Archive for year: 2021

Erin Davis: Welcome to REAL TIME. I’m Erin Davis. Whether it’s our salaries or our family dinners, negotiating is part of our daily lives. For REALTORS®, it’s fundamental to your business. On episode 22 of REAL TIME brought to you by the Canadian Real Estate Association, we’re joined by one of Canada’s most influential business leaders, the dynamic and very entertaining Wes Hall who brings us some practical knowledge.

With Mr. Hall, the newest member of CBC’s Dragons’ Den team, we’ll explore principles, best practices, and trends in negotiation, as well as key takeaways to help you as a REALTOR® to strengthen that skill. Look at you with the still new dragon glow to you. [chuckles] You said on a promo for CBC that everybody was going to love you and all the dragons were going to love you. How has that worked out so far, Wes?

Wes Hall: They still love me.

Erin: Oh, good.

Wes: That’s what happens when you’re a lovable person. Everybody is going to love you, right?

Erin: Oh, okay. All right. I’ll keep that in mind for our conversation here. It’s great to have you with us. Your story is unbelievable. You did, as you know, grow up living in a tin shack in Jamaica, and now here you are one of North America’s most influential power brokers, a hugely successful entrepreneur, an anti-racism activist, and of course, as we mentioned, the newest dragon in the den. Tell us if you can, Wes, here, and it will make a best-seller one day if it hasn’t already, your journey from such humble beginnings to where you are today. Would you, please?

Wes: It is indeed a journey. When people hear about this tin shack, they probably roll their eyes and go, “Of course, everybody is from a tin shack.” I literally was from that tin shack. It’s got the zinc roof. If you look it up on the internet Wes Hall’s tin shack, you probably will see it. Me and my grandmother in a picture standing looking at the shack and me saying to my grandmother at the time, “I’m going to get you out of this place one day.”

I have 14 brothers and sisters, by the way, a traditional Jamaican family where I have zero full brothers and sisters in that number. My mom and dad was never married. They had a one-off and I was that one-off. That’s why I’m so special because you just can’t replicate Wes Hall.

[laughter]

Erin: I wish you’d work on your self-confidence a bit.

Wes: I’ve tried. It’s just so hard.

[laughter]

Wes: It’s hard to be humble but I try.

Erin: You came to Canada in your teens.

Wes: September 27th, 1985, Friday. I came to live with my dad and I moved to Malvern. That’s where my dad was living at the time and he had five kids in Canada on his own. I came in to live as number six in that household. He had another daughter that was in Jamaica that came later on, but I was out of the house by that time. I was added to that household and it was the most amazing thing for me because it was my first time on an airplane, my first-time seeing traffic lights because I lived in literally the bush in Jamaica.

When I came here, I got off the airplane at Toronto International Airport, Pearson. I walked outside and I saw these people, my siblings, and my stepmom, and my dad waiting for me. Oh, man, it was just a euphoric moment. Then I got into their vehicle and I’m driving on a six-lane highway, the 401. I’ve never seen anything like it before. Then we landed at his house in Scarborough that the whole neighborhood was still under construction. It was mud and dirt but to me, that was paradise. I found paradise coming to Canada.

I kept that picture of me and my grandmother in that tin shack on my desk on Bay Street for two reasons. One is to remind me of where I came from and never to forget, and two, to celebrate this great country of ours. It’s only in a place like Canada – I hear about the American dream and so on. You never hear about the Canadian dream, but the Canadian dream is alive and well. For me having that picture, it’s really celebrating the Canadian dream, that you can come from a tin shack and you can end up at the top of corporate Canada on Bay Street.

Erin: It is an amazing story. The Canadian dream, as you say, we don’t tout it enough. It’s our nature to downplay stuff like that. Your grandmother who raised you and your brothers and sisters, what kind of an impact or influence did she have on the man that you are today?

Wes: Everything, every aspect of who I am today was architected by her. When you think about it, she didn’t sit me down and gave me lessons and say, “Here is how you become a man, Wes.” She used her example of industriousness to show me what I should be when I grow up. See, I was abandoned. My oldest sister, she was two years older than me, my younger brother who was a year younger than me, and I was 18 months at a time and we were left in a house by ourselves by our mother. A neighbor heard us crying and went to the plantation. My grandmother worked at a plantation. She worked in a plantation, banana plantation, a coconut plantation depending on the season.

The house that we were raised in was provided by the plantation owners for the workers to raise their family, so my grandmother had this two-room tin shack that she was given. She came and got us from the plantation and brought us to live with her. I was 18 months old and she wasn’t argumentative about it or was bitter about it. She was 60. Could you imagine at 60 years old, you have all these grandkids that you’re raising already and then you inherited three more and the three was all under five years old? You would have some resentment towards your children or your kid that did to you or towards your grandkids.

My grandmother, I never ever remembered her holding it against me as a child. She was working extremely hard to make sure that there’s food on the table for us, to make sure that we went to school. We didn’t have much. I didn’t wear shoes to go to school because we couldn’t afford it. There are times when I didn’t even have food to bring to school to have lunch. The fact of the matter is that she knew that education was important, and she made sure that we went to school. I grew up watching her, and as a result of watching her, it was instilled in me what I should be when I grow up and I wanted to be like her.

Erin: She taught you the art of negotiation, I understand too. As anyone who has been to a Jamaican market, as a tourist, I always go in there and I go. “Oh, I hate to haggle. I hate that bartering back and forth.” If you don’t know how to do that, you don’t belong there.

Wes: Listen, when you are poor, you have no choice. Just put it that way. If you think about my grandmother raising all these grandkids, and she has a finite amount of money to spend. If you think about what it’s like to work on a sugar cane plantation, you’re in the hot Jamaican sun, you’re bent over with a machete in your right hand and grabbing the stalks or sugarcane with your left hand and you’re chopping at the root. Then you chop the stalk at the top and then you put them in piles, and you do that for 10 hours a day. The only time you stop is to drink some water, wipe the sweat off your brow and have a little bit of a snack or something to eat quickly and you go back at it again.

When you get that paycheck, once a month they pay you, you have to stretch that money as far as you possibly can. When you go to the market to shop, you have to make sure that if they’re saying that tomatoes are $2 a pound, you try to make sure that you get that tomato for $0.50 a pound. That’s what I saw in my grandmother when she would take me to the market with her that not a single price that she was quoted she end up paying for that product. She always negotiated and she always got the price she wanted.

Erin: She was also someone who was selling her wares as well, so you sold from the other side.

Wes: Exactly. I saw the buying part and the selling part. When you’re buying, you want to get it as cheap as possible. When you’re selling, you want to get the most money as possible. One of the things that my grandmother would do is because she would sell puddings, for example, she would bake these amazing puddings and she would sell them. Her puddings were so good that she would be selling it for more than everybody else in the market. She’ll be sold out before everybody else. That would create this amazing word around the neighborhood that if you want to get the best pudding at the market, you have to go early because Mama Julia’s pudding is always sold out early.

When you’re creating that kind of demand for your product, it doesn’t matter what the competition is doing because you’re always going to get your price. Especially when you’re going to be sold out before everybody else, you can keep on marketing that up. That’s what my grandmother would do, that her pudding was the most expensive pudding in the market and it’s always the one to go first.

Erin: Before we leave Jamaica and head to Bay Street, which is where we’re speaking to you today, what became of your grandmother? Were you able to share some of your bounty with her before she left us?

Wes: You know what, thank you for that question because I never really got asked that question in the past and I really appreciate it. In that tin shack picture that you would see if you search on the internet, I was 22 years old and my grandmother was a very old woman at the time. I went back and I said to her, “Mama, I’m going to get you out of this tin shack one day. I’m going to work hard enough in Canada. I will continue to work hard to get you out to that tin shack.” I got my first big break on Bay Street, the first one I became a vice president on Bay Street, I’m like, “Finally, I’m ready to get my grandmother out to that tin shack,” and she died two weeks later.

She never saw the ultimate success. See, I had three children. I was working hard. I was trying to provide for my family, and I was waiting for the perfect opportunity, the perfect timing to bring her over to show her my success. As a result of waiting for the perfect opportunity, she never saw any of it. I shouldn’t have waited. I should have brought her in here a lot sooner so that she can see what I saw when I came here at 16-years old, September 27th, 1985, because that impressed me, just being in this country impressed me. I know she would be impressed by this country and by what I was doing to work hard and to try to provide for myself and my family here.

She never saw it. She died in that tin shack. That’s one of the reasons why, Erin, I push myself as hard as I do because she deserved to be where I’m at, she deserved to appreciate the fruits of my labor because she was a big part of that and she never got it. I don’t really work for money anymore. Yes, I initially started by saying I want to make as much money as I possibly can, but now I try to change people’s lives by the wealth I’ve created for myself by working hard. If I can change people’s lives like my grandmother changed my life, this world will be so much a better place.

Erin: That is so beautiful. Thank you and I am so sorry. I’m so sorry for that regret for you, Wes.

Erin: Coming up, how Wes Hall just about let his biggest break slip away because he had to. It’s a great story. Love REAL TIME? Thanks for finding and supporting us. Subscribe to our channels on Spotify, Apple, and Stitcher to stay up to date on future guests and stories, or visit CREA.ca/podcast for more details and to catch up on past episodes. They are all worth your time.

You referred to that job, that vice presidency that you got on Bay Street. Your first really big break, but you almost talked your way out to that one. I just love the lesson in here. Be prepared to lose, Don’t pick a fight with someone who’s got nothing to lose. Tell us that story, Wes, if you would, please.

Wes: I was living in a 1100 square foot house with my wife. We couldn’t afford to pay the mortgage. We had three kids under three years old and I had this job offer to be director of business development for a US company and I was going to be business development director in Canada. I had this mindset that my next big break has to be a vice president position. I won’t accept anything less than that. This gentleman, the CEO of the company, offered me this opportunity to be director of business development and he told me what the salary was and so on.

I remember when he gave me the call, I was in the master bedroom with my wife. We didn’t really have enough money to afford a bed, so the box spring and the mattress was on the floor and that’s where we’re sleeping. I took this call and the gentleman says, “I have exciting news for you, Wes. After the job interview and everything, I’m offering it a position of direct to business development.” I said to the gentleman, “I really appreciate the offer, however, I would like to be a vice president.” He said to me, “I don’t have the authority to offer you a vice president position but director of business development is yours”. I said to him, “When you have the authority to offer me that job, give me a call”.

Erin: Oh.

Wes: He said, “Okay.” [chuckling] He hang up the phone, and that was it. My poor wife was laying on the mattress on the floor. She could not believe what just happened because we didn’t even have enough money to buy diapers for all the kids and I’m turning down this job not because of the money, but because of the title. She couldn’t believe it, but guess what happened. Two weeks later, I got a call from that gentleman and said, “I have the authority to give you what you want,” and I became a vice president on Bay Street.

Erin: Oh. Those were some tense two weeks with your wife, though, I’m going to guess.

Wes: [chuckles] We’ve been married for 30 years now and I can tell you if I didn’t get a job, it probably wouldn’t have made it to 30.

[laughter]

Erin: Wes, why is it so hard for us to negotiate fair compensation?

Wes: I think we’re afraid of losing out. When you think about it, that’s your value. That’s what’s going to create wealth for yourself and your family. That compensation is going to allow you to take nice vacations, live in a nice home, be able to do things for others philanthropically, and so on, but yet we find it very difficult to tell people this is how much I’m worth, this is what my value is to you. We go into companies and we create massive values for companies.

When I was working at this vice president level at this company, I was creating a ton of value. I was underpaid and I went into my boss’s office and I said, “Listen, I’m underpaid because here’s the value that I’m creating for you, and here’s where my compensation is. They don’t align with each other.” They fundamentally disagreed with me on it and I left to start Kingsdale. If they didn’t disagree with me, I would be still working for somebody else and I wouldn’t have started my own company, Kingsdale.

As a result of starting this company, I became one of the most successful person in the industry and become the person that I am on Bay Street today because I wasn’t getting fair compensation to begin with. I tried to do something about it, and when they refused to do something about it, I decided to go on my own and bet on myself. That’s the problem, a lot of people aren’t prepared to bet on themselves. When you think about it, would you prefer to invest in somebody else or would you prefer to invest in yourself because you know what you can do, you know what your limitations are, you know what your capabilities are as well?

