Century 21 – Judge Fite Company is the 4th largest C21 Brokerage in the World. Based in the Dallas-Fort Worth market, CEO Jim Fite has carried on his fathers legacy (as has his very capable sister, Jan) for decades. Riding the ups and downs, out maneuvering the competition, and always focused on their agents and customers. It’s a story you don’t want to miss!
Mike: Welcome to the FlipNerd.com podcast. This is your host Mike Hambright and on this show I will introduce you to VIPs in the Real Estate Investment industry as well as other interesting entrepreneurs whose stories and experiences can help you take your business to the next level. We have three new shows each week which are available in the iTunes store or by visiting FlipNerd.com. So without further ado, let’s get started.
Welcome to today’s FlipNerd VIP show. Today I’m joined by an industry veteran in the realtors and brokers base Jim Fite of Century 21. Before we get started on today’s show I like to take a moment and recognize our sponsors.
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So Jim welcome to the show.
Jim: Thank you, Mike. Glad to be here.
Mike: How are you today?
Jim: I’m doing terrific.
Mike: Great. Okay we’re just getting started in the new year here and I’m sure you’re probably like me you’ve spent some time planning for the year to come and have a lot of bodacious goals set and working with folks on your team to set goals and things like that so I expect that you are anticipating that 2014 is going to be a better year than 2013.
Jim: Yes absolutely and we weren’t unhappy with 2013.
Mike: Yeah it was a good year. Well Jim I know you well, we’ve obviously done some work together here in the Dallas-Fort Worth market but some of my guests may not know you. Can you take a little bit of time and introduce yourself?
Jim: Sure. Well I’m Jim Fite, I’m President and CEO of Century 21 Judge Fite Company here in the Dallas Fort Worth metroplex. We have 20 offices over 500 sales professionals. We are not only involved in the residential real estate business we’re involved in commercial relocation, and many other aspects insurance, mortgage, you name part of the real estate business that involves a transaction and we’re involved in it in some shape, form, or fashion.
Mike: Right, right. And I know your company has a long legacy of family business. Can you tell us a little bit about how Judge Fite got started and then how things have progressed over the decades I should say?
Jim: Sure you bet. Well my father, Judge B. Fite founded our company in 1937 so we are 77 years old as of this year, and we’re very proud of that fact. We’re a second generation owned and operated with third generation coming on strong. Both with two of our children involved in leadership positions in our company and so on top of that we have about 22 people on our management team. Back in 1997 we joined the Century 21 system which really took our company to new heights. We were four offices and about 100 people back in ’97, today like I said we’re 20 offices and certainly one of the leaders in the market place in DFW.
Mike: Great. And so how many agents do you have under your umbrella.
Jim: We have over 500 currently.
Mike: That’s awesome. And how many transactions did you do say last year in 2013?
Jim: Our numbers were just in. We did 5700 plus transactions last year.
Mike: That’s awesome. Wow. And how does that compare with other Century 21 large brokers in Texas or nationally? How do you compare?
Jim: Appreciate you asking that. We are the number one Century 21 in Texas in the five state region, probably larger than that actually. We’re the number four Century 21 in closed units in the world.
Mike: Wow. That’s awesome.
Jim: Yeah we’ve built quite an organization through a lot of hard work and great people.
Mike: Yeah. Well I wanted to pick your brain a little bit and talk about I guess, from a macro environment standpoint, what do you think is going to happen in 2014 in the real estate market?
Jim: Well we’re betting, literally we bet everyday in the real estate business, that we’re going to continue to see an upswing in sales. Demand in Dallas Fort Worth is certainly higher, continues to be higher with the recession of five years just built up a pent up demand. It’s incredible. Our job market is phenomenal here in Dallas-Fort Worth with our recent announcement of the USAir and American Airlines merger taking place. That should add some thousand people in 2014 moving in from the Phoenix area just alone, for that merger. So there’s a lot of relocation activity going on. A lot of opportunities. High demand inventory is down significantly continues to decrease and I think will continue to decrease as we see our market robust.
Mike: And your company specifically you have a team or a focus on corporate relocations is that right?
