A letter to my daughter starting her career in new home sales.

May you live in interesting times... right?

My wife and I have been in the residential real estate development/construction/sales and marketing business for over 30 years and have lived through some truly remarkable times. After 3 years with the Ritz Carlton, 1 of our children has decided to follow us into the industry and she is only 60 days into her training program as a Sales Manager with Ashton Woods in Atlanta. Talk about timing, right? She has been a little shy about asking questions about the market and honestly, I have been reluctant to give her a big information dump because she's all 'shiny and new' in terms of her understanding of the business. I don't want to discourage her (or anyone else) as she begins to navigate her new career, she needs to feel her own way through this and if she can do it on her own, she will be immensely more capable in the long run. Parenting 101, right? That being said, yesterday she asked me "Dad, what's going to happen?" Here's what I told her.

Emily,

I know the news is unsettling and even though you're new to the business, you have seen the change in how business is being done. After 30 years of working through significant business challenges in Senior Management positions with public homebuilders, here's what I know:

There is a beginning, middle and end to everything. The scariest part this time is that we are in a completely uncharted situation. Demand is still high, interest rates are historically low and in many markets in the US, the underlying dynamics are still strong. In the sales office, you hold a position of major importance to your builder. The store front has to be open for customers because production is delivering homes and it's your job to find the buyers, they are there in every market I have ever seen. An operational reality in any business is - "Sales drives the bus". Think your job is important? Right now it is probably the most important in your business unit.

Don't worry about the things you can't control.

That doesn't mean you can ignore the world we all live in but tough times present opportunities for professionals that are prepared. Home buying is largely an emotional decision, be calm, present the home in a warm and professional way, connect with the customer. Do your best every day.

The big picture looks like this. The builder's in your market will be weighing out all their options but they will ALL be figuring out how to turn their completed homes/assets into cash while hanging on to their core of talent. As a salesperson, they will be counting on you to perform and depending on how long this goes and how the market responds to the different price ranges of your products, you could expect to see some incentives showing up as a ‘sweetener’ to get deals. Remember, very few people buy a ‘deal’. Always sell the home.

Builder's that have huge lot inventories but limited homes to sell will have the hardest time. One time when I was showing a land deal to some people from the corporate office. Don Tomnitz from DR Horton told me 'the builder graveyard is full of tombstones that say 'Long and wrong'. Some builders will get in trouble, the ones in your market that are well capitalized will find new land opportunities at a great basis. The strong and prepared will grow, the weak will have serious structural challenges inside their organizations. When you hear of this, know the bottom is near.

You have what it takes to make it through this time. Seize opportunity. Engage your natural skills, know your product (and your competition's)and make every conversation and everyday count. Work hard to become an asset. When this is over (and it will be), household formation, low interest rates, great product and strong confidence in the economy will bring a solid trail of people back to your sales center.

Proud of you.

Dad