Why not bet on yourself especially when you want to be an entrepreneur, but you go, “Man, I just don’t know if I can do it.” You need to get those doubts out of your mind, at least give it a shot. That’s why I decided to do, when I started this firm, I said, “I don’t want to be sitting here 20 years later regretting the opportunity that I’ve missed. I want to know that I’ve tried it, it didn’t work and I can pivot and figure something else out.”

Erin: Boy, have you ever made it work out for you? Let’s talk a little bit about high-stakes negotiation. How do you go about reading the room?

Wes: Every single negotiation we go into, we have to figure out who’s on the other side of that negotiation. Some people are prepared to pay more than others, some people are just not. When you are in a business where there’s no particular price list, for example, if you look in the real estate business and there’s typically if you go down a particular street in a particular neighborhood, every single house is not exactly priced the same.

There’s room there, wiggle room for your creativity, and for you to now determine to the market why your house should be more valued than the other houses in the neighborhood, and in sometimes, 20%, 30% higher. There may be features that you put into your house that others didn’t put into there. How do you value that? In terms of negotiating, you have to figure out how important are these things to the person buying my house?

Erin: How does a REALTOR® go about finding out what’s important? Just listen or what hints would you give, Wes?

Wes: I would say the questions that you ask. When you’re going through a showing, for example, you have to appreciate what are the things that are getting the person’s attention that you’re touring through the house. Sometimes, for example, we’re going through and we are just excited about, “Oh, I can’t wait to show them this part of the house,” but yet that person is still in the kitchen looking around the kitchen, but we want them to hurry up so they can show them the important part of the house. Guess what?

The reason why they’re in the kitchen, maybe he’s a chef and he loves to cook. He’s picturing himself in the kitchen cooking a beautiful meal and you’re trying to interrupt that by showing him the gym when he doesn’t care about the gym because the gym is so beautiful or the theater is so beautiful, but he doesn’t watch TV or he doesn’t watch movies, or he doesn’t really care about those things. We need to read the audience and to see what’s appealing to them and then focus on those moments.

One of the things that somebody said that I heard great about selling the house is that sometimes after you finish the showing, just sit in the living room or some great part of the house with the person and have a conversation with them because then they can visualize themselves living in that house, sitting in that room, maybe reading a book, maybe the fireplace is on and it’s snowing outside. All of a sudden, it changes their view on the place because they see themselves in it. Sometimes we miss those little part of getting things done. If we focus on those things and pay attention, we can close deals really quickly and we can actually get the prices that we are looking for.

Erin: So much of this is listening, isn’t it?

Wes: It is. One of the things that I tell my team when we’re negotiating, for example, and sometimes in real estate, you’re on the phone negotiating with the other side and you give them all the this is why this house is so great and everything, the feature sheets is all there and everything. Then you tell them, “Okay, but this is my price, $10 million.” Let’s say, for argument’s sake, we’re in the big leagues here, $10 million. This person on the other end, you convince them that this is the best house for them and you know you convinced them is the best house. Then when you put the $10 million on the table, again, you try to justify it still.

Why? You’ve already convinced them that this is a house for them. Now you have to convince them that $10 million is a price that they need to pay in order for them to own it. Let them determine why it’s not worth $10 million. Sometimes we try to sell against ourselves. We tend to just oversell when we already have this person closed. Then we try to justify the price tag that we put on there.

We shouldn’t justify. If we list the house for $10 million, once you start to you put your feature sheet out and you start to bring people through it, $10 million is $10 million. You bring me an offer for $10 million, nothing less. You bring me something less, I’m going to have a conversation with my seller about it, but at the end of the day, this price is the price that you’re going to pay ultimately. You’re not going to get me to say it’s eight or seven because other come say this is unique, and these are the reasons why it’s unique. When you find that buyer that know that this place is unique, you got to close them.

Erin: Sometimes it’s listening to the seller too, the seller who maybe doesn’t want this house torn down for a replacement. That they want to be able to come by and see it again with their grandchildren one day and say, “This is your parents were born,” or something like that. There can be things to listen to in the seller’s story too. Can’t there?

Wes: Absolutely. I sold my first house for $200,000. Bought it for $112,000 and I sold it for $200,000. It’s over 30 years and every year, I go back to look at that house because I remembered when I was standing in the bedroom, when I got that job offer and I turned it down, I remember that I fixed that porch at the front. The porch was done by me, my hands. 

I take pictures of that house it’s important to me that I do that. Then I bring my kids by to say, “This is the way you were born.” If I now, let’s say, when I was selling that house and I had that emotional attachment to that place, and somebody said, “I’m going to rip it down and I’m going to this amazing building there and the house is going to be fantastic,” fine, that’s your dream, but you just took away something that’s really important to me because you’re going to demolish it.

As a result of that, I prefer to sell it to someone for less money who’s going to preserve it than somebody who’s going to destroy that memory. Sometimes if we don’t appreciate the seller’s motivation for selling, we could be leaving a lot of value on the table and we completely could be losing opportunities because we just didn’t listen to the reasons behind why this person is selling this house.

Erin: When we return to REAL TIME, our guest, Wes Hall, one of Canada’s top rank business negotiators looks at the things that hold us back, the barriers when it comes to negotiation. If you’re like me, you find the best coffee or tea is the one you’re enjoying at home, maybe right now, but the best content is at the CREA Cafe. Tap into the knowledge of REALTORS® across this country of ours. Share your own lessons and insights by visiting REALTORS® Corner on CREA Cafe, a hub of great content created by REALTORS® for REALTORS®.

When we’re talking about negotiation, as you’ve pointed out so perfectly, it can come with a great range of emotions, especially in an industry like real estate where clients aren’t just buying and selling houses, they’re buying and selling homes. They’re buying and selling the place where your children came into the world and where you took that phone call and said, “No, I’m going to wait for VP.” Wes, what are common emotional barriers to negotiation? You’ve said there’s a thin line between arrogance and confidence. What are some of the most common emotional barriers?

Wes: I think sometimes it’s really not really understanding people’s motivation. When you think about the real estate transaction is one of the most important transaction that you’ll ever do in the business world. I buy and sell companies and so on, but that’s only a very small number of individuals that are in that category. Most people that own a home, at some point, they’re going to transact. At some point in their life, they’re going to sell that home, and then they have to make that decision very, very quickly. The longer you stay in that home, and the more improvements that you make to it, the more difficult it is to part with it.

You’re parting with your neighbors that you’ve built great relationship with over the years, you’re going to the unknown in the future. If you don’t understand the emotional attachment that people may have to that piece of asset that they’ve cherished for so long, that have built their value – My company, for example, that $112,000 home that I bought, for example, allowed me to a bigger home that allowed me to put a leverage on it to start my company, Kingsdale. That home created a value that I have and the wealth that I have today. It was an emotional attachment because it’s my future.

If you don’t appreciate it, that it’s my future, and don’t really treat it like that, then all of a sudden I don’t want to do business with you because doing any type of business, especially in that space, it’s about trust. I have to have trust and confidence in you that we’re going to have a good working relationship, you’re going to respect what I bring to the table, and I’m going to respect what you bring to the table.

When you give me the advice to say, “Wes, you should take this undervalued number or this price,” that I trust that you’re coming from the right place and that you just don’t want to turn me over because you have so many deals on the table and you have so many other clients, I have to be so special to you that I believe that I’m the only client that you have even though you may have hundreds. You have to give me the impression that I’m so important to you, that there’s nobody else that you’re paying attention to. My business, Kingsdale, when you think about what we do, we advise companies that are doing hostile takeovers and shareholder activism.

When I’m advising a CEO that’s under threat, somebody is saying that we’re going to replace you because you’re not competent. Then I’m talking to that CEO and I’m saying, “Wait a minute here, I’ll call you back because I have somebody else on the phone to talk to,” how do you think that person feels? In their mind, they’re the most important person on your list and you’re telling them that no, let me call you back because I have other things to do. We should make sure that we spend as much time.

If we look at it to say, “You’re not paying me as much as somebody else,” guess what? That person in the future could be paying you so much more because you’ve cultivated that relationship. Again, I spent $112,000 for my first home. Could you imagine had the real estate agent, who actually didn’t, treated me just like a sale? Then I bought my second house for double the price and then my third house and my fourth and my fifth to now I’m here in Dragons’ Den and I’m creating this wealth.

Could you imagine if that $112,000 relationship had been kept to this point how much more successful that relationship would be for that initial agent? We have to look at relationships as very, very long-term and thus forget about the price because people go through cycles in their career, and you want to follow them through that cycle. It’s all dependent on how you treat them from when they’re at the beginning of the cycle to all the way through the cycle.

Erin: In their career and in their families. You’re going to need more bedrooms, you’re going to need fewer bedrooms. You might want to buy a second home, if you’re able to, for your children to live in.

Wes: Exactly right.

Erin: All of these and the importance of building relationships. Just before we get off this particular part of the conversation, Wes, and we’re just loving having you here today, how do we cope with our own humanity? How do we cope with our emotions and not let that overrule the sense of a business decision?

Wes: When you’re successful, there’s a lot of pride and ego that comes with success, the reason being is because everybody’s telling you how great you are. Your staff’s telling you, “Wow, you’re number one in the city,” or you’re number one in the province or you’re number one in Canada. Then all of a sudden, there’s other things that start to come with that. Hubris comes with it and you need to have people around you, they’re just not buying it.

I always use the expression with my wife that we’ve been married for 30 years next year. We go for walks every morning and literally I say she carries a pin around with her so that when my head is getting too big and bloated, she just takes the pin out and just pop it. That keeps me grounded because I know that that person, she’s going to call me out. I want people around me to call me out because that’s the only way that you are levelheaded because sometimes we get ahead of ourselves, and even the people that like us hate us as a result of it.

[laughter]

Erin: I can’t imagine.

Wes: I know. The kids are like, “This is too much, he’s too much.” If that start to happen, that means that you just aren’t surrounding yourself with the right people or maybe you have them but you’re not taking their advice. I know some of the most successful leaders that I know today are people who have amazing people around them and they listen to them, and they get good counsel from them and it allows them to be grounded and still be very, very successful.

One of the things that I look at as well is, philanthropically, if you’re a successful person, do you give back? Because it takes a certain personality to go, “I’ve earned all this money, I’m going to give it to help certain causes,” or if you don’t have it financially yet, to donate your time to mentor maybe kids in underserved communities or people who want to be a part of your sector to be able to bring them in and give them that free advice and mentorship. If you do those things and you do a lot of them, they automatically keep you humble.

[music]

Erin: When we come back with negotiator extraordinaire and newest star of CDC’s Dragons’ Den, Wes Hall, does he ever get intimidated? And a tough message that Wes had to deliver that ended up being called the best advice the anxious recipient had ever gotten. 

Every day, more and more Canadians are discovering the joy of house hunting, apartment searching, and all kinds of real estate finds from the comfort of their own home. In fact, there were 1.6 million searches for REALTORS® on REALTOR.ca last year alone. You can make the most of those visits with the REALTOR.ca tools we provide as part of your membership, REALTOR.ca. 

Now back to Wes Hall on REAL TIME. As somebody who leads shareholder activist campaigns, what strategies have you used for approaching sensitive or difficult negotiations because you are involved, you are giving back, you are being the person that little Wes in bare feet going to school needed at that time other than your dear grandmother? What strategies have you used? What do you keep in your heart while you’re doing this?

Wes: First of all, I’m never intimidated by people. I remember I was advising the CEO of a very large company; it was a hostile takeover and a proxy contest. I was brought in on the file pretty late. I was in my late 30s and this was a very big transaction. The CEO made a lot of fundamental mistakes in communicating to the market and strategic decisions that he made. These shareholders came out and said, “We want him fired.” The board and the CEO hired me to defend them. After analyzing the situation, I decided to set a meeting with the CEO, and I went into his office. His office was massive, massive, massive office. It took me like five minutes to walk to his desk from the door.

I sat there in front of him and I said to him, “I am really good at what I do, but there’s so many mistakes that were made I can’t help you and you’re going to lose this fight. My recommendation is for you to get into the boardroom and negotiate an exit package with the current board because we’re going to lose this fight and you’re going to have a hostile board coming in. It’s either negotiate with friends now or enemies later. Which do you prefer?” That’s a tough message because at the time, this gentleman was making a few million dollars a year in compensation and he had a great life. I told him there to go resign tomorrow.