Jim: Oh absolutely. We’ve been doing relocation business since 1986. It’s a very large part of our business in 2012 it accounted for 15% of our business. I believe we’re up in 2013. I don’t have those exact number in yet. I’ll have them in the end of the month so we’re still collecting our 2012 numbers but I would image we’re going to be close to 20% of our business last year.
Mike: Wow, and how does that part of the business work? Is it building relationships with companies and then having employees that they move around or does it come from kind of the bottom up or, I’m sure a little bit of both but?
Jim: Well you know, it’s a game. Let’s start there. You have to be willing to play the game. It’s very expensive business. You have to invest not only internally in the right staff, which by the way they’re very unique people. They do a unique job and service for the client and so you have to invest in the staff that you have controlling that business.
Well last year we heard we received over 3,000 referrals into our company. We will be announcing in February a very large success of 2013 of a platinum status with a Cartus relocation network. What that means is we’re expecting over 4,000 to 5,000 referrals in 2014 so huge growth. In order to manage that growth you have to have the right people. You have to have people that are professionals in their industry and coordinating those people moving in and moving out.
And you have to have the right contacts. I left that out. You have to have a relationship like with Cartus with USAA with American Airlines Credit Union, with American Airlines Advantage Miles, I mean all of those are very large accounts for us but we have many, many more that are other minor accounts but certainly just as important.
Mike: Yeah. And Jim, you talk about your team a lot and I know that you are a tremendous leader from everything that I know about you. I know that in the real estate space challenges there just tends to be a lot of turnover in transient and people that just try out the real estate agent business and it maybe does or doesn’t work. Can you talk a little bit about how you are able to maintain a solid team and kind of how you deal with the fact that tends to be a revolving door certainly for a lot brokerages I know it is? I know that again you’re very much family focused and kind of long term focused. Can you talk a little bit about how you do that differently than other brokerages?
Jim: Well I think it starts with company culture. We built company culture many, many, many years ago and have fought to keep that culture alive. Family you’ve mentioned a couple of times is very important to our organization and certainly is was easier when we had one office and eight people. Today we have a lot more than that.
But we still keep that culture alive and I always say that cornerstone of our company was my mother and father. Strong integrity, strong ethics, strong belief in training and developing of people, and so that cornerstone I think just carries out through the entire company.
Addition to that is our foundation. We believe in strategic planning. We start our strategic planning process for the future, not only the following year but the future in August by surveying our entire company. We have a three day planning advance, we don’t call it a retreat we’re moving forward not backward. And so our management team escapes for three days in October and literally at this Thursday’s management meeting we will finalize our strategic plan for 2014. We got about 98% of it done. We got a couple of things we’re going to touch on Thursday, and all that means is that we communicate back to our people what we’re doing.
We have seven major initiatives for 2014, which has already been communicated to our folks and it relates to their personal development as well as their professional development as well as the companies development and how it relates to their personal business. That is not something that is easy to accomplish. Nor is it something that should be taking lightly from the value to the agent.
With all that said the foundation of strategic planning in the world of trading, technology, marketing, all of the operations making sure everybody gets their check on time, making sure our clients satisfaction is the highest level possible. Last year we ran a 96% quality service rating for all of our clients. We surveyed every single client that we have. All of it ties to the culture of the organization which is family, bringing it together.
Mike: Sure that’s awesome. And it’s got to be tough to compete in the day of, it will be interesting to see what you say, my guess is that more agents or prospective agents and more people given the changes in technology think that they can do this themselves without one of the larger bigger name brokers and I know that there’s personally because I’m part of a franchise system I understand the value of a brand and systems and all those things. Where a lot of folks are kind of condition to think, “Well I can just go do it on my own because I know somebody else that did it.”
But how does the fact that prospective buyers and sellers do more research online, how do you compete in an era and where do you see things going with kind of the marketplace in terms of people being able to find deals on their own or find houses on their own? Of course they still have to go through an agent to transact but that’s have to had made a tremendous impact on the kind of realtor and broker industry over the past several years and I assume that’s a trend that will continue.
Jim: You know you asked three questions.
