On today’s episode of the Byron Lazine Podcast, I sit down with Greg Schwartz – former Zillow exec and founder of Tomo – to talk about entrepreneurial mindset, Tomo Lock & Shop, and what the shifting market means for the industry and for consumers.
Before Tomo
Like many entrepreneurs, Greg Schwartz has ADHD, which drives him to constantly be in learning mode.
He was running a bunch of digital businesses at CNN when Rich Barton rang him up and asked him to take an 80% paycut, commute from New York to Seattle twice a month, and figure out the business model for Zillow. Greg initially said no but ended up wooing himself into signing on.
We all know how Zillow turned out.
What the shifting market means for the industry
Moving onto the topic of today’s market, the shift has consumers and agents worried. Buyers worry that the value of their homes will go down. Agents worry that growing buyer hesitancy will further dampen demand.
Housing and economy is about demographics at the end of the day. We’ve got a bunch of millennials and a lot of Zs coming into the housing market wanting to buy their first home…. The demand is there, people still need homes, sales are still happening… Will some businesses suffer? Yes. Will some businesses take market share and grow right now? Of course. As it has always been.
Company culture and present leadership
Greg described Tomo’s leadership training (not management training) and the weekly hybrid schedule. We talked about his redefinition of GOAT as the “greatest of all teams” and what that means
People come here because they want to be part of something larger than themselves. They want to take on really big challenges. And the only way for that to be fulfilling is if you look right and you look left, and the people on your team are some of the very best you’ve ever worked with in your life. That’s where it’s fun to come to work! And that’s what GOAT is all about.
Impact of mortgage rates on monthly payments
When it comes to the conversations agents need to be having with their clients, Greg stressed the importance of focusing on monthly cost rather than on the rising mortgage rate.
Our rule of thumb is, on an average mortgage – let’s say $350-375K – every percentage point increase in rate is about $200 of cost a month… it makes the topic much more approachable for home buyers if we talk about it in monthly impact.
That led to a question that confronts a lot of agents right now with the rising cost of home ownership: Is it still better to buy than to rent? If you go to Redfin Data Center and scrosll down to the bottom, their chart, “Redfin Monthly Rental Market Data” shows the average rent is still substantially more than the average mortgage.
And they’re not even talking about the future appreciation benefit, the tax benefits, the paying down debt and earning equity benefits, they’re just talking monthly basis – average monthly payment.
Tomo Lock & Shop
Tomo developed Lock & Shop because buyers are worried their buying power will reduce while they’re home-shopping and they won’t be able to afford the house they want.
We’re hearing that, so we went to the whiteboard and said, ‘How could we structure some level of rate insurance effectively, which is what “Lock and Shop” is… You can come to us without a property address, which is reasonably unique… You can do a 120-day lock without a property address… and then you have 120 days to shop for a home.
Tom Ferry Life Hacks
With the Tom Ferry Success Summit just around the corner, you know I had to wrap up with this question for Greg:
If you were to give your Tom Ferry life hack, is that a routine for you? What’s your hack that gives you all this energy to be so creative, to be such a great leader, to be in your business all the time? What is it that drives you to do that?
Greg’s number one life hack: join a cause that’s bigger than just earning a paycheck.
Number two:
Your time is all you have… I don’t do to-do lists. To-do lists are a noose around our necks, in many ways… It’s gotta be on your calendar or it’s just gonna sit on that list as a burden to you
To stay on top of current events and hot takes, he’s using Twitter as his news source. And then the New York Post. “Because it’s fun.”
Other hacks:
- Never violate your critical sleep window
- Make time for daily exercise
- Hand-write your priorities every single morning for the day
- Set aside at least an hour for yourself
Watch the full episode for more.
Sisu increases brokerage & team annual volume by 107% and agent annual volume by 28%.
