Colleen Barry, CEO, Gibson Sotheby’s International Realty

In an interview with Invest:, Colleen Barry, CEO of Gibson Sotheby’s International Realty, discussed how it has prepared for changes affecting the real estate industry, and what strategies and collaborative efforts are in place to tackle the complexities of Boston’s housing market. 

Reflecting on the past year, what have been the significant achievements for your company in the region?

In the last year, we have definitely seen the market start to come back. What is astonishing to me is how our agents have tended to outperform the marketplace. So far this year, we are averaging closing 50 homes a week. If you look at the historical numbers, that is astonishing in a market with reduced inventory. 

We have had some major challenges over the last couple of years. In addition to the volatility happening worldwide, we also saw a change in interest rates which created some consternation on behalf of buyers and sellers at the same time. In addition to the inventory restrictions, 2024 is an election year. Elections do not necessarily have an impact on the overall market numbers for the year, but they do impact cadence. These years tend to be front-loaded. We will likely continue to see great activity up until October followed by a brief pause as people wait to see what happens. No matter the outcome, things always resume. We are dealing with natural consumer behavior and I could not be prouder of our associates because those are difficult headwinds.

Our agents are also staying ahead of the curve amid the recent shift in our industry. There have been some class-action lawsuits against Multiple Listing Services, real estate companies, and the National Association of REALTORS® (NAR). The NAR-required changes to MLS rules and broker business practices go into effect on August 17th, 2024, and we have been hard at work preparing our agents for some adjustments to how we have been practicing real estate  in advance of that date. We have leaned into embracing transparency and consumer choice.Some real estate professionals have been in the business for 40 years, and you would think a shift would be a major challenge for them. But what I have found is that successful people who have been in the business for a long time are used to seeing obstacles and adapting and thriving in the new environment. 

What are some of the neighborhoods or regions that you see as having the most opportunity for growth right now?

Our firm has moved into two parts of the North Shore of Massachusetts thus far and we are looking at how much additional opportunity there is in that region. We have also seen some opportunities toward the South Shore and a bit in the MetroWest. It is always about finding the right opportunity for us to expand so we can better serve our clients. 

In many ways, we look at marketplaces as potential moves for growth but also always assess how they will fit into the collaborative culture of our brokerage. Is this the company, group, or team where it makes sense for us to be together? Do they retain clients and make an effort to maintain good relationships? Do the markets they serve feed into those we serve currently? How do they fit into the collaborative culture of our brokerage? If it does not fit that formula or criteria, then it is not worth pursuing. While we are able to cover a lot of territories from our existing locations, we are never pressed to make a growth move. What we do is look at the marketplaces where we have clients going to or coming from, or that our agents are already covering. We keep our relationships open and are committed to a culture of service where agents feel supported and able to thrive. 

Given the fluctuating inventory in Boston’s housing market and the higher interest rate landscape, how are you adapting your strategies to maintain growth?

There are lots of ways to address this. Sometimes it involves helping clients see opportunities in adjacent or similar markets. We call them overflow markets. For example, people may want to live in Cambridge, near Harvard Square, but when that becomes too difficult, they start looking at Watertown as an alternative. It’s about helping people understand where the next frontier is and where people are moving due to price or inventory challenges. That’s one strategy. Another is assisting them in finding financing opportunities that allow them to make purchases they thought were out of reach. We achieve this through strategic partnerships with mortgage agents and local community organizations offering first-time home buyer incentives.

We also have an agent working on co-ownership seminars, which helps people consider buying a home together. This is particularly helpful for single individuals who cannot afford a house on their own but can when combining resources with a friend. In essence, we act as guides, helping people find the resources and tools to achieve their goals, even if it means pursuing non-traditional paths.

Building in Boston is also challenging and expensive. Land acquisition, material, and labor costs are high, making it difficult to build at every price point. We need to encourage builders to come in and help with these challenges. With fewer people entering trades, the shortage of skilled tradespeople further exacerbates the problem and contributes to the overall inventory crunch, driving prices up. It is a complex issue that requires smart collaboration to solve.

What trends are you observing in the luxury real estate market, and how is your company adapting to meet these changing demands?

The luxury market moves differently. Interest rate volatility primarily impacts the entry to middle levels of the market, where buyers rely on conforming loans. In contrast, luxury buyers often pay cash or use non-conforming loans, so they are less affected by interest rate changes.

In terms of trends, there is a high demand for top-notch amenities in luxury properties, especially in downtown Boston. On-site parking, building services like doormen and concierges, and other shared services are critical. On Cape Cod, many buyers want furnished properties. The market dynamics vary significantly across segments with micro-markets forming as conditions change, especially from a loan standpoint. 

What are your expectations for the Boston real estate market in the next few years, and what are your top priorities for your company?

In the near term, our priority is to help our agents adapt to industry shifts and encourage sellers to list their properties, as low inventory drives up prices. For those with flexibility, it is an ideal time to sell. Looking ahead, we anticipate more inventory coming onto the market in waves, provided there are no major economic or political disruptions.

Unfortunately, we do not foresee a significant dip in pricing due to the persistent inventory shortage. For prices to drop, we would need a surge in property availability, which does not seem likely. We will continue monitoring the market and adapting our strategies to best serve our clients amid these challenges.