The Politics of Running A Realtor Association with Denver Realtor CEO Nobu Hata

Brokerage Insider

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Nobu Hata is a real estate lifer. He's sold, his wife runs a large team in Chicago, he's helped create YPN chapters of Realtor Associations, worked for NAR, and now runs the Denver Metro Association of Realtors (DMAR). Listen to what Nobu has to say about the politics of running an association. What he's doing to help Denver Realtors and the Denver housing shortage.

TRANSCRIPT

Hi, everybody. Welcome to Brokerage Insider the podcast where we interviewed the leaders in real estate and technology. I'm your host, Eric Stegemann and I'm the CEO of TRIBUS. We're one of the largest independent prop tech companies in real estate. And we're providers of custom real estate brokerage technology to medium and large brokerages in the United States.

And even throughout the world today on the show. We have Nobu Hata and Nobu is the CEO of the Denver Metro Association of Realtors. I've actually known Nobu for over 10 years now. And you know what Nobu liked me as a real estate lifer. He actually started in the real estate industry more than 20 years ago as an agent in Alaska, and then moved to sell real estate in Minneapolis, where he helped found the YPN chapter there.

After his time selling, Nobu moved to Chicago and he accepted a role at the National Association of Realtors. He was most recently the director of industry outreach and engagement strategy there at the same time, while in Chicago, Nobu's wife, Shea became a Realtor and built an incredibly successful team where she still sells Nobu has traveled all around the U S and even around the world to various speaking engagements.

And so we're very lucky to have him on the show today. So Nate Nobu thank you very much for joining us. Thanks for having me, Eric. I'm excited to dig in a, as a friend of mine and be in your new role as the CEO of of DMR. And so I want to kick it off and ask you a little bit about your past. So what originally got you into real estate?

I, you know, I think it, I think it's just like most people yeah. We'll get into real estate, like get, get into it by accident. I started out working for my father who was a former Xerox guy owned a, like a Kinko's before it was a Kinko's right. And one day I had gotten into a fight with my brothers.

And my my, my dad went to me and said, you need to use your powers for some good. Why don't you go work for this brokerage there, everything's starting to go online. And I think you can at least make some money this summer doing it. And man, everything just kind of rolled from there. I did a lot of design work and then I got into the sales end of things and it was just, the rest is history.

So, you know, you said the rest is history. What what's kept you in the business this long? What is it about real estate that just keeps drawing you back into it? Oh man. You know, I think other than the fact that it's like the mob, once you're in you're you can never really leave. I think the big thing is I've never.

I've never been a part of, of a business where the more good you do for people, the more profitable you're going to be. And, and, and when you think about, especially now with the way businesses in general there really isn't the case, right? But here in real estate, man, you, you, you, you serve people.

Well, you differentiate. You make them happy and you, and you make relationships. God, you know, it, it, it just keeps snowballing from there. So it's, you know, try to get out once it didn't really work. That's how I got back into mint into real estate Minneapolis, but man, it was, it's one of those things where I think it's just, it's it feel good thing.

And I don't think I'm unemployable outside of real estate anyways. That's you know, Rob Hahn our, our friend, Rob once once said the concept that we're part of this unemployables group and you know, we only work in real estate and, and can only do certain functions. But that's what we're best at.

It's our highest and best use. Right. Totally. Totally agree with Rob. So now here's the thing. If I want to trace back your history just a little bit. So currently Denver, previously, Chicago. Yep. Previously Minneapolis. Yup. Previously Alaska. Yeah, up and down the West coast. So yeah, it was, you know, when you're 20 something going up and down the West coast doing real estate thing during kind of the height of the post economic downturn thing, we're pre economic downturn thing.

Yeah, it was, it was a lot of fun. Just kind of seeing real estate from all over the country from that angle. But, but it seems like it's always cold weather environments. Tell me about it. So, so why the move to Denver and sticking with the cold weather, a process here? Yeah, it is I to NAR and it, it, I had a couple choices for jobs, you know, and it w it was, it was a nice position to be in.

I think it was just time anyways, to, to. To leave any are I've got that seven year itch. What I love about this market, not only the quality of life, which is fantastic, I got to get back into skiing and all the other outdoor sports stuff. And you know, I've got the family thing and, you know, Shane Oliver, but what I love about this market is that it's kind of at the nexus of all the change that is happening in the industry, right?

So you've got Realtors, you got licensees, you've got, you got technology companies, buying houses. And, and you've got the socioeconomic issues, right? One in one in four Denverites, only one in four Denverites can afford one in four renters in Denver can own can't afford to buy a home, which is a staggering number.

And it was, it was kind of like that challenge that interested me the most in spite of the weather, it's it's been great here and the challenges have been fantastic to deal with. So let's dig into that one a little bit. I actually have a number of questions for you in that in that same, same part of the conversation here and that, you know, like at Travis, we obviously have a big base in Denver, in fact too, it's actually where the majority of our employees are based at.