The next day he actually resigned. Still today he’s like, “The best decision, best advice I’ve ever been given.” If I was intimidated by the size of his office, how much his compensation was, that I’m just this 30 something-year-old Black guy walking into this accomplished person’s office to give him this piece of advice, he wouldn’t have gotten the right advice because of me being intimidated and me being afraid to do the right thing and say the right thing because of how he was going to respond to it. We have to always appreciate that integrity first, that matters.

Sometimes we’re giving people advice that they don’t want to hear because we’re intimidated by them. If we allow that to stop us from giving the right advice, I don’t think we’re being good advocates, I don’t think we’re being good advisors. In the real estate business, that’s what you are, you’re an advisor. You’re going to walk into somebody’s home and you’re going to tell them, “I know you think this house is worth $10 million, but it actually doesn’t. It’s worth 5 and there’s a reason why f5 is a good price for it.” You’re going to sit there and go, “Well, you know.”

If you were intimidated to have that conversation with that person, you’re going to take it at 10, you’re going to try to sell at 10 and you realize that you can’t execute at 10. You’re going to bring them an offer for 5, which you know is the right offer, but then all of a sudden, your credibility is out the window because you weren’t upfront and you weren’t transparent in the beginning.

Always be transparent because at the end of the day, after giving that CEO the advice, if he didn’t resign and we lose and he loses everything because all of a sudden, the new guy’s coming in going, “I’m not going to negotiate your compensation package with you, I’m firing you right now and you have to sue me to get what you’re entitled to.” He would have been worse off in that situation. I would feel bad that I didn’t give him the right advice, to begin with, because I was intimidated or was afraid of what he was going to say. We always have to think about our integrity when we give advice, is this the right advice, and why? If the client doesn’t want to take it, you’re not going to have any regrets.

Erin: When we wrap up our talk today with Wes Hall, how to navigate the waters when you’re working with family, don’t miss it. 

In our previous REAL TIME episode, you heard about homelesshub.ca and so many more valuable links as part of our REALTORSCare® Week. REALTORSCare® is all about bringing you information to help you help others, a national guiding principle celebrating the great work done by the Canadian Realtor Community. You can help raise awareness for the charities and causes closest to your heart by sharing your story. Just use #realtorscare on your favorite social media platforms. 

Now back to our guest. He’s a master negotiator even when it comes to family, Wes Hall. I can’t imagine what it was like growing up one of your five children with a master negotiator. Did anybody ever get a raise in their allowance or how did you move your negotiating prowess into parenthood, or was this something that you left mom to do? How did that all work out, Wes?

Wes: First of all, two of my boys are working with me. One is working with me very, very closely. Last week, he said to me, “I know we’re on compensation season, so I just wanted to know what’s going to happen with my comp?” I said, “How much are you making?” He told me and I said, “Why do you need more than that? I’m paying your rent, you’re living with me at home, I’m buying your food. The only thing that you have to worry about is the clothes that you wear. Why do you need more money than that?”

[laughter]

Erin: Not fair.

Wes: That’s a reasonable response to it. He started to stutter a little bit because he didn’t really know how to respond to that. I said, “Plus, the work that you’re putting in, you’re going to inherit in the future anyways. Why do you need money now? You’re fine.”

[chuckling]

Wes: I said that in a sense that I want to see how he responded to it. He certainly held his own and justify why his compensation should be higher and he will get a higher compensation. What my wife said to me at times is that just remember that you were dad first and you’re their business person and the boss second. How you interact – When you’re working closely with your son or your daughter, especially in the real estate game where there’s a lot of families working together, sometimes we forget the fact that we’re just a parent first and the business will be fine.

I keep that in mind every time we’re having conversations, whether it’d be about tough conversations like compensation, conversation about discipline in terms of a work discipline, meaning that you messed up on this thing, and how do I respond to you? Do I respond to you as your boss or do I respond to you as your father? When I get home, do I have the boss hat on at home or do I have the dad hat on at home? I make sure that I’m very careful in terms of what hat I’m wearing when I’m having those conversations because it could ultimately affect our relationship in a very negative way if that’s not managed properly.

Erin: Is there a limit on how much shop-talk at home or over the dinner table?

Wes: [laughs] My wife manages that, Erin, very, very well. She’s very good about – We try to have dinner as a family at 6:00 PM every evening. Around the table, we talk about different things but we’re very balanced in terms of what we talk about. If I’m sitting on the couch reading a book or I’m watching a show, he doesn’t walk in and say, “Hey, by the way, that deal, here’s what’s going on,” and all that. He respects those boundaries.

If we’re having a five-minute conversation about something business at the dinner table, we do that but it’s not an hour conversation. It’s a very short conversation, but the rest of the conversation is about family, about us, and the business will come. We don’t overly focus ourselves on business, business, business, because that could be draining and there’s no time to unwind and there’s a lot of stress that comes with that.

To the extent that when I’m walking with my wife, for example, if I have something on my mind business-wise, that’s where it gets resolved because it’s amazing. When you’re talking to somebody who’s not in the sector that you’re in, they can see problems from a completely different perspective. I value that perspective because I would never have thought of the solution the way that she would think about it. I find that we solve a lot of problems in my business world by having those walks and having those conversations with her about challenges that I’m facing and coming up with a completely different way of thinking about it that I wouldn’t have.

Erin: You know, Wes, that once COVID’s over, you’re not going to be able to hide behind the mask and everybody’s going to be recognizing you from TV. Your wife’s going to need a bigger pin.

Wes: [laughs] It’s funny I was walking through the neighborhood, and this was when I was just announced on Dragons’ Den. This young lady walked by me and she turned around and said, “Are you Wes Hall?” My wife was with me, and I said, “Yes.” She’s like, “Oh, I love you. I can’t wait to watch you.” My wife after, she turned around, she looked at me and said, “Oh, man. I’m not going to live this down.”

[laughter]

Wes: I’m like, “See, I’m a big deal, honey. You got to treat me like a big deal.” She shaked her head and go, “Yes, never.” [laughs]

Erin: That’s great. Great, great, great. Thank you for helping us to talk about negotiating deals and everything that’s been a part of this, Wes. It’s been just such a pleasure, and you are a big deal.

Wes: Erin, you know what? You’re so kind, you should be my PR person.

Erin: [laughs] Oh.

Wes: [chuckles] I probably can’t afford you for that.

Erin: Now that you’ve taught me how to negotiate.

[laughter]

Wes: That’s right.

Erin: Thank you.

Wes: Thank you, Erin.

Erin: Best of luck to you in everything. I can’t wait to read an autobiography about you, or I’ll write it with you.

Wes: It’s coming out next year so stay tuned.

Erin: Awesome. Thank you, Wes, so much.

Wes: Perfect. Thank you.

Erin: Thanks again to Wes Hall for joining us for this episode of REAL TIME brought to you by the Canadian Real Estate Association. 

Remember to be sure to visit CREA.ca to access valuable resources and discover more fantastic real estate-related content. Don’t forget to hit that subscribe button. Will you, please? REAL TIME is produced by Rob Whitehead with Real Family Productions and Alphabet® Creative. I’m Erin Davis. Thank you for making the time to join us.

What’s cost-effective, functional yet invisible, and has the power to improve homeowner safety and strengthen communities? Universal Design: an approach to designing spaces that are inclusive and equitable for all. On Episode 20 of REAL TIME, we speak with Brad McCannell, Vice President of Access and Inclusion at the Rick Hansen Foundation, to explore the personal, societal, and financial value of adopting Universal Design practices in both our homes and shared spaces.

Erin Davis: Welcome to REAL TIME, a podcast for REALTORS® brought to you by CREA, the Canadian Real Estate Association. We are all about sparking conversations with inspiring people about all things Canadian real estate and topics that impact REALTORS®, and really all of us. I’m your host, Erin Davis and our guest for episode 18 of REAL TIME is actually a host in a lot of ways, and you’re going to find our chat fascinating. The appeal of vacation properties skyrocketed during the pandemic as Canadians look to create memories close to home. This scramble for real estate dovetails with another phenomenon, vacation rentals and the sharing economy.

With record numbers of people looking to get away close to home, can any property become a vacation property, and what are the pros and cons of investing in one? In episode 18 of REAL TIME, we take a closer look at the trends and opportunities with Heather Bayer. She’s a vacation rental expert, speaker, podcaster, broadcaster, and mentor of short-term rental managers and owners. Heather Bayer is also CEO of one of Ontario’s leading cottage rental agencies. We’re thrilled she could carve out time to be with us on REAL TIME during one of her busiest seasons ever. Thank you, Heather, for joining us. This feels like a virtual vacation and no matter the time of year, I think we can still all use one. I appreciate your time.

Heather Bayer: You’re absolutely welcome, Erin. It’s an absolute pleasure to be here.

Erin: You’ve been in the vacation rental business for more than 20 years. How did you get into the industry, and what makes you so passionate about it? Tell us your story, Heather.

Heather: What it was, it was very much by accident. I’ve been a serial entrepreneur since the 1980s. I love to start-up businesses, but until 1998, I’d had nothing to do with hospitality apart from partaking of it myself. In fact, at that time, back in 1998, I was running a management training company, I had a psychotherapy and hypnotherapy practice and happily hypnotizing people and running my training and it was great.

Then the adventure started. My brother was getting married in Midland, Ontario. Of course, as you know, from my accent, you can probably understand, I was in England at the time. He was getting married in Ontario. A week later, my niece was going to be married in Ann Arbor, Michigan. We had a family of 12 Brits and Scots, and we planned this two-week adventure and my brother organized our accommodation in Ontario. It sounded absolutely marvelous when he told us. It was a four-bedroom cottage on a pristine lake, and that’s all he said, and it’s something we never experienced before and we just couldn’t wait for this to happen.

What he conveniently forgot to tell us was that it was a water access-only property. Although we were ferried across to this cottage on this very nice motorboat by my future sister-in-law’s stepson, all we had after that was a tin boat with a nine horsepower motor, which was meant to ferry us back and forth to the mainland and the motor kept going wrong and things were happening. He also neglected to mention that the cottage hadn’t been occupied for the previous six months. At least it hadn’t been occupied by humans and it was overrun by mice and for the first three days, we cleaned the place.

Which sounds like a complete nightmare, but in fact, it was probably the most amazing vacation we’d ever had. We swam in the morning at dawn with the loons, I’m getting poetic here. We sat around the campfire telling stories and roasting marshmallows, and it was bliss, idyllic. On the last night, my sister and I sat on a rock and we were having a gin and tonic and looking out over the most amazing sunset, and I just said, “Hey, we could do this. We could actually buy a property and rent it out and do it much better”.

My husband always raises his eyebrows. When I always say those four words, “I’ve got an idea”, he wants to run a mile. I went back to UK and decided we’d go into the travel industry, and I was going to source the best in Ontario cottages and rent them to the British market. Oddly enough though, in a couple of years we did that, we got more business coming from Toronto, calling us in the UK and trying to rent a cottage two hours north of them.

Eventually, I moved out in 2003. I’d had enough of going backwards and forwards to Ontario every six weeks to buy another property because we kept buying them. We had six at one point and I was also looking at third-party properties and managing them from England. My husband had been in the UK military in the RAF for 35 years and it was time for him to retire. We said, “Hey, let’s move to Ontario.” That was the start of the adventure and here we are 18 years later.

I now run one of Ontario’s most popular rental management companies along with my business partner. We have 160 properties and I’ve written a book about how to rent. I have a podcast with 400 episodes and nearly a million downloads now, and I live, eat and breathe this business. Yes, the passion that started in 1998 has not waned one iota since then.

Erin: What an incredible story. I’m still stuck on the hook that you were a hypnotherapist and a psychotherapist because I want that in everybody that I know, oh my goodness, boy, you changed lanes in such a big way. Of course, the whole world did in the past year and a half, Heather, with COVID-19 having such a major impact on travel and tourism. What have been the immediate effects on Canadian vacation rentals that you’ve seen?

Heather: It’s been a story of famine and feast really because it depends where you are. Here in Ontario, we serve a domestic market, so 90% of our travelers come from the major cities from Toronto, with less so from Ottawa, but it’s domestic. When the borders closed and people couldn’t go traveling, they decided that they would stay at home and do the staycation, and that turned out to be the best year in 2020 for us. This year, 2021, it is just as busy, if not busier. We’ve never had busier years. However, that’s not the same for every part of Canada because there are areas that don’t have that high level of domestic travel. They have more international travel people crossing over the border.

