyone else. “The agent is our customer,” he explains.
For example, the company has a call center that responds to agents' customers within 15 seconds, faster than any agent might. “You just can't let a sales associate rely on getting back and forth with people on the Internet,” he says.
Technology is a big part of the operation. “We have 26 people in IT and marketing,” Raveis says. The company is using the latest technology including video drones and geofencing, a virtual boundary that allows an agent to deliver a message on your smart phone about a home for sale when pass nearby.
Raveis has partnered with statisticians at the Massachusetts Institute of Technology to provide home sellers and buyers with accurate forecasts of property prices. “We have vetted that out for the last 20 years,” Raveis says.
Already, Raveis says the firm has 30,000 prospective sales leads going into Naples. “This is going to be one of the easier entries for us,” he forecasts.
Realtors have been enquiring about the new office, showing up as early as December even though it won't be open until later this month. “Cool your heels, folks,” Raveis chuckles. “The office is just being built out.”
Where's the inventory?
Listings of homes for sale are the lifeblood of the residential real estate business, but the inventory shortage in the Naples area is some of the most acute in the region.
Well-established and newly arriving firms say they're not overly concerned about the decline in inventory of homes for sale in recent years, despite the widespread complaints by agents seeking listings. In some of the hottest areas of Naples, there are just one or two months of supply of existing homes for sale.
But there may be some relief on that front. The latest tally in November by the Naples Area Board of Realtors indicates substantial increases in the number of homes for sale in several price categories for the first time since the recovery. For example, listings of single-family homes in the $500,000-to-$1 million category rose 16% year over year. In the $2 million-plus category, inventory climbed 19%.
“From my company's perspective, our inventory number hasn't been changing much,” says Mike Hughes, vice president and general manager of Downing-Frye Realty. “The properties are coming on the market almost as fast as we're selling them.”
Some of the jump in home listings is seasonal in nature because sellers are anticipating a busy winter season. “We expect and want inventory to go up in the fourth quarter,” Hughes says.
In addition, prices have been rising at a double-digit annual percentage clip in recent years, prompting some to consider cashing in. “People have been holding back and waiting for the right time,” says Dottie Babcock, chief operating officer at John R. Wood Properties.
Plus, homebuilders have been busy delivering more new homes as the recovery continues apace, data that's not reflected in the monthly sales of existing homes by the association.
For example, in December, Collier County reported a 69% increase in permits for single-family homes. “The building industry has plenty of inventory,” says Rick Fioretti, president of the Naples Area Board of Realtors and an associate broker at Berkshire Hathaway HomeServices Florida Realty.
“Everybody always crows about inventory not being there, but that's not the issue,” says William Raveis, whose Connecticut-based firm plans 30 offices in Florida starting with Naples.
Raveis says the best-managed firms will get the larger share of inventory of homes for sale. “Who has the better offering?” he says.