And you know, in talking to them, we have employees that, that are there that are. Making great money. I'm talking software developers and leaders of teams and, and you know, directors and VP roles that are in Denver. And I'm starting to hear from them that they don't see themselves being able to buy a house, even though they're making great money there.

And they're seeing. They kind of were San Francisco was 10 years ago. What do you think Denver can do to encourage more maybe development or, or more ability for those people? Like what you're talking about to be able to be homeowners? Yeah. And that's one of the things that I am really looking forward to doing here.

And I'm in Denver is teaming up with and reaching out to developers here. Cause the one thing, you know, coming from Chicago where you can't develop, unless you want to drive an hour, hour and a half outside of the city coming here where you can drive 15 minutes and go to develop a land. It is one of the great challenges to be able to talk to those folks and talk about what is actually needed right now and get some of these developers to think more think beyond kind of the, the that bang for your buck.

Because they can build these six, seven, $800,000 houses and get really good returns on that investment, but teaming up with them on what smart development looks like. Both out in the burbs in here closer to the city is a fantastic challenge. It's one of those things where I'm very cognizant of, I fully agree with your staff or is it, you know, Denver is looking like what San Francisco, you know, Eric, when we first met at an inbound conference even 10, 15 years ago was fairly affordable then, but it's skyrocket out of control.

Although, it's gotten a very interesting the Bay area here. I just want to be part of that, of that solution for people like your staff so that they don't leave. Right. And they don't go to places that are that are a little more affordable. And then they stay here. We don't have that brain drain.

That that is definitely happening right now. Kind of these major Metro areas. Yeah. And obviously from our end, we, we want to have sustainable workforce that doesn't need to move all the time. In fact, the reason we opened an office in Denver was five years ago. We saw it as the, the place to be where developers wanted to go to, to get away from the high prices of San Francisco.

And you know, we were having a hard time just like you in Chicago for that hiring a hard time, getting developers to come to Chicago or want to move to Chicago. They weren't already there. So the developer pool was small, but at Denver it seemed like every single person that was moving here or excuse me, every person that was applying for a job, I was looking to move here.

So, you know, you're, you're talking about developers building and like you said, if you don't know the developer, the Denver market. You can drive 15 minutes to the, to the East and essentially be in wide open land. You know, particularly from where both of our offices are at, you don't have to get very far and be in wide open land over there.

What are things, what are specific things that DMR that either you're doing or that you thought about doing that would convince somebody like Lindar to build three, four or $500,000 houses, as opposed to the eight, $9 million houses? Yeah, where I've already enlisted my government affairs directors too.

So DMR is, is the only local association here in the Denver Metro or in Colorado. That's got a full-time government affairs director. And that guy has relationships with with local regulators and legislators. It's amazing. And, and, and it's, it's bringing those worlds together that we're working on right now.

And, and breaking down a lot of the regulatory issues. To build, which is, which is the, that's going to be the first issue that many developers were cited as a reason for building up and, and more expensive homes rather than the more affordable ones along with bringing in kind of smart. Again, like I mentioned earlier, the smart idea, smart development, which is.

Integral for building within the city. Now, no one wants to have, you know, strip malls and, and ugliness kind of going throughout especially the urban areas of, of the Denver Metro area. With so many areas have got so much character is it's, it's teaming up with not only the regulators and the builders, but also the locals.

And the community where you know, you know, Brits on this, maybe he can echo this, but I've never seen a more siloed neighborhood ideal, right? Where you've got people who will worry about their four by four square block block radius, and only that four by a floor for a block square radius, but bringing in smart development with these folks who are fiercely, fiercely protective of.

Of of their communities and what the community will be and teaming up with those guys in a very smart way. The, the beginning of this is the politics and you know, it was one of the things that I, as a former non Realtor, going into the Realtor world, I was, I was a convert too. But that world is one of those worlds of right now is, is, is evolving.

Getting a lot more human. And if I can bring a little more of the Realtor and real estate flavor to that so that we can team up better, better on better developments. We will have not only a short-term, but a midterm and a long-term road to to home ownership for folks like your staff, no matter where they want to live.

Now, I don't want to sit there and say, Hey, to move to Aurora. I moved to Parker. There, there there's opportunity everywhere. As long as we partner up correctly and we're setting the the ground rules for that right now. And I think, you know, if you, you can go to Aurora and you can go to Parker of what's there, but in, in the environment.

And I think our employees would be happy to do that, but the, the environment that we're in, it's kind of being two different things. Number one is those houses that come up for sale in an error and our Parker. The numbers we're starting to see, and I still own, I own property in, in Colorado and actually in Parker.

And, you know, I've got an offer. For 10% more than the same offer I received in November of last year. So I just recently pulled an offer here in February and that same offer was 10% more. So the first, the first issue with development or a first issue with affordable housing, it certainly seems like, you know, the demand is so high beyond what's there.

That in the immediate future, there's no good way to solve it tomorrow. And am I wrong in seeing that? And that's why that these are 10% increases or do you, do you see something else? No, I've been watching the stats as well. They are alarming. What's been interesting is seeing, you know, as you know, my wife sells in Chicago, you know, getting a hundred thousand dollars over list over list price.