For example, property managers and owners, let’s say in Canmore and Banff, less likely to have a domestic market because it’s only an hour or an hour and a half away from Calgary. People are more likely just to do a day trip rather than to book accommodation because the majority of their business comes from the US. Many of the managers I spoke to have told me about the famine effect. It’s been the same in the urban markets for those who had properties say in downtown Vancouver or in Toronto or in Montreal because people weren’t visiting the cities anymore. It has been either feast or famine.

Erin: Do you expect, Heather, the pandemic to influence any long-term trends even after we returned to, “Normal”?

Heather: The issue of what’s going to happen next year, don’t we all wish we had the crystal ball, and people say, “when we returned to normal”, always waving those air quotes to normal, we look at it two ways. We’ve had to explain to a lot of new owners this year when they bought properties and they paid a lot of money for it, and they are coming into it at a period of the highest rental rates we’ve ever seen.

We raised our rates between 25% and 30% this year just to remain competitive, and owners have come in saying, “This is amazing. I’ll feed this into my spreadsheet.” We’re going, “Whoa, whoa, whoa.” 2022 could be very, very different because we don’t know what’s going to happen when international travel helps people to move south and move east and west, just go away from where they’d been stuck for the past 18 months.

On the other hand, some people have found the secret door to what’s in their backyard, which is lakes and areas of pristine natural beauty that they may not have even realized was so close to home. Yes, a crystal ball would be fantastic. I’m ever the positive. I always have a glass completely full, and I am suggesting that we will probably maintain some good rates next year, good occupancy, but there’s always a but isn’t there? We’ve also had this massive increase in rental inventory as well because everybody that’s come in and bought properties has been wanting to rent it. We’ve got a large inventory too. There’s a lot of moving parts in this and we have a lot of fingers crossed right now.

Erin: In talking about the prices of cottages and cabins having skyrocketed by as much as 30% and I’m sure you’ve seen percentages even higher than that, Heather, does renting the property suddenly make owning more realistic for the average Canadian?

Heather: I think it’s the only thing people can do unless they’ve got oodles of money and can maintain two properties, one of which they just spent way over the odds to get hold of, I think they have to rent. In the past, rental was seen as something that you did to just fund the project, fund the renovation or a new deck but now, the buyers that I’ve been speaking to over the past year see it as an absolute part of their investment strategy and it has to be built in to ensure costs are covered.

There’s the mortgage, there’s taxes, there are all the costs for rentos because many people have bought properties that need significant renos to be able to be put into the rental market. Yes, renting does make it more realistic.

Erin: Coming up with three kinds of rental property buyer. Are you one of them or perhaps one of your clients is? As we mark a year and a half of CREA REAL TIME episodes, why not take the time to do a bit of a deeper dive into some of the fascinating and still very timely chats we’ve had? REALTOR® Chris Jovic is an expert in his field on sustainability and you probably saw him quoted on CBC just last week in a piece about climate change and homeowners’ protection. You’ll find him in Episode Two of our first season. Subscribe, so you don’t miss any of our talks. Go to Spotify, Apple, Stitcher, or visit CREA.ca/podcast for more details.

You have cited that there are three types of buyers, can we break it down into the three, and then we’re going to focus on one of them in particular because I know you’ve piqued a lot of people’s interest in this today, Heather? Let’s dive into that a little bit, shall we?

Heather: Buyers come in many different shapes and forms but you can usually put them into three separate buckets and the first one is the traditional family buyer. This is usually people who’ve been brought up going to the second home, whether it’s on Vancouver Island, whether it’s in Ontario, whether it’s in Nova Scotia, it doesn’t matter. They’ve had the second home that they were brought up as kids going to on vacation.

As these kids have now grown up into adulthood with their own families, they want to recreate that and we see a lot of those, “We want to buy something so our children can experience what we did when we were kids”. Sadly, I don’t think it’s going to work out that way because when those parents were kids, there was no internet, technology wasn’t as it is now and I think it’s a little bit of a pipe dream expecting that their kids will be just as happy with some water and some sunshine and not have YouTube and TikTok however-

Erin: Logging on meant actually putting wood in the fireplace.

Heather: I love that. The second group are the retirees. The ones that are looking at it and thinking, well, if I don’t buy in now, I’m not going to get into it in the future and I want to retire to this place. They want to get in early, buy what will be their second home, and use rental to pay off as much of their costs as possible until the time comes for them to sell their primary home and moved to it. We see quite a large proportion of those as well and while they’re not using it, they’re going to pay for it by rental.

Then the third type are the pure investors and Airbnb has delivered us a lot more investors because it’s made it so much easier for people to get into the business and taken a lot of the work away from it. An investor can come in, buy a property, perhaps engage a co-host, somebody who will manage it for them online, and then they just sit back and take the money and that’s a very lucrative business if you’re doing it in the right area.

Erin: It sounds very lucrative. It sounds very attractive and now we’re going to focus on that, let’s hone in on number three, that third group. What would you say, Heather, are the benefits of owning or managing a vacation rental and don’t forget this woman has been doing this for 20– and I’ll say 20 odd years because I’m sure they have been odd, my dear.

Heather: Still are.

Erin: I bet you. Every day, a new adventure, if you want to call it that. All right, what are the benefits of owning or managing a vacation rental, Heather?

Heather: The benefit, certainly from an investor standpoint, is over a period of time, that property is going to increase in value, that’s basically it. When I started to invest here in Ontario, it didn’t take very long for my investment to increase in value, and I was able to use rental to pay all the costs involved, and the capital grew, and I sold each one for a nice profit, but that didn’t take very long. Now I think the benefit is only if the investor is going to be in there for the long haul because we don’t know what’s going to happen with property values.

There’s benefits to doing it yourself. There’s two models of running a short-term rental business. I say business because every single person who buys a property to rent is going into business. They’re joining the travel and tourism and hospitality business. Something I always say to my owners when we first take them on board as property management clients, is regardless of whether you’re doing it yourself or you’re using a property management company, you’ve now entered the hospitality industry and there’s huge responsibilities that come with that.

Erin: That really does seem like an aha moment, I think, for a lot of people, that suddenly you are part of the hospitality industry, you’re not just mom and dad renting out a cottage on an island or something, you’re part of a much bigger picture.

Heather: Yes and mom and dad did it 20 years ago and they just put the sign on the lawn or a classified ad in a newspaper but now to achieve success, it has to be done professionally. Every part of it has to be done professionally. From the photos that are taken, to the amenities that are offered, to the level of communication with guests. It’s no longer the quick phone call with somebody saying, “I want to rent your place” and you saying, “Yes, come and give me $750 at the door when you arrive on vacation and leave it as found.”

I’m glad I experience that actually because I remember arriving at so many properties to find that the previous guests hadn’t cleaned it so I had to start cleaning it myself but that was the way it was then. Now, it is so, so different. People are expecting– let’s talk about the guest expectations because guests, we don’t call them renters any more, they’re guests and they have massive expectations.

They expect their vacation rental to be as well presented as a good or top class hotel or resort and any deviation from that brings a complaint and that brings me to something else is that we live, eat and breathe by reviews. Anybody going into the business now has to understand that that you can’t go into it half-hearted because the moment somebody gives you a negative review, wherever you are, whether it’s on Google or Airbnb or VRBO, that almost can spell the death knell for your business at the very outset.

Erin: Coming up the pros of hashtag book direct. How many people use the bigger companies and why your client may want to go his or her own way or not? Whether it’s by a lake or walking distance to the best mall in the city, the heart of your home is the living room, we get that. It’s why REALTOR.ca Living Room is your source for free engaging content for your social feeds. From key 2021 housing trends to design tutorials, Living Room is here to bring you entertaining and inspiring articles. Pull up a chair and join us there, won’t you? 

Now back to Heather Bayer, CEO of one of Ontario’s leading cottage rental agencies and our guest on REAL TIME. What share of vacation properties are independently owned and managed, do you think, Heather, versus those managed commercially or by an agency?

Heather: There’s two ways of renting out a property: one is the do-it-yourself model and the second one is to go with a property management company. I don’t think I’ve seen any real statistics that show what that ratio is. I would say it’s somewhere around 70% independently managed and maybe 30% are managed by professional agencies. I could be way off whack there but that’s what it’s certainly what it seems to be here in Ontario when I look at the wealth of properties that are available on some of the major listing platforms.

By listing platforms, I mean platforms like VRBO, what used to be Home Away, what used to be Canada Stays, they change every month, it seems and, of course, Airbnb, but if you go through Airbnb listings, you’ll see probably about 70% of them are managed by the owners and probably about 30% are managed by agents.

Erin: Do independent investors compete with property management agencies for the same business, do you think?

Heather: Oh, yes, absolutely. Yes, we all compete for the same travelers. I think what we have as property managers that stands us out is that we have much better marketing clout. We don’t have to just sit on Airbnb or VRBO. Every property management company has their own website; they go for the direct bookings. In that way, we tend to achieve many, many more repeat guests because we are encouraging people to come back to us. If you’re advertising on one of the major platforms as an independent owner, somebody will see your property and then perhaps go on to another property and never come back to you again.

At least with an agency, as a guest, they’re probably going to stick around with that agency if they get really good service. About 70% of our guests are our returnees every single year, not necessarily to the same property but they come back to our company every year. That’s the same for many of our competitor companies.

Erin: Well, and that’s the best review you can possibly get, isn’t it? That and referrals, right?

Heather: Oh, absolutely. When we have guests who are now on their 16th, 17th, 20th visit, and they post that on a Google review, you don’t get that if you are doing your own advertising. That’s a benefit. That’s real benefit of going with an agency. I always talk to new owners just about these two different options they have and suggest that, start with an agency and get your feet on the ground of this hospitality while somebody is holding your hand and they’re helping you through absolutely everything, they’re dealing with the issues that come up, but then sharing why those issues came up and how you can prevent them in the future.

We have a lot of owners who come to us maybe for the first one or two years and then go, “Right, I’m ready to take the training wheels off now”. They go off, they create their own websites, and love doing the marketing and management themselves. You have to bear in mind that it’s not just a matter of posting a listing on one of these websites, you have to expect to hear from your guests, sometimes 10 times a day with the most minor things.

Erin: Okay, the questions and I’m sure a lot of them have to do with things that maybe perhaps city dwellers have never seen before like there’s a skunk in the yard, what do I do? Or there’s squirrels or whatever, you’ve probably heard them all, Heather, I’m sure.

Heather: Well, yes. Just recently, “There’s a bat in the bedroom”.

Erin: Oh, how lovely.

Heather: Guest woke up in the night, and there’s a bat flying around the bedroom. This is two o’clock in the morning. Now we have a 24-hour call answering service and somebody will answer the phone at two o’clock in the morning. We were talking these guests through their panic and their fear and anger because we had let this bat in apparently. 

Erin: Yes, really, your fault. That has to be something that a potential owner who’s looking to have guests in their property is going to have to be able to commit to. You are basically on call 24/7 or you’re not giving people maybe what they’ve come to expect.

Heather: That’s exactly it, Erin. We are on there 24/7 and I noticed last night, my customer service manager was still answering texts at half-past eleven about how to get the Wi-Fi to work in a property. For that guest, it is hugely important to them. They might be night people and they’re going to spend the evening and night working and they need that Wi-Fi. Yes, if you’re doing it yourself, you’ve got to have somebody who’s able to deal with those things at any time because we live in a 24-hour society and we can’t just say, no, you’re only allowed to have an emergency between the hours of this and this and your emergencies can only be in these categories. 

Erin: Yes, that’s right. Because people aren’t all just there to kick back on floaties. There are people like us who work from remote locations and need that Wi-Fi. Okay, well, you know what, we’ve talked about remote locations in terms of truly rural and remote but can any property like a condo be a vacation property, Heather?

Heather: Any property. You’ve talked about RVs and trailers and things being turned into rentals. Yes, there’s tree houses and there’s yurts and air streams. Absolutely anything can be out there now as a short-term rental property, providing it meets with local regulations and that’s the big, big issue right now. Cities, townships, municipalities across the world are getting into the idea that this industry must be more regulated than it currently is.