Mike: That was a long question.
Jim: That’s okay. I’ll try to take them one at a time if I can remember all of them. The first one was the real estate agent who maybe had a somewhat of a success in their sales activity and now they think because of the Internet and having access to having access they can go out and open their office in their home or their backseat of their car whatever it may be. Let me tell you Mike, that is nothing new, there’s this problem today.
Back when I started in real estate 1972 we had a company right next door to our company that was the same type of company and I’ll just leave it at that. They weren’t a large firm. They thought they could do it and they thought they could do it at a better price than we could do it. And the fact is they were out of business before long.
They found out in order to compete you have to have certain basic essentials in for the long term. You might be there for a while. I’m not saying that. Maybe you can have a niche you can find but on the other hand in order to really give outstanding service which the public is demanding more. You talked about their education a minute ago. The fact is their demanding more of real estate agents than ever before.
So how do we compete? Well the fact is that we compete through what I just said. Training, technology, the whole package, being able to depend. How about leadership? How about getting people the opportunity to succeed? The tools, the systems that are out there today are phenomenal and there are more of them than anybody can keep track of. We try to weave through all of that and bring it down into the real estate professional and how can they make money, serve the customer and really accomplish their individual goals?
As an example this year we’re introducing The Dave Ramsey Financial Wellness course to all of our people. Not only are we introducing it, we’re teaching it inside of our company, and we have a pay back program if the complete the program because we believe in order for them to be successful they need to get their personal house in order. How many companies are doing that throughout the United States in the real estate field? None. Nobody’s doing that. But that’s an initiative we have done because we care about our people. It separates us from the pack. And our people realize it and accept it and appreciate it. That’s what they’re telling us anyway.
Jim: And they tell us that by staying with us. That’s the other side, our factor is phenomenal. I’ll put it up against anybody in the industry. Now you ask about consumers having access to data? Certainly. Especially when you’ve been in real estate 41 years like me you know I’ve been around the block a few times and certainly when the Internet came on we thought that we would be history, we would be dinosaurs and we were trying to figure out our place.
The fact is the more information the consumer had the more confused they get. And the more they need a realtor. Before the Internet consumers looked at the morning news or the local magazine which are almost obsolete today in real estate marketing. But they’re looking at the publications and what were they doing? They were circling ads. They were calling up realtors and they were calling up for sale by owners or whomever. And the fact is they were confused until someone got a hold of them, helped them walk through the clutter and get to it.
What we have today is a more confused consumer. They’re going out looking at literally thousands and tens of thousands of homes on the Internet. They’re flying by them in seconds but one of them catches your eye and then all of a sudden they want more information. And then all of a sudden they make an appointment with somebody and until they find somebody, usually through a referral still to this day, a personal referral to a professional realtor, they get confused. Then that realtor kind of walks them through the clutter, helps them with need determination, find out what their needs are, and zero on in. And that by the way has to do with a buyer and seller of their first home to someone who’s buying their 20th home. Our relocation customers I’ll guarantee you they don’t do it on their own.
Jim: They want us to help them. Well they’re professional home buyers. They bought two, five, seven, ten, 15, 20 houses throughout the US. They’re calling us saying help. We’ll be up there Monday morning at 9:00 pick us up at the hotel and we got two days to buy a house. We need you. Well how about that person compared to the first time home buyer? They need more.
Mike: No doubt.
Jim: So the confusion part of it is actually increased the use of realtors interestingly enough. The last I’ve heard been several years ago that the consumer uses realtors 7% more today than prior to the Internet.
Mike: That’s interesting.
Jim: Yeah. Very interesting.
Mike: So I would assume based on that statistic that you and your company actually embrace technology?
Mike: I know you do from your operations but things like the Zillows of the world that are really kind of doing a paradigm shift. I mean they provide a lot of information but in turn it sounds like folks then need agents to go help then execute anything.
Jim: Certainly. Yeah we market our homes, when you list a home with our company, we put it out to over 800 websites. I mean so we put it out there wherever we can get it that’s reasonable and we can afford, and they’re not trying to shaft our company, which some of the aggregators attempt to do and it will be interesting is that develops how that works in the future.
