The Perfect Storm
I believe that the perfect storm has assaulted the Real Estate Industry over the last 3 years. The perfect storm is a combination of the horrid economic conditions in this country, the worst Real Estate market in 80 years and the rapid advance of technology.
Together these conditions have altered the Real Estate Industry landscape so dramatically that most of us haven’t experienced such change in our Real Estate lifetime.
I’m fortunate enough to have the ability to speak often, with some of the greatest leaders in our industry. Just today I had a conversation with one of these individuals, and he agrees that massive changes are staring us in the face.
We all know that sales have been so poor in the last three years, that the Realtors and Brokers who have survived, have had to tighten their belts and make do on less income and less sales.
Then you throw in all the technological changes, and it has dramatically changed our landscape. It use to be that when a buyer came into an area to buy a home, they sought out a well known and trusted brand. They had no ability to find a property for sale via the internet so they had to put their trust in a Realtor. So in most cases they choose a well known and trusted brand.
That is no longer the case. Just this year the statistics now tell us that more buyers find the properties they want to look at, before they find their Realtors. So it’s the tech savvy Realtor that gets back with this buyer first that usually secures the buyer.
No longer is there a need to seek out an office of a well known and trusted brand.
Then you throw in what the Broker use to mean to the Realtor, and how that has changed. Now we are starting to see the trend that has so dramatically, in such a short time, created a paradigm shift in our industry. I relate it to when the jet engine changed the aviation industry. It’s been that dramatic. I know I have written about this in the past, but I can’t stress it enough. Many of my friends are Realtors, Brokers, and owners of Real Estate Brokerages and I have the upmost respect for them, and I wonder how this will all turn out.
I’m not discussing the brand new Realtor in this article. I’m talking about the Professional Realtors. Those Realtors that have been in the business for 5 years or more, the Realtors that still do a minimum of one sale a month in this environment. The Realtor that puts ethics above all else and lives by the Golden Rule.
It is those Realtors that are now asking for and receiving 100% of their commissions, because they aren’t dependent upon the Broker to generate business for them. They have their own leads, their own following, their own computer, their own scanner, and their own way of doing business.
We are seeing these Realtors using the extra income that they are putting in their pockets to market more, and in some cases they are even opening their own offices. We have seen many Realtor Teams that love having their own suite of offices. These offices are their office and not the Brokers office, and they like that feeling of independence. A true Independent Contractor.
We are also seeing the Realtor that’s happy to meet their clients at Starbucks, Hilton and multiple other locations because most of their clients are referrals from past clients.
If you use the 80/20 rule that we all use in this industry to determine who the top producing Realtors are. That means we have over 200,000 Realtors that fall into this category. They are also the same Realtors that the Brokerages count on to deliver $20,000 to $60,000 a year to their bottom line.
What happens to a Brokerage when all these top Producers decide they want to keep 100%?
Negotiating Tip 114: Retreat Negotiations
March 29, 2019
Negotiating Tip 113: Activating Our Opponent
March 28, 2019
Negotiating Tip 112: Misconceptions
March 27, 2019
2019 Real Town The Real Estate Network