Erin: Do you agree that it needs more regulation?

Heather: I do. I do agree that it needs some regulation. I’m fully in favor of licensing properties because I believe that a licensed short-term rental property that meets the proper safety regulations, et cetera, meets occupancy limits, is a responsible rental. The whole issue of responsible versus irresponsible rental is what has made some of these municipalities and townships go this route anyway. I’m in Huntsville, Ontario, we have a great system, every short-term rental property has to be licensed, somebody will come out to the property and check that there are fire extinguishers and CO monitors, et cetera. Check for egress.

You can’t rent a place with a bedroom that has no window, that hasn’t got the two methods of egress, for example. Once you’ve gone through the licensing, then it goes up on the township website and the guests actually pay a 6% hospitality tax to stay at that property. That tax goes to the township. Now, there’s arguments against this, but quite honestly, I think fair regulation is what we all need.

Erin: It is because there will always be those who ruin it for the rest of us and you also have to make peace with the neighbours too, in terms of occupancy and noise. We’ve all started to see signs in different areas that say “Ban short-term rentals”, and that’s not a nice feeling if you’re going in there for a week or two to know that you’re not welcome. If everybody’s on the same playing field– I do have a question, Heather, how much is the license? Do you know?

Heather: The licensing varies, certainly here, every township seems to have its own. They vary from $500 to $2,000. Once they get up to that level, they are trying to knock out the small players, which I think is a shame, because often, it’s the smaller rental operations that just renting two or three weeks a year to pay some taxes, those are the most responsible.

I think putting a high figure on licensing cuts those out. The people who are buying multiple properties, investing in multiple properties just to yield the greatest income aren’t going to be bothered by $2,000. I prefer to see the lower rate, $300 to $500 on an annual basis to pay for inspection and have some fair criteria for rental. One of them being occupancy so that we don’t see a three-bedroom cottage being open to 20 people, for example,

Erin: Right, there’s that. That’s where their screening of the potential guests comes in too. It goes back to being in the hospitality industry. If you’re just some person who’s playing with a whole bunch of little houses and hotels on the Monopoly board, you don’t really care who goes into them but if you’re invested in that property and in your neighbours, you want to make sure that those people going into that place are not going to be partying at all hours because they’re on vacay, right? Or in the one case, you had someone who was complaining because the guests were too darn friendly.

Heather: This is an issue that you will get in more residential areas where there’s been an influx of short-term rentals where it was all generally nice and tranquil residences, and now you have what they’re calling the revolving door. Every week, a new group arrives. Every week, they’re excited and they can’t wait to get going on vacation, and they meet the neighbours and the next-door neighbour is really friendly and they ask him over for a drink or ask the family for a barbecue. That was when we did hear from one neighbour of a property that said, “I really like having the rentals next door but could you possibly tell them to stop being so friendly?”

He said, “Because if I responded to every request or every invitation for me to come across for drinks and a barbecue”, he said, “I’d never get my gardening done”.

Erin: Oh my goodness, one must have his priorities. Oh boy.

Erin: When we return with Heather Bayer, the important big eight questions a REALTOR® needs to ask if a client is considering buying a property and entering that hospitality business of which Heather speaks. Here’s another number, nearly two million, that’s how many searches there were for REALTORS® on REALTOR.ca in 2020. You can make the most of those visits with the REALTOR.ca tools provided as part of your CREA membership.

What questions should a REALTOR® ask their client to determine what kind of vacation property is going to be the best fit? Because I think if I’m living in, let’s say Toronto, because you’re talking about Toronto and Midland, I think, okay I’d like to get someplace say up in Georgina or Keswick. Certainly, I can’t go in there knowing little but a REALTOR® who’s going to represent you should make sure you’re going to be the right fit for this kind of a position as a hospitality owner. Help us help REALTORS® know what to ask and find the right fits. Would you please, Heather?

Heather: I think it’s really important that a REALTOR® assesses what the buyer’s goals are for rental, is it for pure investment? You want to get the maximum out of the property. In that case, then the property they should look out should be year round not a seasonal property. Also, to find out what level of ownership they want. How much do they want to use it themselves. Because you get to this point where you think, do they want this as a pure rental? In which case they might want an entirely different property from one that they’d want to use themselves.

For example, a nice riverside property that is rentable year-round may suit somebody who wants to get as much rental income as possible because a river property will rent. It’ll rent really well, but it may not suit a family who wants to use a Sea-Doo or go water skiing. They will be better off getting out onto a lake. Whereas rental guests in general don’t have their own boats, so they have different needs. It’s a matter of assessing the needs of the owner and telling them about the different types of things that guests want because often what owners want and what guests want a very, very different.

I actually like to, if it’s okay, I’ve got some questions actually, that an owner would ask a REALTOR®, which is turning your question around a bit, but there’s eight key questions that your buyers could ask. If you can get these answers right, then you’re going to have a happy buyer who buys the right place.

The first one is, they’re going to say, what’s the best area to buy for getting the best rental occupancy? You mention Georgina and Keswick, that may be okay in terms of summer occupancy, not great for the Winter. You might know that to get up somewhere where there’s a ski area, maybe not so much Collingwood, but perhaps up towards Mount St. Louis Moonstone, about two hours north of Toronto, they’re going to get better rental value in that area. It’s about knowing the different areas where they’re going to get the best occupancy.

Second question: what rental rate should I expect in each location? That’s just a matter of researching what’s being charged for different styles and types of property.

The third question is what do rental guests look for in a vacation property in this location? Your knowledge of the tourism demographic is important. If you have that information to hand to know that there’s a strong winter market and to know that you’d need an open source of heat, a fireplace and a sauna, might be more important than a on-suite bathroom, for example. Travelers have very different needs than the second homeowner who’s using it for their own purposes.

The fourth question would be, do you know of anybody who can manage the property in my absence or who can manage a property for me? That’s all about talking to local property managers, rental managers and finding out what services they offer and perhaps going into some referral partnership or something like that. We work with quite a number of real estate agents just on a very flexible basis that really, really helps because they know how we work.

The fifth question we’ve just covered, every REALTOR® needs to know what restrictions there are in any area because these restrictions are becoming more commonplace. Awareness of zoning, bylaw restrictions, anything that’s there and also anything that’s upcoming. It’s always worthwhile really. This is a really good tip that I heard from somebody else is in an area where somebody is looking, go into the municipality or the township website and look at their meeting minutes and just put it in the search box, short-term rental. Something may come up that says somebody raised this and there’s a likelihood that there’s going to be some action taken in the future.

Number six: how is rental income taxed? That’s always good to know because we’re always asked that, I always refer people to an accountant, but you will get asked that question.

Then number seven is knowing what the seasonality of rental activity is in the location. Majority of areas have seasonality built into the rental potential. Just go into the local tourism office. They will usually have that information on the inbound traveler demographic. Low and shoulder season vacancies can really impact a bottom line. Any prospective owner wants to have a clear indication of what they should expect, particularly in areas where there’s a high concentration of rental properties.

Lastly, and I touched on this, is who is this rental demographic? Where did the guests come from? As we’ve seen in the last two years, that is super, super important. Is it a driving location? Is a domestic market? Is it predominantly flying? What’s the age demographic? How long do they stay? Do they stay for short, two nights? Do they stay for weeks?

Those are the eight questions that I think every REALTOR® should be prepared to answer. You could actually create a binder for prospects demonstrates that the vacation rental business and how it’s presented and operated in your area because that’s so invaluable for anybody wanting to invest.

Erin: Absolute gold. There’s more to come including a real eye opener for me and probably for you on how potential property owners can keep their eye on just how many people are in their place. It’s not how you think. I love learning new things through hosting REAL TIME and I hope you feel the same way listening. Here’s another way of tapping into the knowledge of REALTORS® across the country and sharing your own lessons and insights. Visit REALTORS® Corner on CREA Café, a hub of content created by REALTORS® for REALTORS®. Check it out.

We return now to Heather Bayer, vacation rental expert, a speaker, podcaster, broadcaster, and mentor of short-term rental managers and owners. Heather Bayer is also CEO of one of Ontario’s leading cottage rental agencies. She wants us to remind you to #bookdirect.

Before we look back at 2021 and maybe ahead into 2022, let’s talk a little bit about high-tech. You mentioned a binder and there something about holding a folder in your hand and looking through those pages and knowing that your REALTOR® knows her or his stuff when it comes to what you want to know. I can’t even fathom the changes that you’ve seen in the past 20 years in what you’re doing and how it has changed things. How do you anticipate tech is going to further transform the short-term rental industry in the future specifically post pandemic, Heather?

Heather: Tech has come a long, long way. Nowadays there is tech for everything. I was talking to an owner this morning who was talking about how do we know how many people there are in their property? In the past, I would’ve said, well, you don’t, you don’t. Once people arrive, if it’s a remote-ish property, you don’t know whether they brought in 10 of their friends. Now you can use a device called StayFi. That ensures that anybody in the property who wants to connect to the Wi-Fi has to register their email address.

Erin: Oh, that’s good.

Heather: There is another one called Party Squasher. That one just detects how many working devices there are in the property. It would detect how many phones, how many tablets, et cetera.

Erin: Wow. I thought you were going to go with ring cameras and stuff, and that can get hanky, right? People don’t want big brother or sister watching over them, but it’s your Wi-Fi, you’re paying for this? Oh my, that’s fascinating, Heather.

Heather: There’s a third one called NoiseAware. Which I love NoiseAware. This is better for maybe for condos because it measures the decibel level in your home. You can set it to a particular level and for a particular duration. If you’ve got a family in there and they’ve got a screaming baby, then it’s going to register. If that goes on for an hour, you might consider that maybe it’s not a screaming baby, it may be this fledgling party just kicking off.

Erin: Or hit the Mary Poppins App and make her appear and take care of the child. That’s your next thing, Heather.

Heather: As an entrepreneur, I’ve just filed that away.

Erin: All right, so let’s do this. Let’s fast forward a few months. How do you hope to describe 2021 when you look back on the year?

Heather: Best year ever.

Erin: Good for you.

Heather: Well, that’s me. I hesitate to say that because it sounds as my nine-year-old granddaughter goes, “Grandma, you’re bragging”.

Erin: You’re not bragging if you can do it. That’s what I say.

Heather: Exactly. Yes, best year ever, but also, I look back on a year of learning because we’ve had plenty of time to learn. The first six months of our year were canceled, basically. We’ve had everybody out there learning new stuff. It’s also been a year of tolerance. We’ve learned that everybody is so different and people will react to things in very, very different ways. We’ve seen that more so in the last year. I think we’re coming out of this. I’m talking in terms of my company, we’re coming out of it as a kinder, more tolerant and accepting company.

We are far more accepting of somebody who’s going to flip out because the neighbours have a party one night, and we’re far more accepting of somebody who goes bananas because there’s an ant. People are reacting. We used to say they’re overreacting, but no, they’re just reacting a little bit differently to what they would normally do. I really thought about this and I think tolerance is the biggest thing that’s come out of it for us, but also a lot of excitement about getting out of all this and what’s going to happen in the future.

Erin: Oh, I love your full glass, Heather. Thank you. Thank you. Thank you for joining us. It’s been insightful, delightful. I got to give you a plug here because you’re in the midst of writing a course.

Heather: Yes, I am building a course for people who are going into this business, who are going to invest and want to treat it as a business. I wrote a book back in 2005 and then went into the podcast. Now I think I’m trying to get it all down into a really easy to digest course.

Erin: The book was reprinted in 2007, so your message is getting through and the changes, it seems like it’s almost time for a re-up, in your spare time, Heather.

Heather: Well, that book in 2007, when I look back on it, and particularly I look back on the marketing side, and it’s how to write your classified ad.

Erin: Oh my gosh, it was delightful talking to you, Heather. Thank you so much and may the future be as full as you see it. You deserve everything.

Heather: Thank you so much, Erin, it’s been an absolute pleasure talking to you.

Erin: Don’t miss our next REAL TIME Episode. We’re going to the polls in a few weeks, and our CREA REAL TIME Team, along with Alphabet Creative is putting together analysis in real-time as we move into the future in Canada. 

REAL TIME is produced by Rob Whitehead and REAL family productions plus Alphabet® Creative. Thanks again for joining us. I’m Erin Davis. We’ll talk to you again soon on REAL TIME.