But in our company we’ve done something a little different too. You know we don’t have Internet leads going directly to our agents anymore. August of 2012 we started a call center in our organization where every Internet lead goes directly to live people 90 hours a week from 8:30 to 9:00 PM Monday through Saturday and from 10:00 to 9:00 PM on Sunday and we’re contacting those consumers and people interested in buying a home immediately with a live person.
We have let me see, over 20,000 leads were captured last year and we made over 2,000 direct appointments within minutes. Within minutes of those leads coming in. And then that turned into a face to face appointment with one of our real estate professionals.
Mike: Okay so your call center, this is interesting because there are some things I’m dealing with in the same space.
Jim: Sure you bet.
Mike: Because we’ve seen statistics that say, specifically in Internet lead, I mean the challenge with Internet leads from your standpoint and mine as a real estate investor and for somebody that mentors a large group of other investors is we’ve seen statistics that say that an Internet lead loses tremendous value literally in the first five to ten minutes if you don’t contact them. And I think it’s just the tendency of by the time people feel comfortable filling out a form online they’re likely filling out several forms, “Well while I’m here why don’t I just fill out another one,” and so you got all that competition that could be coming in. Some of which we’ll never even call them which is crazy but it’s just a reality.
So when you have your call center they basically are scheduling your agents to go out on these appointments?
Jim: Exactly. The call comes in. We have invested in technology where within oh maybe less than 30 seconds, so when somebody hits send on their computer saying I want more information that lead immediately goes to our call center within 30 seconds or so, first of all our listing agent gets the first shot at it without the call center. They have 15 minutes. 15 minutes and 30 seconds later it goes to our call center if the listing agent doesn’t respond immediately.
So anyway when the call center gets it again 90 hours a week, that call center picks up the phone if we have a phone number and calls that customer directly. They make an appointment when possible with that consumer whether it’s at the property or it’s at our office and then we have a team, we call it the I Team where those leads are sent to and we have a system for that as well via zip code. We have an algorithm of systems within that I Team system and so the lead is turned into an appointment. The appointment is then made for our agent.
Our agent I’m sorry we call it the Jan Miller Team, The Jan Miller Team who is my sister and partner in the business, The Jan Miller Team then sends out a text to all people that are qualified on the I Team in the zip code. The first one to answer the text, I’ll take that appointment Tuesday at 2:00 1202 Belt Line Road they get the appointment, they take that customer from then forward.
Mike: That’s awesome.
Jim: It is awesome. We’re really proud of it and its working by the way. It’s a much better service to the consumer, much better service to our homeowners, and much service to our real estate professionals.
Mike: Sure. So what do you think from a macro environment standpoint across the US, I know you primarily focus on the North Texas region but what do you think is happening kind of nationwide? A lot of folks that watch my show will be outside of Texas, so can you get out your crystal ball and tell us what you think is going to happen with I guess the market as a whole? I know it varies substantially by neighborhood but also with rates and things like that, where do you see things going?
Jim: Let’s start with just general unit sales and where that’s going and you know? All predictions that I’ve read from NAR from Fannie Mae etcetera everybody’s looking for a robust year. Maybe not as big as 2013, maybe there’s going to be but I don’t know if that’s really what they’re predicting or whether that’s conservative nature.
So we’re looking at a higher unit number, certainly REO’s are down and will continue to go down. The real estate professionals that we’re in that space are scrambling to figure out, “Oh my gosh what do I do now?”
The real estate investors y’all are competing with now Wall Street. A lot of Wall Street investors are in the marketplaces doing some pretty interesting things, we’ll see how that turns out. I question whether that’s a long term thing or whether it’s a flash in the pants kind of thing. We certainly in our company are representing a number of them. And to different levels of success, I’ll just put it that way.
Unit sales are up. Interest rates, you know I would like to think they’re going to stay low. With the economic conditions as we see Wall Street doing well we may see interest rates creep up. Will we see seven or eight or nine percent interest? I don’t think so. Not for a long time if I ever again. I hope never again having lived through those days of 17% interest which was long before you were born Mike.
