Manage episode 280254490 series 30940
Hey everybody--I hope you are doing well wherever you ---- last week I shared a little of what my end of year planning outline looks like. If you havent heard that episode----that is something that you might want to consider. Today---I was thinking of covering some of the areas that you should consider adding to your plan right now. One thing I wanted to cover is something I am watching closely is the eviction moratoriums---right now the eviction moratorium is scheduled to sunset on december 31, 2020 according to the wall street journal in January there are between 2.4 and 5 million households at risk and more in the following months. While this is a very sad and I wish that no one ever has to be forcefully removed from their home----the fact is there are going to be a lot of rentals hit the market I think this poses an extraordinary opportunity for a lot of people.
In my preparation for how to best position oneself to capture this opportunity I thought it would be most helpful to the audience to talk with you about cutting costs as we move into an uncertain economy and how to best place yourself to capitalize on opportunity as they appear.
When looking at your business planning for the year you really should start off with reviewing your brokerage. If you are thinking about making a change or just entering the industry. I want to share with you some things you may want to keep in mind.
First--let me say that if you are considering making a change---right now is the time to do it. Heres why:
1) You probably have less of a pending transaction "pipeline".
Most buyers and sellers wait until after the holidays. If you make a change, there's less chance any unethical corporate document skimmer will try to screw you out of commissions.
But, hey your broker is most certainly ethical, that's why you chose them to begin with right? Yeah--most brokers are very ethical but, there are plenty of corporate clowns that will hold money back in the hope that you wont pursue them in small claims court
Too often sales people that are headed out the door are nickeled and dimed others lose client relationships and that adds up to tens of thousands of dollars over and agents career.
- If you do have clients under contract---many of those expire during the holidays and if your client happens to cancel while your in the middle of a broker change well uh--everybody wins --I think. It will at least make your job change easier.
Choosing a broker is much more than just looking at the office or the splits. You really should be asking yourself what broker is going to spend the most effort in helping you grow your business. The fact is most brokers are just big recruiters they are not incented to help you grow. Most brokers will hire you sight unseen even though, they will tell you that they only accept 1 out of 10 agents. They hire almost anybody because they are not going to give you anything otherwise known as leads.
I want to credit inman writer missy yost that came up with some of the questions and content I am going to share.
When looking at brokerage you need to decide whether to join a team or build your business on your own. There are many pros and cons of joining a team and in my mind a lot of people join teams mainly because they are either nervous about their ability to generate leads and they are nervous about setting out on a desolate landscape on their own. In short--they are nervous about becoming an entrepreneur.
Before you jump ship on your current broker or blindly join a team here are some questions you should consider.
- Does your brokerage offer agent support, and if so, to what extent?
The amount of support an agent receives will be one of the most significant differences in brokerages and brands.
Some are geared more toward the self-sufficient agent, while others will do everything for you.
If you want an admin person to enter listings into the MLS, prepare e-blasts, postcards, and other marketing materials, choose a brokerage that provides that type of support. However, you should know that very very few brokers are any good at marketing so if a broker tells you they will send out email blasts, postcards or anything else for you ---ask them to see the last thing they sent out and then ask them to see the response rates. That will give you some kind of idea of what they are really doing.
If you are like me and are OK doing this yourself, this type of support will not matter.
In general, the more support a brokerage offers, the higher the fees might be for you.
The second question to ask is: What do you do to retain your agents?
When a brokerage focuses more on recruiting than retention, it's a red flag.
Good brokerages will spend as much time on the retention of good agents as they do on recruiting. The broker should have a clear answer regarding incentive programs geared toward agent retention.
- Do you encourage your agents to come into the office to work?
Working from home or at the office is vital to many agents.
If you work better around others than you do in a home office alone, then desk space and a busy office are essential for your success.
Some offices are quiet, while others are full of energy. Pay attention to the vibe, and choose a brokerage that fits your work style best.
Question # 4. What are you doing to incorporate new technology into your real estate brokerage?
Old school brokerages that rely mostly on old school methods such as door-knocking and calling FSBOs and expired listings are fading, while brokerages that encourage video, social media and iBuying tools are becoming more relevant.
Make sure the brokerage you choose embraces new technology. In this environment its critical that your broker has all the tools for you to run your book of business virtually, that they understand social media and how to use things like facebook ads or google PPC.
It’s OK if it teaches a mix of old- and new-school methods to agents. It’s not OK if it’s ignoring new methods of prospecting.
- Does your brokerage encourage teams?
The trend in real estate has been moving more toward teams and less toward the individual agent.
However, brokerages embrace teams differently. Some look at them as a group of agents that share commission and responsibilities based on their separate agreements with the brokerage.
Others allow the team leader to set commission and all other requirements for their team members. In this case, the brokerage pays the team (usually a business entity), and the team pays the team members.
As a new agent, being part of a team gives a sense of belonging, and though commission might be less, you make up for it in volume.
If you are thinking about being part of a team, interview multiple teams before deciding which one to join.
- What fees do you charge your agents, and which ones are optional?
Some brokerages have high monthly fees, and others have no fees at all.
Ask about mandatory fees, what they cover, and what fees and offerings are optional.
If you don’t need a desk, you don’t want to pay for one. You’ll want a brokerage that, at minimum, offers a website, lead capture, and customer relationship management (CRM).
- What are your commission tiers, and do you have a cap?
Too many agents get wrapped up in their commission split. If you’re not selling, your split doesn’t matter, so choose a brokerage that fits your needs first, and then consider commissions.
Companies that have a cap will give you a 100% commission once you meet your annual cap. Other companies will increase the commission as you meet specific sales levels.
Your commission will not reset at these companies every year, but it might decrease if your annual volume falls below your previous year’s volume.
- Do you have franchise fees?
If you choose a brokerage with franchise fees, you will always give a portion of your gross commission toward these fees. The more you make, the more you’ll give.
Franchise fees are usually up to 8% of your gross commission. and that can add up over time.
One thing is very clear pandemic or no the business of selling real estate is changing and they are a lot of very deep pocketed companies that want to disintermediate the agent---there is simply too much money. Tom Ferry once told me that real estate and all its accompanying parts accounts for 20% of the nations GDP. The takeaway from this is that we must stay ahead of tech focused companies that want to automate most of the home selling and buying process.
You can look at some of the moves zillow has recently made. You can look at the rise of ibuyers and the tremendous amount of money that has been raised. You can look at new companies like OJO that just closed a 134Million dollar D round---these guys are buying up small portals like digs and movoto and are rapidly developing AI to ask, answer and deliver an end to end solution through technology.
If you want to thrive in this environment you must develop a fully defensible unique value proposition or you will be soon obsolete.
Right now more than ever we need to make sure that your broker is not doing the same things in the same ways as every other brokerage---it is truly innovate or die on the vine. I dont know about you but, I dont want to look like that old travel agent that still sits at his desk with picture of hawaii up on the wall hoping that someone will walk in and ask how much a plane ticket is.
I want to be ahead of the game and I hope that you do as well. I will leave you with this--if you have questions about what broker is best suited to you or you want some help in crafting next years strategy I am here to help. Send me a text--my direct line is 6193010823 or you can send an email to firstname.lastname@example.org Until then---I hope you are safe and I hope you can still dream big dreams. I cant wait to hear what you want to achieve.