The best realtors are great sales people. Like any other sales job, making “some” money as a real estate broker is easy. However, to make serious money, you have to put on your sales hat and start thinking.
Starting as a Real Estate Agent
Once you get your real estate agent certificate, you have a very good chance of earning a decent livelihood.
With a 2.5% commission on a $700K house, both the selling agents and the buying agent each gets paid approximately $17000. That’s decent money for work which is not exactly back-breaking.
Even after paying off your broker, taxes and other expenses (e.g. Starbucks latte to lubricate homebuyer’s wallet), you still get to take home some serious moolah.
You won’t starve in a booming housing market. But how to make a lot of money in an economy which seems to be on a plateau?
The Challenges for Real Estate Agents Today
The real estate market might be on a plateau now and it is getting tighter.
The exciting thing about being a salesperson is that you have to constantly confront challenges and best your competitor agents. You are a hunter in the wild. You eat what you kill.
However, together with excitement comes the need to survive.
The Buyer Agent
Life is not a dream for buyers agents these days.
Home buyers can search for houses without leaving their bedrooms. Increased buyer access to real estate-related information means that prospective home-owners don’t see much value in engaging a buying agent.
Your customers can educate themselves about all facets of home buying and selling – e.g. search online for currently listed houses, get information about mortgage options, investigate city records for building permissions, look-up valuations of nearby houses sold, learn about neighborhood amenities, schools and transit in the area. Any buyer with a few hours of searching on the right websites, can unearth all the information her or she needs to make an informed decision.
Not being dependent on a buying agent means that the customer is free to look at a lot of options through open houses, instead of being pressured to purchase after 3 or 4 showings.
One of my friends who acts as a buying agent complained how the market is tough nowadays. He told me about one of his long time clients, Charlotte, who hired her own home inspection agent and lawyer, and needed a buying agent only to process the transaction. My friend said, “Charlotte got her niece (who had got her real estate agent license a few weeks back) to help with the papers. I was left in the cold.”
The Selling Agent
The seller agents too are under pressure.
It is in the interest of the selling agent to sell the houses quickly, not necessarily at the highest price. The difference in the commissions for a selling agent is minimal (especially after paying off brokerage fees and other parties), even if they negotiate a slightly higher price for the home-owner. The incentive to push for higher prices for their client is simply not there.
Homeowners feel that if they want to push for higher prices they must take matters in their own hands.
To strive for higher prices, many homeowners list their houses on Craiglist and other “direct from seller (FSBO)” sites. In addition to the possibility of higher prices, they feel that they can save on realtor commissions. Unless a homeowner is under pressure to sell the house quickly (e.g. relocating to another city), he or she might not want to cough up 4.5% of the house price to the selling agent just to put up a yard sign.
These market dynamics put the onus on the selling agents to prove their value.
How Are Real Estate Agents Reinventing Themselves?
The changing landscape for real estate sales means that there is intense competition among both buyer and selling agents.
Competition among brokers provides homebuyers and homeowners opportunities for better prices, and the ability to demand better quality services from brokers.
The Silver Lining for Realtors
Competition brings many benefits for the brokers and agents also.
The fact that easy money is no longer to be had, means that wannabe part-time real estate agents are getting squeezed out of the market.
To compete on price, some agents offer lower commissions to home sellers and, where permitted, rebates to home buyers. But, really savvy salespeople compete on value, not on price.
The agents who want to make a living from their business focus on adding value to their clients and provide ancillary services.
Homeowners Continue to Trust Realtors
There is no law which prevents consumers from buying and selling houses themselves. Yet, a recent survey found that more than 90% of the homeowners used a broker to sell their houses. Even though the internet has made every bit information available on your mobile phone, nine out of ten buyers leverage a real estate agent for finding their dream home.
Who are these agents who continue to enjoy trust from their clients?
Good realtors work as trusted partners with homeowners. The agents who are successful today are those who find ways to provide value added services. Instead of sitting back after listing a property on MLS, good sales reps actively promote the listing in their contact network. They work with homeowners to sell their homes providing best practices such as staging advice, strategic upgrades and completion of a pre-sales home inspection. The buyer agents educate themselves on the neighborhood characteristics so they can properly guide the buyers. They show buyers homes that are likely to match their preferences. In their blogs they include real estate tips (e.g. house inspection checklists and mortgage buying tips) which help their clients save money.
Go Big or Go Home!
Our discussion about real estate market trends, brings us back to where we started – the best buying and selling agents are great salespeople. Like any salesperson, a good real estate agent doesn’t just want to scrape a living. He or she wants to wants to win a lot of business and make serious money.
To win a lot of business, you got to have a lot of big customers. You can cold-call people asking them for business. Or, you can get customers to come to you.
How Do You Get Customers to Come to You?
You get customers – home sellers and buyers – to come to you through inbound marketing.
What’s the best inbound marketing strategy?
According to HubSpot (https://www.hubspot.com/marketing-statistics), 55% of marketers say blog content creation is their top inbound marketing priority.
Your blog posts continue to bring in customers over time since organic search increases their traffic over time. As HubSpot (2016) stated, 1 in 10 blog posts are compounding over time.
Savvy realtors exploit the power of blogs. Real estate blogs for clients bring visibility to realtors and establish them as trusted entities. To grow your real estate business the easiest and yet, the most effective strategy you can adopt today is to start a simple blog!
In many ways, a realtor is both a salesperson and an entrepreneur running his or her own business.
In every industry, businesses are using blogs and vlogs to attract and nurture customers. Writing and talking about how you do business establishes you as a credible, trustworthy entity. In your vlog or blog, you can share real estate tips, talk about home-buying best practices and trends in neighborhood real estate.
Your online presence will establish you as a thought leader in your profession. As a homeowner I am more likely to gravitate towards someone seems well known all over the internet, than someone who just carries a business card.
Starting and growing your blog is easy.
You can start your real estate blog estate blog today. Instead of getting trapped in complex tools, use the Zavesti.com simple guide to Write Your First Blog Post or Vlog Script Today: https://www.zavesti.com/write-your-first-blog-or-vlog-script-today/