On the other hand, you know, yeah I think we’re going to see bumps. I think we’re going to see some small rises in interest rate and it will be interesting to see if that slows the housing economy or whether there’s enough demand to really absorb it. I would like to think that the demand at least in Dallas-Fort Worth is there to absorb small bumps in interest rates.
Mike: Well this is obviously probably the most resilient market in the country.
Jim: We are blessed.
Mike: But there’s a lot of great markets out there. You talked a little bit about how you served real estate investors and how you work with investors and giving your size and your name and your recognition across the country, I’m sure you have a lot of bigger clients. Can you talk about how you deal with or how you work with different real estate investors? Whether it’s individual real estate investors that are maybe looking to get started or do smaller volume, all the way up to you know institutional type folks. Can you talk a little bit about how you serve the investor community?
Jim: Sure you bet. Well let’s start with serving our real estate professionals because if they don’t understand the investment decision then how can they help you? How can they help the real estate investor? So as an example this year we already have in our books four separate training classes for our real estate professionals and/or people that want to buy investment property to come in and attend our real estate investor classes. We got one in January, about every quarter is a way we schedule those out. They’re half day long in one of our real estate offices, regional offices. So first it’s educating our people.
Some agents do not want to work in that space and if they don’t want to work in that space they shouldn’t work in that space. It is not for everybody. You got to be a numbers person. You need to understand Excel as a foundation and then go from there. You have to be interested. So first is education of our folks.
Second then is bringing in the investors themselves. We get calls every day from small investors buying their first house or buying their tenth house. Many of our agents have been working with the same investors for years and years and years and years.
I think this past year personally I bought three houses I got one under contract and maybe another I’m working on right now waiting on them to see if they accepted my offer this week and so you know, we all have different levels of expertise and I work with one of our agents I might add that represents me. I don’t go out and find my own. She does the research for me and sends them to me and I go out and take a look at them and sometimes I don’t even do that. Sometimes I’ll say, Write it up. Let’s do it because she knows what I’m looking for.
So anyway, working with that investor from beginning to end you know? What are the basics? Are you looking to buy and flip? Are you looking to buy and hold? What are your short term goals? What are your long term goals? Because really that is what it is all about is a real estate investor has to know where they’re going.
I don’t know about you Mike, but I’ve found that people are looking for money. Certainly money can be there but you got to know what you’re going to do with that money to really motivate the individual. And if they know that you know my plan is to buy a new home, or my plan is to provide for my children’s education, or my plan is to build an organization like you built, whatever it may be what is the end game? How can we take baby steps to get there because I’m firmly believe that wealth is built? It is not something that is given. And it takes a day at a time. A week at a time. A month at a time. A year at a time. A decade at a time. And over a lifetime you can build wealth in this business in a big way.
Mike: Yeah no doubt about it. And I’m sure you see the same things that I do. This took a while for this to register, really it took from me moving to an investor myself to being a mentor and a coach for lots of other people across the country to really understand that. A lot of people get hung up on unit volume. I want to do units. I want to do a bunch of houses. I want to make a bunch of money. But you really have to kind of plan up because units do not equate bottom line profit necessarily.
So I’ve spent a lot of time, probably the biggest thing I did with my team is talk about goal planning, “Why are you doing this?” And when I hear people say, I want to buy houses like you do or high volume of houses then I usually say, “Are you sure you want to do that? Do you know what comes with a lifestyle of doing that many houses?” And I think about with a young son of course, when we think about lifestyle more than ever before and so it’s an important part of really understanding investors, like you said of understanding an investors goals of what are you trying to accomplish here. What do you really want to do before you just start scooping up units?
Jim: You know I bought my first house with the intent that that would be a down payment at least or maybe the whole education of my children. And that was 41 years ago. I still own that house I might add. I never sold it for the education. What I ended up doing is adding to it and of course I’m a buy and keep guy. I very rarely sell my property anymore I wish I hadn’t ever, but I’m a buy and keep guy, and now I’m buying for my grand children’s future. And it’s really exciting when I think about what I’m doing today. To know that my grandchildren will have an education or my children won’t have to take care of their father in his old age.