Multiple offer situation is not uncommon even in Chicago right now for million dollar properties. But when I hear a story about that happening with that, Five or $600,000 property. That's when it's like, wow. You know, I don't know how I don't know how first time home buyers are doing it right. First time home buyers, frankly, who are in that price point now, right?

Who are competing heavily with folks who are not only coming into the Denver Metro area, but that folks who are from what I've been hearing from my mortgage entitled people here they're land rich folks who are locals, who are selling off their land and making a lot of money and then turning around and buying homes where they, they.

But never considered before. Right. As either the, their primary residence or even an investment property. So it is it, is it, is there a sign of it? Waning off? I don't see it right now. I think we'll take it year by year. I think this next year is just going to be more of the same with less inventory.

What, what I'm watching are things like Google stats, I'm watching things like you know, search queries. I'm watching things like a census census numbers. When those things come out to see if there's any, any end in sight so that I can help prepare my members and their clients for for what will be an even more competitive market.

But we'll hopefully a little more limited. Yeah, for sure. And that really yields to the second. The second part of the problem is. You know, what Nobu Nobu was, was alluding to in terms of building and, and the politics and everything like that. There's more than just even politics of getting approval. Like what you're talking about in Colorado, there's this problem of the water rights and you know, building a single lot.

Can mean a $25,000 tap fee to, to connect up initially to get water rights. So $25,000 of a builder's cost of building the home can be involved in, in the price that they pay to connect up to city water that's there. And so it seems like there's something has to be done about that. And I don't know how sustainable that is over time because of the water problems that Denver has.

Right. Yeah. And what happens is, is that you know, shit, cause we are in actually in touch with, with those, with the various waterboards around the Metro area, which been, that's been a very interesting conversation if that's a new one to me and it's been super cool to actually have. But any movement with those guys creates problems in another regulatory areas, including taxes, right?

So you know, we're, we're watching all of that to, to help guide not only policy for today, but policy for tomorrow as this. Metro area evolves and grow. So we can, as we can all be part of what this community is going to look like in five years, for sure. And you know, getting in just for a second more on this hyper Denver specific topic obviously I'm interested in it.

You know, the, the numbers that you're seeing of people move there. I know. The last number I saw was that Denver essentially doubled in population over a 10, 10 year period. But is that, are you still seeing that's happening and particularly with the pandemic, are you still seeing, or getting anecdotes of those numbers holding up or even moving higher than the word before?

Oh yeah, I it's. They're going to, they're going to more affordable areas too. You mentioned Parker that that area is one of the fastest growing zip codes in the country. Right. So, yeah, I mean, it, I think people are realizing the Denver Metro area is massive. It's almost like St. Chicago land. Right.

Except for, you know, we've got an airport to the East instead of a big old freaking Lake. But here, you know, yeah. You're seeing, you're seeing folks migrate out to areas. They probably wouldn't even considered now that they know that, that you know, You've got you got Parker, which is what, five minutes away, 15 minutes away from the DTC.

And I was in castle rock today. Same exact thing. Right? So it's, it's filling in that areas between castle rock, rocket Parker with the the Denver Metro area that we'll be watching closely. But man, is it a crazy time here or what. For sure, for sure. It's a good time to be an owner. It's a very tough time to be a current renter or somebody who wants to purchase at one point.

And it's something I'm very concerned about in terms of my employees, because I want them to have somewhere sustainable that they want to be at and build a family and have that American dream. That's the same reason you and I got into this business. You know, you, you talked about starting about bringing happiness and, and, and putting that into people's lives and helping them achieve these dreams.

And. You know, something I'm always worried about is my people that I consider, like family to me you know, worrying about them, building wealth over time with the idea of home ownership for the industry that we're in, we're in. And I hear them make these statements to me. And it obviously makes me very nervous and, and I w I'm always interested in what can be done about these things.

So it's great to hear somebody like you. That's in charge of the association, there is thinking about it, working on it, and I can't wait to see 'em. More specifics, come out over time of things that you guys are, are able to work on, both from the political side and from the building side to get them to do that.

So moving on, let's talk about let's talk about running an association because that involves politics. So, you know, how much of your daily life in being the CEO of DMR? How much of that is. Maybe about politics and dealing with brokers and dealing with agents and, and their process. Or maybe even talking about from dealing with literally politicians as we traditionally think about them versus a day-to-day running of an organization that, that a CEO typically does.

What is the D what does a day in Nobu life look like? You know a lot of it is, it's almost like what, you're, what you're talking about. Right. And I, I'm trying to run a business here and that's the way I think about it. And that being said, politics is rampant everywhere. What's different about this.

This market is how fiercely protective people are. And, and as you mentioned earlier, I've been to. All 50 States, you know, and I grew up in Alaska, one of the, the most fiercely independent markets out there, period. But here I've never experienced people who are like, I don't go East of East of , you know, I don't go out and...