What Do Realtors Really Do All Day?
Let’s pretend you’re a new agent and you’re interviewing companies to go to work for. I’ll start by describing a typical franchise real estate office, such as Century 21, Prudential, or Coldwell Banker.
The way you’ll get business is by taking turns answering the phone, also known as “Floor Time” or “Opportunity Time”. Your job when people call in is to “convert” them. This means when someone calls to get the address of a property advertised, your goal is to turn them into an appointment to see other properties also. If it’s a seller that calls in, that becomes your opportunity to get a listing.
You will also attend office meetings and go on “caravan”. This is how you learn what’s available, even though you have no buyers for the properties you’ve just seen. It is mandatory to attend all meetings and office caravans.
The broker who owns the company will tell you to pick a “farm area” and start soliciting that area by dropping off recipes or other information. This way by repetition, your name will become known as an area expert.
You are paid no salary, you are totally on commission. The broker will pay for the rent, the copy machines, the MLS dues, the receptionist, your signs, and anything else you need. The broker pays for advertising, and he decides what properties will be advertised and how often. In return, you pay the broker a percentage of your commission when you do sell something, typically a 50-50 split for new agents. If you have a few slow months, you don’t make anything, but you don’t pay anything either.
Why is our company different and what does it mean to you? Now imagine you go to interview at a small “maximum commission” boutique company. What you find out is that you run your own business, but you’ll be setting up shop under the company banner. It’s like opening a store in the mall. The company is the mall, and you are the store owner. So you are independent, but there are some common facilities that you must contribute towards.
When a call comes in on your listing, you get the call, not someone on “Floor Time” who doesn’t know anything about the property. Your time is not wasted with unproductive meetings and caravans.
You will pay for rent, all fees and dues, your signs, supplies, promotions, and all advertising. Just like a real business! These expenses add up to about $2000 per month. In return, you get to keep most of the commission.
Now if you were a new agent, or unsure of yourself, which way would you go?
If you did a financial analysis to see which way works out better, you’d see that the “break even” point is about 12 transactions per year. This means that if you do less than that, you are better off by having the broker pay everything, and receiving a split commission. If you expect to do more, paying your own expenses works out better. Keep in mind that the average agent in California does less than 4 transactions per year!
Since we are independent agents, we must pay our expenses every month, whether we sell anything or not! We must earn over $30,000 a year before we make a dime! It takes very few slow months before we’re in a deep hole financially. This is why we are motivated to sell your home…we can’t afford not to!
What You Should Expect From a Professional Real Estate Agent
Even though agents have a fiduciary duty of utmost care, integrity, honesty and loyalty in dealing with you, we’ve found that agents can technically perform these duties and yet you can end the transaction feeling that the agent didn’t have your best interests at heart.
Here’s how we take those cold legal terms, bring them down to earth, and apply them to your personal experience.
You should expect to be treated with respect, not like a number.
You should feel like the agent’s only client, not like transaction #34.
You should expect to have your best interests represented. The whole moving process should be as painless as possible. Your agent’s eye shouldn’t be on your wallet, but on serving you selflessly. Your agent should not think of you as a transaction that will be gone in a few months, but more like a friend and a client for life.
You should expect your agent to work as hard for you as he would if he were buying or selling his own house.
You should expect the highest skills available. Your calls should be returned promptly, you should be kept up to date, and not feel like you were forgotten by your agent.
If any problems do arise, your agent should go overboard to fix them and document everything diligently so that you are protected.
After the transaction, you should expect your agent to be a trusted advisor that you can consult anytime. You should feel like you were represented professionally, and that you came out the better for it.
Why We Have a Lot to Lose!
Our business is built on referrals. What this means to you is that we don’t spend a lot of time on prospecting activities to find new clients as other agents do. So you get all of our attention and energy. We feel that by providing you with the best real estate experience you ever had, you will naturally want your friends and associates to have the same benefit. When this happens, we can devote even more time to making our service the best available.
Since we don’t knock on doors or make cold telephone calls, we depend on referrals to grow our business. We HAVE TO give you excellent service. You MUST be happy, or there will be no referrals from you, and our business will suffer. So we don’t see you as just a transaction, here today and gone tomorrow. We’re not superstars, pushing people through some kind of assembly line, but we see ourselves as super servants. We treat your business with great respect, and want to be your REALTORs for life.