Jim: That I’ll be able to take care of myself and I won’t be a burden on my children or grandchildren and it’s interesting over that 41 year period how my individual goals have changed as a real estate investor. So I love what you’re talking about with your folks.
Mike: Well Jim one of the last things I wanted to ask you about is it’s interesting that you’ve bolted on so many other businesses from insurance to lending into certainly you need partnerships if you’re not doing it yourself and I’ve realized over the years that I’ve done this that this is a very natural industry to kind of bolt on other businesses and monetize in other ways and that’s obviously the sign of a true entrepreneur as well. You start a business and you start to see these opportunities that you know all boats will arise.
Can you talk a little bit about, tell us kind of in a high level some of the other businesses that you have but just talk about I guess that from a fundamental standpoint of looking out for opportunities that are kind of a natural fit to other things you’re doing?
Jim: Sure. You know if I think back an interesting question I hadn’t thought about it in a long time so you’re making me think a little bit. If I think back of why we have gotten involved in various businesses the core of that sounds trite maybe. But it’s really the service to the customer. You know the more that we can give from an internal perspective to our client, the better value my client has for the cost of my services. The better quality that we can give to the value of the client, then they believe that my services are worth the money. I mean it gets down to that.
So when you stay focused on the client, all a sudden things become crystal clear. For instance we have a connections vendor program. You go out to our website Century21JudgeFite.com and there’s a button there. You know? Vendor Program, and those people are people like I know you have that first of all they’re advertisers. We don’t get any money back if you hire them or our clients hire them or whatever. It’s purely they pay a monthly program whether they get one lead or a thousand leads it doesn’t matter to us.
And it’s an advertising program but the value to the customer is if they need a foundation report or they need foundation work done these people are real estate sales friendly. They understand the real estate consumer. Plus they’re part of our program, if they don’t do a good job we got a quality control on that so our customer can rest assured. We have a strike one, strike two, strike three policy with those vendors. If they don’t do a good job, certainly anybody can make a mistake, but if they make too many mistakes they’re out of the program because we need a quality control for our customer.
Insurance. You know how many times had we got our buyers to come to a closing, “Oh my gosh I forgot my insurance.” We handle that early and hot in the transaction. Some people use it. Some people are married to their insurance agent or whatever but the fact is that they have a second quote. The fact is that we are real estate transaction friendly. That we can get a quote and we can get that binder to the title company in minutes. We can provide that service to the client and to the agent. A very important piece of the puzzle.
Again the good news is we make a little money along the way if they use our insurance agency but the service we provide is huge compared to, “Oh my gosh I forgot.” Or if they did forget we can get that policy over there quickly. Critical, critical service.
And then we go on to our relocation business. Our property management you know we manage over 1,800 units. Single family and duplex and condo homes. No HOA’s. We don’t do any multi- family, no commercial very small if we do any, very little. So we’re in the house property management business in a big way. We have offices throughout the DFW area. We cover 11,000 square miles.
Well in a recession you can’t sell the houses so what do they do? They need to manage them. They need somebody in there to make a payment. So it’s a natural place for us to be and we’ve been through four recessions since I’ve been leading the company and every recession our property management company grows significantly which we did in this last one and we’re still growing even in the good times.
So you know these are all services that we look at the customer, what do they need and how can we fill that need? And then we try to build a business around that so we can give that customer service. I hope that doesn’t sound trite. I hope it sounds very real because it is very real.
Mike: Yeah very. Well Jim I appreciate you joining us on the show today.
Jim: You bet. Mike, good to see you and give Liz my best.
Mike: We’ll have to get together again sometime soon and I always appreciate the opportunity to talk to you. So thanks for joining us and thanks for all your information and insights. And I’m sure we’ll be talking again soon.
Jim: Look forward to it.
Mike: Okay, take care Jim.
Mike: Thanks for joining us on today’s FlipNerd.com podcast. To listen to more of our shows and hear from incredible guests, please access all of our podcasts in the iTunes store. You can also watch the video version of ours shows by visiting us at FlipNerd.com.