We might think we know what characteristics define each generation, even when it comes to real estate. Baby Boomers are downsizing, Millennials can’t afford to break into the market, Gen Z are tech obsessed, and Gen X… who are Gen X again? But are any of these prevailing notions true, or are they just stereotypes? In this special episode of REAL TIME, we talk to four REALTORS® from across the country about their experiences with clients of all ages and how each generation is navigating and redefining the landscape. First, we chat Gen X and Gen Z trends with Davelle Morrison and Austin Titus. Later, we explore what’s hot in real estate for Baby Boomers and Millennials with Rob Marland and Tanya Eklund.

Erin Davis: Welcome to REAL TIME, a podcast especially for and about REALTORS® brought to you by the Canadian Real Estate Association. I’m your host, Erin Davis. Today we have a guest who’s going to open the doors and open our minds to the possibilities of PropTech. Think you don’t use it? Think again. Nikki Greenberg is a PropTech entrepreneur, architect and real estate futurist. She joins us now on REAL TIME. Welcome, Nicki, joining us from Sydney, Australia tomorrow.

Nikki Greenberg: Thanks so much for having me. Yes, it’s tomorrow from me already with the time differences.

Erin: You’re in Sydney, Australia, and we’re in Sydney, British Columbia. We’re just one wrong airline ticket from being together.

Thank you so much for joining us. I know this is going to be enlightening. You’re a passionate advocate of property tech. Let’s start by defining it. What is PropTech?

Nikki: That’s a great place to start and I am very passionate about PropTech. It really is an emerging field and to some of the listeners, if they haven’t heard about it before or if they’ve only started hearing about it recently, there’s a reason for it because the term actually really came to its own maybe about three, four years ago. There were different versions being thrown around. Is it Cretech, is it Retech, is it PropTech? PropTech is the term that essentially stuck around being short for property technology.

Now, there’s a few things that I just want to explain to your listeners just to essentially set the stage because there are concepts that I will be referring to later in just understanding exactly what PropTech is. The thing about PropTech is that it’s really made up of three different verticals. You have real estate, you have technology and you have venture capital and where those communities converge is where you have PropTech.

What’s quite interesting about this is that because you have these three different communities, they also come with different languages and different ways of working. That’s one of the challenges, especially for real estate professionals coming into this industry and trying to understand the whole PropTech ecosystem is not necessarily a language or a way of thinking that we’re used to because we’re often used to talking to engineers and real estate agents and other real estate professionals. That’s one of the things that is often a barrier to people initially becoming involved, is that it is quite a different ecosystem.

The second thing that I want to just point out is that purists believe that PropTech does actually need to be a technology, which means that it’s something that is a hundred percent pure tech, no hardware, no spaces. It’s not about the physical, it’s about the digital, but for most people within PropTech, there’s an understanding the ecosystem essentially has two sides.

There’s the technology itself, pure technology and then there’s another side which is essentially tech enabled real estate. What that means is that it’s real estate that is operated through technology and that it wouldn’t be able to operate in such a way if there wasn’t this new generation of technology that’s come out. Examples of this co-working or co-living because these are actual spaces, but it’s the technology that allows them to work.

The third thing that I want to just point out also is just an understanding about PropTech versus regular technology in real estate and why there’s a bit of a differentiation. We have obviously working in real estate, there’s always been technology at our disposal. This is nothing new. Then we pose the question about, okay, well, if we’ve always had technology, then why is this whole area called PropTech? Why is there a whole different field? Is it just a buzzword or what’s going on?

The thing about PropTech is that PropTech really describes this new generation of technology that’s come out using AI or machine learning or very user-friendly interfaces that’s not talking together, that work on the cloud that embrace IOT. It’s essentially this new generation of tools that we get to use in our industry that just has a fresh approach is user first and is super smart. I know there was a very long explanation that I just really wanted to set the stage for your audience.

Erin: Thank you for that. I appreciate it, especially with the focus on the real estate industry and the relationship of PropTech and the real estate industry. How does real estate influence other aspects of PropTech?

Nikki: With real estate, what we’re talking about it’s really about having fixed assets. What you’re talking about in PropTech is you’re talking about technology. We’re having this relationship that goes on that’s symbiotic and reliant upon each other. As I described before, what we can have happening is that you can have take enabled real estate that relies on the technology, but then on the flip side, you also need to understand that the technology itself and technology providers also need to have space around them. In the real estate industry, we also want to be thinking about the needs and the spatial requirements for those tech companies.

Erin: How has PropTech evolved over the last decade or so? You’ve even talked about the different conversations. Well, what are we going to call it? It’s so new that it’s still got that new baby smell to it. How have you seen it evolve over the past decade or has it been with us longer than that? Now we just have a name for it and we’re able to put it in a column, Nikki.

Nikki: I think that’s great. I love the idea of the new baby smell. There’s a few things that have happened in the past few years that really differentiate this new generation of technology. Some of them being the move to us using smart phones for everything and having these as devices. Our traditional technology has been operated through a desktop computer and it might be on the windows operating system, for example, whereas with PropTech, what just starting to do is understand that a lot of the technology is working off our smartphones and devices.

Another move is also using the cloud increasingly. That means that we’re not having to be storing our documents in a fixed location. Then of course around the cloud, there’s all that hard infrastructure that’s needed in terms of data centers. This new generation of technology is– and as the internet has really come into its own is that it’s all internet first. We’re not talking about local technologies, we’re talking about networks and devices and information being able to connect across geography, which is something that’s quite interesting and definitely wasn’t part of the earliest software.

One of the other big trends we’ve seen over the past especially over the past decade is the rise of the shared economy. This tech enabled real estate that’s come through. A lot of it has existed before but this is a formalization of some of it such as before there was co-living, there were roommates and before there was co-working, there was sharing an office space, but now what it is it’s about really formalizing the brands and creating productizing what’s available to benefit the consumers

Erin: Just to dumb it down for me anyway, Nikki, what is the difference between co-living and roommates since you brought up that example?

Nikki: With co-living, there’s some great brands around it and essentially what’s happened there is that the operators have created consistency. There’s always been a demand and a market to share a space with someone for various reasons, an obvious one being students wanting to share the costs of renting a place where they could get a nicer three-bedroom place rather than a one-bedroom place to have a sense of community.

Now there’s always been these benefits, but what happens is that when you do have an informal setup, there’s disadvantages to it. Number one being consistency. You don’t know what you’re going to get, being able to find what you need. Again, in informal economies, you might be able to find a flat-mate, but where are you really going to look? You’re looking at a few different places.

In formalizing and productizing some of these concepts such as co-living, there’s certain advantages that come out and then by building brand loyalty and understanding the customer and creating beautiful products that compete with each other and do so in an elegant way that puts the customer first. Then there’s also ways of then expanding upon the offering to keep getting better and better and better. The flip side of that is that if you have a share house with say, five people living in it, there’s no incentive for the share house to get any better, but when you have a co-living situation, there’s always learnings and data that comes through to be able to offer a more and more optimal experience.

Erin: When you talk about embracing PropTech for the workplace and sharing workspaces and that sort of thing, how much do you think PropTech has been fueled by so many people working from home during the pandemic? Is this it’s moment? When you look at zoom, for example or the technology that you and I are using today to be talking to each other from different hemispheres, how important has that been in pushing forward PropTech into the 21st century and into this decade?

Nikki: You’ve absolutely recognized the trend that’s happened. A lot of the conversations that I have, have been with both real estate operators and owners and with technology companies. What the technology companies were finding is that with lockdowns that have happened and the move to working remote and this need to work in a more digital way that some of the barriers to adoption of their technology were removed and that clients that they’d been speaking to for quite some time suddenly came back to them and said, “Aha, now I get it.”

The interesting thing is that this has actually happened across a few different types of technologies. One of the first to really feel the upside of that was around tenant management apps and being able to communicate with people in workspaces because there was a need, a recognized need that if you do have a class, an office building, for example, you want to be able to communicate with the people within the building, whether it’s messages around how to use the lifts, different hours of access, also to be able to let them know about new procedures and also community activities that might be going on. They definitely felt an upside.

Another area that felt an upside very quickly was really around health and wellness providers because again, with the return to the office, there were concerns around indoor air quality, for example, and a need to start understanding some of the health ramifications of these spaces. They certainly came into their own.

Then of course, within the venture capital landscape, there’s been a lot of investors that have either been in the area for a while or are starting to enter the area. Again, there’s just been this reckoning of understanding. Well, real estate is fundamentally changing as a result of the pandemic and technology can provide a lot of the solutions that we need.

Erin: Coming up, fun with Nikki, as she looks at advances in the world of architecture and digital construction design. First, we are super excited to share that Canada’s number one real estate platform, REALTOR.ca, now has a brand-new app Rebuilt from the Ground Up and designed to reflect the needs of today’s home buyers. The app helps REALTORS® get connected to more potential clients, download it on the app store or get it at Google play.

Now back to our guest on REAL TIME, futurist and PropTech entrepreneur, Nikki Greenberg. Let’s talk about construction because this is one of your many wheelhouses, Nikki, as an architect. What can you tell us about advances to the design process?

Nikki: This is a fun one, and I honestly, I wish some of these tools were around when I was working as an architect some years ago, but there’s been a lot of advancements that have been happening especially in automating and generating designs. There’s a few tools that come to mind and I apologize to listeners, I don’t tend to mention companies by name. Often that come across as a recommendation and I don’t want to do a disservice to anyone because there are different companies working within the space.

There are certain tools for example where you can find a building site and then essentially plunk on digitally a model and then figure out, okay, well, what happens if there’s retail? What happens if there’s commercial? What happens if there’s apartments? You can start actually moving this model around within the envelope of what’s permitted by the building code to start getting actual feasibility studies.

As an architect, when I used to have to do these things, it would take hours and hours and hours and hours because one little change would affect everything. To be able to just do an automated model is fantastic. There’s other models that are out there that can look at a city, for example, and identify opportunities for investment sites, just realizing that they’re underutilized.

There’s tools that now can generate, for example, an office layout. You can just give the tool essentially a full plate and the parameters and then in the background, the robots do the work and before you know it, you can have different options of office layouts. There’s a lot that’s been happening in that regard. For me personally, I think it’s fantastic because what you’re doing is you’re taking out a lot of the repetitious work and you’re able to give more options quicker which is something that I think is very exciting and then essentially frees us architects out to do some of the more fun and creative stuff.

Erin: Well, as someone who can look at a layout for a house that’s going to be built or go and stand among the studs and the construction workers and not have a clue which room is the powder room, which room is the living room, I think that this has to be a really wonderful thing even for home buyers, quite apart from the commercial applications of this, just to help somebody like me recognize, okay, that’s where the master bedroom should definitely go.

Nikki: Yes, absolutely. There’s been fantastic 3D renderings and software to create 3D models of spaces that have been around for a while. The technology has always been there. It’s just been around adoption and just for there to be somewhat of an education around the developers, for example, on understanding why it is worth investing in these tools, but also a comfort level for our real estate agents and their clients to be able to look at digital models and to be able to read them.

We’re so used to, especially in residential real estate, for example, that you can go into a house or into a new development and I spent most of my career working in new developments off the plan. There was always this desire to go into a newly built building or a newly built apartment to get a sense of what it feels like, what it looks like to see the finished product, and that if you were looking at computer-generated images, that you couldn’t really get a sense because as people, we’re so tactile, we love being in spaces.

I think with the pandemic because we’ve gotten more used to doing things front of the computer that being able to watch a 3D tour or a video tour of a space, we’re starting to get more comfortable with understanding what it means or what it feels like and being able to interpret things in a video or in a digital way, and letting that at least be that first point of interaction.

I think even just over the past year, the changes that we’ve seen with 3D tours with more 3D models and that being widely adopted by residential real estate has been absolutely fantastic. I honestly think that it is going to continue on for quite a while because for customers there’s such a huge benefit in that being the first way to view a space before you get in your car or get on the subway and go over there.

Of course, also for the real estate agents to be able to get more qualified leads that understand the space, they’ve seen it before, and then you’re only taking somebody in for a walkthrough that already has a sense of, “Okay, this looks to be what I want.” There’s only a few factors that had really need to get a sense of. I think it’s really been a game-changer.

Erin: While we still have our virtual hard hats on here. Let’s stay with construction for a moment, Nikki, and I’ll ask you, are there new materials or processes that didn’t even exist 10 years ago?

