Gary Keller on winning in a market that’s ‘as bad as it gets’
The Keller Williams co-founder told a crowd of the faithful that he sees a soft landing for the economy and success for agents who are "ready to jump" in 2025.
Key points:
- During the annual KW Mega Agent Camp, Keller talked about three different paths the economy could take leading into 2025.
- The most likely scenario, Keller said, is a boost in home sales as 30-year mortgage rates trend down to around 6%.
- Keller also sees the upcoming NAR policy changes as an opportunity for agents who are able to stay focused on what matters.
AUSTIN, TEXAS — While acknowledging that agents are experiencing a market that's "as bad as it gets," Keller Williams co-founder Gary Keller struck a more optimistic tone about what's ahead for the industry.
Speaking at the Keller Williams 2024 Mega Agent Camp on Tuesday, Keller described what he believes are three paths the economy will take heading into 2025.
The path he sees as most likely is what the Federal Reserve is hoping for — providing a soft landing and avoiding a recession. If that happens, he and his team predict an unemployment rate of lower than 5%, 30-year mortgage rates in the 6% range and about 4.5 million homes sold in 2025.
That would be the kind of improvement agents are hoping for after seeing home sales drop to 4.1 million in 2023 and end up in the 3.8 million to 4.2 million range in 2024.
The other two paths that Keller thinks are possible but less likely: a "normal" recession that could boost home sales even as the economy slows, or a banking crisis type of recession that would lead to fewer home sales because banks would tighten lending standings.
"We're at a fairly interesting inflection point in the industry," Keller told the agents at the event, which had more than 4,700 in attendance. "Which means that if you've been doing the work, you're ready to jump."
Dealing with upcoming NAR changes
The crowd appeared somewhat subdued during Keller's market report, perhaps mirroring the mood of the industry right now. Not only are agents dealing with elevated mortgage rates, home prices that are out of reach for many and weak demand, but there is also the uncertainty of how this week's policy changes from the National Association of Realtors will impact their bottom line.
Those changes include making sure a buyer's agent agreement is signed at the beginning of a relationship with a buyer and removing the offer of compensation field from multiple listing service websites.
Keller urged the agents in attendance to not get caught up in scare tactics currently buffeting in the industry, noting that the U.S. Department of Justice is focused on providing transparency for consumers.
"It's still a free market. You're going to be paid," Keller said.
The focus of the rest of the camp is adapting to the changes, whether it's policy changes or the economy. That includes maintaining a toughness — Keller called it being "anti-fragile" in a previous presentation — to endure this period.
"Winning the morning" appears to be the other main thread at this event, with Keller characterizing the work as a series of sprints to reach a goal. As with sports, success can be a long game, Keller said, broken up into plays and quarters that add up to the result. Breaks are needed before you go into the next sprint.
"Once you understand that, you realize that the way you win in life is to break this long journey into whatever strength you want and win the sprint," Keller said.