Agents who are shifting to new world business models work less hours and double their net income. If you’re interested in reducing your hours to 30 a week and doubling your income, read this.
+ Most agents chase as many appraisals as they can each month.
+ Agents that chase listings don’t have time to service the buyers of the properties they are selling.
+ Agents who have a lot of listings have to outsource buyer management to less experienced agents because they are too busy
+ They are too busy charming the buyers with properties to sell. ie possible listings
+ Often the best buyers are neglected with this approach costing vendors money with lower sales prices. In some cases $50,000 to $100,000 less. Watch the video in this article for proof.
Agents that mainly focus on chasing listing appraisals are not only burning the industry, they are burning buyers and burning their clients property prices. This practice of the “numbers game” has been getting pushed by real estate trainers and coaches for many years now and it causes burnout for agents as well as poor professional service to genuine property buyers. However, there is a much better way for estate agents to achieve their listing, sales and income targets, as you are about to discover.
Let’s get back to how most agents are taught and trained to reach their targets. In fact, let’s start with why agents feel the need to hit large appraisal targets each week.
Most agents have very little differentiation from their competitors except for their interpersonal or communication skills with clients.
Some agents will talk about their photographer being their point of difference or perhaps their database. Let’s face it almost all agents have a database and should be able to style a property to look great. Most agents also have a great photographer who can create an impact in making the property look great on the internet.
Most agents in Sydney can create a great auction campaign, conduct open homes and follow up with the buyers who show interest at these open homes.
So why do some agents end up in more lounge rooms pitching while others miss out? It’s about your approach. The trust you develop with the vendors which makes them think, “this guy will do a good job”
Most of the biggest agents know it’s their dogged discipline making hundreds of phone calls together with direct mail and the magic 6 or 8 touch points is the key to success. They train their teams to do the same and the industry plays follows the leader. That is he or she who sells the most must be good so I will be like them.
Unfortunately the genuine buyer who doesn’t have a listing to barter for the agent’s attention can end up being neglected and frustrated. So much is this neglect that I am finding more and more buyers telling me that they were willing to pay $30,000 to $50,000 more than the ultimate sale price, and in one case over $100,000 more.
This is a significant difference many agents could be making. But they don’t spend the time with those buyers and end up losing out for their vendors.
Why is this happening?
Because getting listings is competitive.
There are more and more agents fighting for less and less listings.
What if I told you there is a much better way to run your real estate sales business. A way that allows you to give a much higher level of service to your vendors, and to ALL potential buyers, even if they don’t have a property to list with you.
You never know which buyer is going to offer your client the highest price. Therefor it is critical that you and your team give the proper service to every single buyer.
There are many trainers and coaches servicing the real estate industry, sales in particular (because that’s where most of the money is for training) and unfortunately these trainers encourage the “numbers game” ie volume of sales over quality of sales outcome.
More is better, right?
Balance is better, all things remaining equal.
What do I mean by equal? Well providing you get to bank the same amount of money or more, would you rather sell 6 properties for the month or 3? It’s not a trick question.
Don’t make the mistake of thinking this is a joke because you have been conditioned to believe the industry standards of commission splits are fair. They once were but they are not anymore.
I remember when it cost $500 for a return flight to Brisbane, now it’s $100 to $200, less than half.
What about the taxi service industry, instead of paying $30 to get into the city with a 15 minute wait, a dirty stinky car and a driver with a bad attitude. Now with Uber you can press a button on your phone, within 5 minutes be picked up by a personal chauffeur who is polite and drives a clean car and it mostly costs much less. Plus you get a smile, bottle of water, mints and a phone charger.
Our industry is going to be a lot different in 10 years from now and you have to ask yourself if you are willing to get ahead of the curve.
The emerging business models available for real estate agents are changing the game forever, just like Uber.
These new business models allow agents to lower volumes while taking home more money.
And the consumers win too.
They win because they get to deal with agents who don’t have to turn them upside down at every open home to see if an appraisal falls out of their pocket. These agents can enjoy a real conversation and genuinely work to help the buyer find the right home for them.
It allows an agent to be more selective about whom they want to invest time with. The conversation in the agent’s head goes from “who can I list here” to “who can I help here” and “who do I want to work with”. The result, a significant difference in your energy the consumer feels because of your change in behaviour.
The consumers will start to notice and you will get referrals.
It’s a real point of difference in an industry where agents are talking and acting like professionals while the old world agents are “shaking down” consumers for appraisals.
If you have a goal to achieve $1,000,000 in gross selling fees for the year the very next question and I believe the most important question you should ask yourself is how much of this do you want to bank and keep?
Most agents on a 50/50 type split would keep $500,000. Well that’s not the full story either is it? To do these volumes they would likely have a PA, there’s $60,000 plus employment benefits and you need to manage them. What happens if they are sick or away, maybe you need 2 assistants, that’s $120,000 a year. Now you are down to $380,000.
Not bad right?
Probably more than what most agents expected to ever earn.
But in the new world model it is an average result.
To quote the great ice hockey player Wayne Gretski “move to where the puck is going” rather than following. In the new age model, agents may bring in a lower GCI say $500,000 to $700,000 but they can do this working just 30 hours a week. But here’s the good bit, they take home between $445,000 to $641,000. Well over the $380,000!
These new world agents are making just 5 appraisals a month (because they are taking the time to qualify them) and focusing on those property sellers with properties that really match their objectives.
Imaging how much better your whole life would be.
+ Just 5 appraisals a month instead of 20.
+ You list 3 or 4 a month instead of 5 or 6
+ You have a much simpler life
+ Can be building your own rent roll
+ Your take home net commission is double your competitors who are still chasing the puck.
Oh not to mention you only work 30 hours a week instead of 50-60.
Don’t make an emotional decision to stick with “comfy” when you really need to make an educated decision and move from the old world to the new world.
ABOUT OZWAY REALTY
Real estate agents working with Ozway are known as Family Business Members. Ozway provides agents with full administration support for a very affordable flat fee. This support allows Ozway agents to focus on listings and creating great relationships in their locality.
Too many good agents are surrendering commissions to principals who don’t provide a fair exchange of value for service. Ozway offers a more equitable deal for agents.
Ozway charges a single, flat fee on settlement. The rest of the commission goes straight to the member. Ozway member agents keep around 90% of GCI** after expenses.
*DISCLAIMER: This post is not intended to be taken as financial advice of any kind. Please consult a licensed financial advisor or accountant for advice.