Nikki: Yes, look, there’s technologies and processes that have been around but not adopted. One of the emerging areas that I’ve seen a lot bit of attention given to is around 3D printing. Now, 3D printing has actually been around for quite a long time and it’s been experimented within construction applications, but now what’s happened is that it’s been seen on some live projects around the world. That one’s getting a little bit of attention. Modular is getting a bit of attention, prefabrication, factory fabrication is getting some attention there as well. Now, again, these are technologies that have been around for a while, but the benefits and the cost-benefit of using them or the appetite for risk wasn’t quite there.

I think there’s certain things that we can definitely keep our eye on. Some of the processes have been changed around a little bit. I get quite excited about the number of companies that are now using drones to do building surveys and they can do site surveys so they can measure the site levels and they can actually also fly these drones around buildings looking for defects, seeing if they’re being built as per the drawings, being able to document these buildings in three dimensions all through an operator that’s sitting essentially with a joystick being able to do this. There’s incredible stuff that’s coming and I think it’s exciting that we are on this adoption curve to see where we might land up.

Erin: While you’re talking about 3D printing, just a little sideline here because I find it fascinating. What is the first thing comes to mind when you think of a construction site and something that has been 3D printed? What’s most common out there, Nikki?

Nikki: I’ve seen 3D printed buildings that have happened. Personally, I think that the buildings that I’ve seen, they’ve been single-family dwellings in low-cost situations. I’ve seen those popping up in little communities as test cases. Personally, I think in those applications, I don’t think that printing by a 3D printer is something that necessarily needed to happen. I think that those same dwellings could probably have been constructed at a lower cost, quite honestly, through traditional construction.

I think what’s more exciting though, is that you do see some 3D printing of different design objects and different ornaments, for example, because when it comes to 3D printing, it’s endless. As soon as you can create something in a CAD program or Rhino or whatever it might be, to be able to produce that straight away and let it come to life without having to think too much about the construction or the materiality of it is something that’s just can be rapidly prototyped and tested and come to life.

Erin: Oh, it’s fascinating and limitless really, which I hesitate to ask you this because everything has been growing so exponentially, Nikki, but what do you think is in store for the builders, planners and architects of tomorrow?

Nikki: That’s a good question. I think with building and construction, it is still a very traditional skill-based industry. Even with the advances that we’ve had with the internet age and with material science and everything else that’s come through, the way that we build hasn’t really changed all that much. It’s still very much manual process.

Also, because it’s often based on both skilled labor and also unskilled labor to an extent. There tends to be that cost trade off, which is something that’s looked at as an essential priority. I get excited about different processes that can be digitized or roboticized, I suppose you could say. One of the technologies that I heard about recently, it sounds so vanilla, but I think it’s absolutely brilliant is that again, it was a drone that could render and paint the outside of buildings.

The reason I find this quite interesting is that one of my next-door neighbours went through the exact same process these past couple of weeks. I just saw how the how the trades people had to put up scaffolding and then they had to come in and they had to do put the first layer of render, then they had to scrape it then two days later, come in and do the second layer and then they had to come in and do some painting.

They were there for about two weeks doing a very simple process and, of course, constructing and dismantling the scaffolding around and then the cost associated with that. To be able to just have a robot that can come in and is using its “laser beams” to be able to assess and measure the building surface and where there were defects and where it needs to go next to actually analyze it and essentially do so in a very robotic manner without being burdened by scaffolding or by gravity is something that I think is absolutely brilliant.

I think we’ll start probably seeing more chunks taken out of the building process that are very labor intensive or have safety concerns. In terms of the whole construction process, being completely overhauled is something that I think we’re not going to see for quite a few generations if at all.

Erin: There is no place like home and there have been incredible advances that Nikki looks at in a moment. Want the latest scoop from news and stats to trends and happenings in the industry? Well, make your way to CREACafe.ca, a cozy place for REALTORS® to connect on the latest info and industry developments. That’s CREACafe.ca. 

Now back to PropTech, entrepreneur and futurist, Nikki Greenberg on REAL TIME. Let’s bring it on home here for a little bit and talk about home ownership. What technologies, Nikki, have significantly impacted the way we interact with our homes?

Nikki: Look with technology in the home, it’s something that’s really evolved through the ages. Let’s not forget, electricity hasn’t actually been around all that long. There’s many people ordinarily live in New York. The building that I lived in for quite some time predates electricity. You have to remember that even that it was an advancement. Of course, then we’re coming into having the internet. The changes that we have in the home haven’t been all that significant even though the opportunities are there. There’s some people in the home, all of us we have appliances and we have TVs. We might have a clicker for our garage, if you’re in a detached dwelling. That’s all commonplace.

The next generation then it becomes okay, well what about automated blinds for an example or what if I can start to control my lights from my phone or voice command? The adoptions haven’t been that significant in our homes themselves, but there are few exceptions.

First exception obviously is with the cloud and all of that information being stored there, we’re now able to work from home, we’re now able to access everything from anywhere, our photos, no matter where we are in the house, for example, for us being able to, if we wanted to do everything from our phones. There is a whole generation of IOT, the internet of things, different appliances that you can control through your phone. Again, being able to control your stereo or control the lights or being able to change channel on the TV. You can do everything from your phone.

The next generation that we’re already moving into, is voice control. This is, again, increasing on the adoption curve. Anything from, I can’t say its name aloud or you’ll hear my phone responding on an apple device. Hey, S… These smart hubs that let us control our smart appliances by using voice such as asking for a timer to go on or a TV to go off, a light to go on or light to go off and so on and so forth.

This is very rudimentary in the way that most of us use it if at all and this is where it starts getting exciting, it’s when we start moving up that adoption curve and where the technology is heading. With voice command, and this is something that I find to be incredibly exciting is that the way it’s moving is that at the moment, it’s a little bit in our face. We know if there’s a Google home or something to that extent in the room, and we’re very self-conscious of it. We’re worried if it might be recording us or listening in on private conversations.

What’s going to start happening with a lot of this technology is that it’s just going to be omnipresent and it’s going to be part of our lives. You won’t be thinking when you walk into a room, you won’t be searching for light switch anymore. You’ll just know to give that command of turn on the lights. You won’t expect to interact with switches, you’ll expect to interact with technology in our most natural way, which is through a conversation. The technology is there and again, it’s about the adoption.

The next step after that is about our home starting to learn from us. Rather than me coming home every day at the same time, turning on the lights, my home will know that I tend to come home at a certain time and come in with the settings and the music and the scents or having dinner ready for me just intuitively. That butler service that you always wanted to have, that invisible helping hand that’s there for us. When that starts to happen, we start seeing this ease of use and this incredible level of dare I say, customer service, that’s being provided by the technology and that benefit, then there’s going to be a greater comfort in us.

As I mentioned, at the moment, there is a little bit of a fear factor around giving up some of the privacy to some of these devices and them listening in our conversations. When we start getting the benefits back, then we’re going to start living in a dare I say, a more seamless, integrated way with the technology that we talk to or the technology that’s just there for us in the background, just being part of our daily lives in our homes.

Erin: It seems to me that what we’re heading into now is far less passive than what we’ve been through before. We’ve all got the devices that we talk to and give us timers and the song and the time and the weather and all of that stuff that we want. Now, if you want things that are going to bring the lights on or do the things that these devices can also do, you have to go out to your local high-tech store and buy the parts and learn how they operate.

Is that holding us back at all do you think, Nikki, because it’s like, I’m going to have to spend some money, I’m going to have to figure out how this works and it’s not just like suddenly having your home connected to the internet.

Nikki: I think yes and no. Yes because as you’ve described let’s use smart lights as an example, you do need to go out to the hardware store and you need to make some changes and learn to use your light in a different way. The reason I say no is that so much of this technology is designed to be incredibly user friendly and consumer friendly. If I just use the example of the light bulb, what’s happening now is that if you want to have a light that you can control from your phone, you’re not having to go there and buy a fixture to go into a ceiling, take out your existing fixture, put it in, rewire it, get the electrician in and lo and behold, you have a new setup.

All you’re doing is you’re going into just any store that has consumer goods and you can just buy a smart bulb and you just put it into existing fixtures. There’s an understanding about making it easy and working with what’s there already.

Now, what we tend to see a lot when we have technology improvements coming along and we see it on our phones, is that when something comes, then it’s already built in, you start using the features. An example is the health trackers on our phones. I never needed a pedometer, I’ve never wanted a pedometer, but there’s a pedometer on there now that I know it’s there, I actually do every day I go and I check how many steps I’ve done. Some of the stuff’s going to be increasingly commonplace and it’s just going to essentially slip into our lives.

Erin: That’s more of the passive that I’m talking about. That if it’s there we’ll go, yes, okay, maybe I’ll try this. Let’s talk about embracing and adopting PropTech. Do you think that the real estate industry truly has embraced PropTech, Nikki?

Nikki: I think it’s still early days and there’s a lot more that can and will be happening but real estate hasn’t changed that much. Buildings are buildings and the way that we use buildings hasn’t changed very much. If you look at photos from the 1920s, you’ll see people coming into office buildings in suits and ties and sitting down at desks. There might be the typists pool, meeting rooms, boss has his corner office, that hasn’t changed all that much until recently.

What’s happening is that even though the way that we live and the way that we work and the types of activities that we do, even though that is changing and becoming more technology first and the way that we shop is another example, the way that we order food, the way that we cook, the way that we work out, we can work out or using Pelotons or doing a yoga session with an instructor in San Diego, live and working out at home.

Now, the way that we live has changed much and we’ve been very accepting of our spaces very much being the same as they’ve always been but what’s happened now is especially with the lockdowns and people having to work remotely and our way of living being so fundamentally different, there is going to be a larger push from the consumers for the real estate industry to engage more with technology. It’s going to go from a nice to have add-on to something that’s being essential.

Erin: Nikki’s traveled and worked worldwide but how do countries compare when it comes to grabbing on to and implementing property technology? We’ll find out in a moment. 

We’re all looking for connection these days and I don’t just mean a great Wi-Fi signal when you’re working, but real heart connection. REALTORS® across Canada are committed to supporting the causes and charities closest to their hearts. Get inspired by incredible stories and follow REALTORS Care® on Facebook, Instagram and Twitter and by sharing your own using #realtorscare. Thank you for what you do for us all. Now back to our chat with architect, entrepreneur and real estate futurist, Nikki Greenberg.

You’ve lived and worked around the world. Right now, as we’ve said, we’re speaking to you in Sydney, Australia, you’ve been everywhere, you’ve lived in Manhattan and many more stamps on your passport, Nikki, how does adoption vary globally?

Nikki: It’s a good question. Look, I do believe that across geographies, there are differences some of them cultural differences. We know that Asia has always had a reputation for being very technology first — Japan, Korea, Hong Kong, Shanghai, there have been these cities that are just very techie by nature. The general population has just always had this great embrace of technology. Those countries tend to be the leaders.

Now, China is quite interesting. There’s a lot of technology that’s coming out of there as they become entrepreneurs and huge companies that are coming out from there. Hong Kong has always relied on technology to a huge extent but then when you look towards the other extreme such as Africa, I actually, I was born in and grew up in South Africa. I can definitely speak to their context as well. When you’re looking at developing countries where people are working very hard just to put food on the table and a roof on their heads but yet everybody has a mobile phone.

There’s a lot of what we refer to as leapfrog technology, where it’s technologies that may have been invented in developed countries, and then over time, as it becomes more accessible and less expensive, is then available to these emerging economies, that the adoption rate is incredibly high because the technology’s there to solve problems. At that end of the spectrum, there’s an expectation from consumers, again, just in line that the properties and the offering is in line with technology. Then in between, we have Europe, you have the US, and the technology, adoption in real estate is now increasing, increasing and increasing.

Now, having said that, of course, there’s certain personalities from different ages, different demographics, different locations, et cetera, that do tend to embrace technology earlier than others. There’s always been a product adoption cycle, and that’s still there but what we’re seeing now is that the comfort level around what technology is and as the technology evolves also to be easier to use, and a lower adoption curve.

We’ve now removed the barriers or some of the barriers or perceived barriers rather, to the adoption, which means that the use of it is broader and more commonplace. We’ll see that increasing and increasing across the globe, wherever there’s internet and there’s greater internet at greater speeds being offered to more and more people everywhere.

