RISMEDIA, March 16, 2010—It doesn’t take a genius to know that events of the past few years have greatly affected the public’s view of real estate agents. Now that image is below that of used car salesmen (except, perhaps, Toyota used car salesmen!) and many are publicly stating that the agent’s time is over, that maybe it’s time to take corrective action. What do you think?
Before exploring that, however, you should know that the study referenced above was conducted by the California Association of Realtors and reported in many newspapers (I’m quoting the Orange County Register, here). “California leads the nation,” we used to say around here, but lately, its in dubious distinctions like this one, it seems. It is possible that in other parts of the country, dissatisfaction is not quite this high.
The study reported on consumer responses to one simple proposition: “Yes, I would use the same agent” over the six-year period from 2004 to 2009. It reports that 79% of respondents said “Yes” in 2004 but only 22% said “Yes” in 2009. Statistics like these do not inspire loyalty campaigns or much hope for referrals, do they?
What happened?
According to the study, 64% of sellers said “the house took too long to sell” and 51% said, “We didn’t get the price we wanted.” Thus, the disaster fomented by Wall Street has been neatly transferred onto the backs of real estate agents. It’s no comfort to realize that while some Wall Street ‘Investment Banker’ is spending his seven-figure bonus on that house on the Vineyard and the newest Bentley, the public’s anger at the financial crisis has trickled down to those not responsible for it.
The very people you are working your butt off for, blame you for their unrealistic expectations and in many cases, agents are enabling that by not setting sellers straight on the new realities of real estate pricing and financing. It is doubtful that the consumer will wake up anytime soon. Anyone with an ARM can no longer afford can blame you. Anyone in a house worth 30% less than what they paid for it can now blame you as being the reason for their dilemma. That’s much easier than blaming their own greed or naiveté, of course, but who ever wants to take personal responsibility anymore? Certainly not consumers, it would appear!
Short-term consequences for real estate companies
Branding takes a hit
The financial crisis that produced the “Hate your real estate agent” trend also has reduced the power of Internet corporate real estate brands. Consumers today are more attracted to individuals than entities: no one cares about being friends with a company and no one thinks a company will treat them as well as a real person will (i.e., a buyer will search for “Wasilla AK Real Estate,” not “International Behemoth Real Estate agent in Wasilla AK”). The Internet shopper resists and resents any effort to make them go through even one unnecessary step to acquire the information they want and that includes being driven through hoops on the Intergalactic Amalgamated Real Estate Behemoth websites. The consumer today is more likely to identify with an individual agent than a corporate leviathan. For the individual agent, this is good.
Personal response and service have become vital to success
In our business, we see structures in brokerages and corporations that literally make us shake our heads and wonder how those organizations are surviving. One of these is the lackadaisical approach to inquiries from Internet buyers. Believe it or not, over 50% of Internet leads are never responded to in person and believe it or not, 50% of such inquiries are responded to in an average of 54 hours. This has enabled savvy agents to structure their leads and inquiries for their websites to be SMS texted to their powerful phones, where—with a simple touch—the inquirer can be called back in minutes. If you were an Internet buyer, would you wait days for a response that might never come or would you respond favorably to the agent who calls you personally within minutes and asks how they can assist you?
In the next few years, the business will return to a model where personal service is given at a high level and where the agent becomes the source for information. Just dumping people in an IDX or MLS doesn’t cut it anymore, folks—you must do the looking for them. For the hardworking agent, this is good.
More agents will develop the guts to just say ‘No’
When there’s nothing in the pipeline and the opportunity to take a listing for a property that is priced 30% higher than reality now dictates arises, it is very hard to walk away. After all, someone will take the listing, right? Please—let someone else take such listings. That same survey we’ve been referencing also revealed that an incredible 2 out of 3 homeowners originally listed their home with a different agent than the agent who had the listing when it finally sold. Imagine all the blood, sweat, tears and money wasted by agents who take unrealistically priced listings. This nonsense won’t stop until agents remember that a listing gained at an unrealistic price will only result in an unhappy customer, and another statistic for such studies. For the agent who wants to stay sane, this is good.
Long-term consequences
Skill, hard work and mastering technology to bring you prospects will become more important than spending hours blogging, posting listings, tinkering with websites and generally not selling. Technology that simply requires more involvement from the agent will languish – in large measure—because consumers aren’t driving the use of video, the endless hours of social networking, the ubiquitous IDX systems and other colossally unproductive drudges that agents are now told they must embrace; it’s the technology companies driving that.
The consumer wants help choosing a home and getting it financed from a knowledgeable and responsive agent. They want to pay a fair price; they want a deal that will appraise out; they do not want to waste their time on uneconomic transactions. Most of all, if they call or write in on your website, they want an instant and friendly response. In short, they want the service that used to be inherent in a real estate agent and they will continue to gravitate to a minority of agents who give such service. The Internet helps them find those agents, faster. Sometimes agents don’t know that their way has been made obsolete and they inadvertently give poor service. For example:
This week, an agent complained that he wasn’t getting sales for the Internet leads he was receiving. We asked him why he had not attended the free class on how to best follow up those leads. He replied: “I know how to follow up Internet leads! We send an immediate auto responder and put them on an MLS drip email system! I don’t need your @#%#@ training!”
Folks, kill all auto responders. Do not put people on drip email systems. Do not automate anything about the sales process until and unless you have spoken with the prospect and they have asked you to do so. This agent was wasting the fruit of his labors by not contacting people personally and consistently. Today, it’s a merciless marketplace and every one of those uncontacted leads is now speaking to another agent.
That’s just one simple example, but many others exist; repeat after me: “Succeeding today is about personal service, hard work, professional representation, and modest use of effective technology.”
Isn't this amazing! Remember, connect with a Realtor who can represent you appropriately and professionally. A home purchase is more than opening a lockbox and selling your home is more than putting a sign in the front yard. If you have questions about locating a Realtor in your area, contact me and I can connect you with a professional Realtor who will represent you well. Don't fall into the category mentioned in the article!
It is March 16, 2010 and I am very Bullish on Sacramento!
David Ohara
@dwo34
dwo34@aol.com