Erin: What do you see as technological and socio-economic trends that are forming today, Nikki, that are going to impact our living and working spaces over say, the next decade?

Nikki: This one trend that I love to talk about, and it just summarizes a lot in a very simple statistic. What we’re finding is that by 2030, 75% of the workforce will consist of millennials and Gen-Z. What you’re seeing here is that it’s a group of people that really embrace technology and expect technology to be part of the way that they live and that they work and are uncompromising.

They expect that the physical in-person experience and the digital experience will work together. What we’re really going to see and what we need to realize is that, as we’re looking at workplace as an example is that we need to be designing for them, we can’t be designing for generations gone past or ways of working gone past because that has fundamentally changed.

My advice to anybody that’s in commercial real estate, for an example, is to if you have kids or if you have grandkids or friends or whoever it might be that all between the ages of 9 and 25, just get a sense of what matters to them and get a sense of how they’re using technology and what attributes are they looking at in places? You might find, for example, that they sit on the sofa and that’s where they do their work. I’ve definitely seen that if you’re doing homework with a friend, that even if the friend’s in the same room, that they’re still communicating with them through their computers, which is just something that comes naturally to them.

Definitely keep an eye on what they’re doing and how they’re thinking about technology and also some of the attributes. Another status power that I also like to throw in and trying to think about is that within the group of Generation Z, I believe the statistic is that 46% of them plan to become entrepreneurs and 57% of them, if I’m not mistaken, plan to invent something that will change the world. This is really who we need to be thinking about as our future customers and also our future workforce that is going to be changing the way that our spaces operate.

Erin: That is fascinating. When we think of the younger generations like Gen-Z and millennials, we think of more eco-conscious, are we becoming so as homeowners and buyers that you’ve seen, Nikki?

Nikki: I’d like to think so. We’re definitely seeing in consumer goods that there’s more that appeals to the eco-conscious and sometimes it falls into the category of greenwashing, that it’s presented as being better for the environment, but isn’t necessarily such. It’s a tricky one because by nature, a lot of us do care about the environment and say that we care about the environment. However, the sad thing is that on the flip side, and I’ve definitely seen this through my career is that consumers aren’t necessarily willing to pay more for a greener solution, which becomes one of those tricky obstacles to get around.

One of the exceptions is again, coming back to Generation Z, and they are these like eco-conscious climate warriors, we saw them definitely with the climate protests is that they see global warming as something that is very real and something that is affecting them directly because the consequences are happening within their lifetime.

For them, you’ll find a lot of them will actually come and they will ask about the sourcing of materials, they will ask where the electricity is coming through. They will actually look at the origins of certain things. They do want to have vegetable patches and sustainable materials and it’s something that’s not a passing fad, but something that is really important to them and their livelihoods.

In terms of attracting and appealing to Generation Z renters and buyers, this is something that does interest them, does appeal to them, but they’re also pretty savvy and they understand when something is just being used as a marketing ploy or when it’s something that really is ingrained and is something that is of benefit to the environment.

Erin: Savvy, is the key word there. How about life in dense urban cities where smaller homes are more affordable? Are you seeing people using PropTech to live simpler or with less? The Marie Kondo idea has been around now for probably, I guess about five years, is PropTech in line with that idea of minimalism?

Nikki: Absolutely. There’s a few different ways that it’s been done and where there have been benefits that I’ve seen. One of them that I absolutely love and it’s basically is the shared economy and the idea of as a service, you don’t need to own, you can share. Obvious examples of this being, we all know Uber, you don’t need to own a car, you can just call an Uber to get around. There’s basically and especially in New York, there’s a service for everything.

As I described earlier in my apartment, I don’t have a washing machine, so I send my laundry out, somebody else does it for me. There’s rent the runway, I don’t need to keep buying beautiful outfits, I can loan an outfit. There’s solutions where I can actually store my winter clothes somewhere else and then on my app, I can order my clothes back into my apartment when I need to change between my summer and winter gear, for example.

There’s on-demand cleaning services, there’s on-demand pet walkers, there’s on-demand toolboxes so that you don’t need to own your own tool collection for something that you only use maybe once or twice a year. There’s on-demand everything, so very much this getting away from needing to own things and instead being able to share and just pay for things as a service and as you need it.

One of the other things that I quite like is going essentially to another extreme is that there’s been a resurgence of robotic interiors that let you reconfigure spaces such as having a bed fall down from the ceiling and it’s stored up in the ceiling during the day so that you have more usable space during the day or being able to slide wardrobes backwards and forwards to change the configuration of a space in a small setup.

There’s a lot of different things that are coming or rather they’re already here, but the adoption is increasing or what it means is that we can own less, have more space, be able to be more mobile. If you’re renting and you’re moving fairly often to be able to come into furnished apartments, for example, or there’s services that you can hire furniture packages that are pre-styled instead of going out of buying every single item. There’s this wonderful rise of there being a service for everything and whatever your heart desires, there’s a technology that’s there to just make your life simpler.

Erin: Of course, commercial properties have kept up with this evolution too, haven’t they?

Nikki: Oh, yes absolutely. Co-working spaces or flexible offices being a prime example, tenants apps, where you can order every single amenity, ghost kitchens where you can have food being delivered up to your office from restaurants that don’t even exist, everything just done on the click of an app. Now that’s really where things are heading is app first, own less.

Erin: Did you catch that? App first, own less. Back to Nikki in a moment about repurposing buildings, mall meet school and more. 

Speaking of apps, we are so excited to share with you that Canada’s number one real estate platform, REALTOR.ca now has a new app, Rebuilt From the Ground Up and designed to reflect the needs of today’s home buyers. The app helps REALTORS® get connected to more potential clients. Download it on the app store or get it on Google Play. 

Back to, Nikki Greenberg, now. She’s been incredibly enlightening as a real estate futurist, entrepreneur and architect. Here’s the rest of our talk. Are there opportunities to repurpose these spaces beyond traditional work environments?

Nikki: Yes. This is something that’s been discussed at length in New York especially. With the pandemic that’s been happening, the occupancy in Manhattan has really dropped. The statistic that I heard is that the peak of 2020 saw office occupancy sitting at around 15%, which is very concerning for great industry. There’s been talk about for office buildings that haven’t been developed having a change of use to residential. There’s a housing shortage in Manhattan, so that being an option. There’s been talk around repurposing offices to again, residential or to logistics centers.

It extends beyond offices as well. I’ve recently heard about some shopping malls that were being repurposed as schools, which I thought was actually quite a nice idea because you still have a public space for the community to gather and in a shared space and also some of them being repurposed to as logistic centers for e-commerce.

There’s discussion around repurposing and changing spaces for use. I’m absolutely a big believer in it. It’s easier said than done. There are zoning requirements, there are building codes, you do have fixed infrastructure and mechanical workings, piping, et cetera that’s not that simple to move, but there is opportunity, I think by just putting on a bit of a creative lens and having a sense of simple supply and demand.

If you have falling demand for something, but you have a rise in demand for something else, then wouldn’t you want to shift over to the area that’s in higher demand if it’s at all possible?

Erin: Your vision and your excitement and your enthusiasm for everything PropTech is really contagious. I’d like if you could, Nikki, offer any advice to REALTORS® to help them better understand new PropTech trends.

Nikki: I will say that it’s a journey. Technology and especially PropTech, it’s new to everybody. None of us were born knowing about PropTech. It’s only something that’s emerged in the past few years and it’s changing constantly. If you’re coming into it fresh and this is very new to you, don’t worry, we’ve all had to learn. Right at the start I said when it comes to PropTech, we’re really talking about these three communities or real estate, investors and technology coming together.

Now, the technology crowd didn’t know anything about real estate either when they came in. It’s learning process. I think the first thing is realize, if this is new to you and you don’t quite get it, you’re not alone. It’s been the exact same thing for everyone.

The second thing I’d suggest is go out there, look on Google, subscribe to different newsletters. You can always go onto my website, nikkigreenberg.com, keeping it very simple, I have some fun ideas there. There’s great conferences that happen, there’s a lot of webinars and just start getting a sense of what’s out there and what’s the conversation that’s happening? Very soon, you’ll start to notice some of the patterns and the trends that emerge. You’ll start being able to piece together an understanding of the ecosystem.

If you do have particular needs that you’re trying to solve and you know what they are, go on to Google, see who’s providing those solutions and hop on the phone or organize a meeting with some of the technology providers. The sales reps, they’re fantastic, they’re very happy, a lot of them, to give up their time and expertise to really explain not just their own technology but why the technology is needed and the benefits to you.

They’re there as a resource, they’re very interested in adoption of their products and a lot of them, they’re very patient because they do have the enthusiasm to get their products being used. They also do have an understanding that there is a learning curve for the users of their products as well. Use them as a resource and just be okay with taking a risk. Try something out. You might find, for example, if you’re using a technology in your office operations, if there’s something that you want to try, test it, see if it works.

A lot of the technology that’s out there, they’re done on subscription models, which means that you’re paying month to month, so you’re paying a small amount every month instead of investing tens of thousand dollars in setting something up and then being locked into it.

In summary, it’s new to everyone, don’t be scared of it, start educating yourself, familiarize yourself with some of the products and be okay speaking to the sales reps to help them bring you on this journey. Then finally, just be okay testing stuff. That’s the way that you learn. If it’s not the right thing for you, try something else. It’s not a one size fits all. It’s a process and the technology keeps changing and it keeps getting better. It’s designed more and more to be more user-friendly and easy for both you and for your customers.

Erin: Oh, thank goodness. I’m glad to hear that. Just a tip or two, if you have them, Nikki, on how REALTORS® can educate their clients on what to expect.

Nikki: I think what I’d say is my top tip would be to let them know that the technologies that are coming out are designed to be user-friendly and to be useful. I like to use the example of the butler that’s there in the background just attending to every need.

Secondly, again is just letting them know that sometimes there is a learning curve and that even if something is a little bit clunky at the most because it’s an emerging technology, it will get better in time, but it’s fun to just test something out and learn from it. It’s all a growth process. The beautiful thing about the technologies coming out now is that you’re not necessarily locked into it. You don’t have to put in a whole new light fixture to get a smart light, you can put in a light bulb. You can have a subscription service to a software instead of buying a whole enterprise package. There is flexibility to just try things out and let your customers know that it’s just better to just start dabbling and learning. It’s exciting too, to get a sense of where the technology is, where it’s headed and how it can be helpful to us.

Erin: You have been amazing because coming into this, PropTech, I thought were some kind of EDM, Electronic Dance Music or something. This has been absolutely fascinating and it’s opened all kinds of doors and windows to opportunity to just look and see what’s next and give it a try, be like a toddler with an iPhone and push all the buttons and see what happens. We did and we reached Sydney, Australia. Look at that, but before we let you go, you’ve done all this looking into the future, Nikki, we’re going to ask you to take one look ahead a little bit and think how you would like to describe 2021 when all is said and done.

Nikki: That’s a good question. I think when all is said and done because our world has been so fundamentally disrupted by the pandemic, we have an opportunity right now to build back better. I think 2020 was about dismantling and 2021 is about repairing in a better way. I just hope that we, as an industry, do seize upon this opportunity because it’s a once-in-a-lifetime chance to do things in a better way.

Erin: That is a great metaphor for all of us in all ways, the dismantling and the rebuilding. What did you want your life to be? Because here you’ve got a chance to start again from the ground up. Nikki, thank you so much. This has been wonderful, and we are so grateful to you for taking the time and sharing your wisdom with us here today on REAL TIME.

Nikki: Thank you so much for having me as a guest. I love talking about technology and I hope that your listeners and yourself will have found my insights useful and that you’ll just go out and buy some smart bulbs and just start dabbling in your time off. It’s a lot of fun, there’s so much we can do and it’s been an absolute delight joining you. Thank you so much for having me as a guest.

Erin: Thank you to Nikki Greenberg and to you for making time for REAL TIME. Join us on Episode 16, when we’ll talk about the psychology of real estate with Dr. Winnie Shen. She’s got a lot of great information and ideas to implement in your work and home lives.

CREA REAL TIME podcast is produced by Rob Whitehead and Real Family Productions and Alphabet® Creative. We invite you to our previous episodes. Thanks for sharing these REAL TIME podcasts with your coworkers, your friends and fellow REALTORS®. I’m Erin Davis.