By Scott Newman
So you just found out your buddy got a big promotion and is now ready to buy a sexy luxury condo in downtown Chicago. He’s your boy–you’ve known him since grade school–of course he’s going to give you first crack at the business, and you’ve already started spending the commission check. But before you blindly agree to be his agent, stop and think of the potential consequences of working with close friends and how you can make sure it’s a positive experience for both of you.
Treat Them Like Any Other Client
Many real estate pros go one of two ways when they work with friends – and both are bad. The first is when all their professional experience and training goes out the window and they act super lax and unprofessional thinking it will be OK because they know the client.
The other is the agent who takes things so seriously that they literally suck all the fun out of the entire process for the client, who then ends up never wanting to work with–or refer anyone to them–again.
What’s the lesson here? Forget about the personal relationship you have with this particular client and give them the same high level of service and overall experience you provide to all your other clients. If you follow that golden rule, you virtually eliminate the risk of damaging the personal or professional relationship with the client.
Expect To Go Above and Beyond
I have literally seen agents arguing with close friends they are representing while in the hallway outside the closing office. The expectations the client had vs. the expectations the agent had might as well have existed in two separate universes.
If you work for people you know personally, know from the beginning that meeting the minimum acceptable requirements of your job will not be enough. If that’s all you do, then you will likely upset your client more times than not.
Remember, your friends are hiring you because they think you’re good at your job and because they want to give you the business. But they also subconsciously might expect to lean on you a little more–and probably expect more than if they hired some agent they saw on a billboard. For example, I have cleaned up more cat and dog messes than I can count for friends who didn’t have time to make it home to clean up before a showing. I’ve also picked up disgusting dirty clothes, picked people up from the airport, driven them to the suburbs, and even let them sleep on my couch when needed.
The bottom line is, if you’re not prepared to go above and beyond for the people you have pre-existing personal relationships with, then this is not a good source of business for you. If the idea of working with friends leaves you with apprehensions, then focus your energy in other areas.
Over-Document to Avoid Disaster
Some people handle stress better than others. And anyway you slice it, selling or buying a house is a stressful experience for any client. Things are said, things are forgotten or misinterpreted, and in the end, feelings can be hurt and relationships damaged. Fortunately, there is an easy way to avoid this: over-document.
You should never conduct any business for a friend without having detailed and explicit direction in writing. This goes for counter offers (which often happen orally or via email after the initial offer is submitted), commission changes, or anything else that can be misinterpreted or otherwise come back to bite you in the butt.
I learned my lesson the hard way. I had a client who I had known for years, and we discussed multiple times during the process that she’d be taking the washer/dryer (which were wedding gifts from her parents) and replacing them with similar models. I assumed the expectation couldn’t have been anymore clear.
However, right before closing, the buyer’s attorney asked why those items were missing during the final walk-through. My client suddenly had amnesia and denied ever having a conversation about replacing the washer and dryer. In fact, she was adamant that I had committed to giving the buyer a credit for these items out of my own pocket.
What were my choices at that point? Because I’d done such a poor job documenting the transactional details, I had no choice but to give up $1,000 of my commission to cover the cost of the credit so the deal would close and I could salvage the relationship with my client.
The lesson here? Documentation and organization are key to being successful with any type of transaction, and become even more essential when dealing with clients you have a relationship with.
If you have a strong network, leveraging personal relationships to grow your business can be one of the best paths to success. But it doesn’t come without risks. To effectively work with friends, it’s important to treat them like all your other clients, expect to go above and beyond, and over-document to avoid damaging either the professional or personal relationship. Follow these tips and you can make working your personal network a key part of your success in 2014.
By Scott Newman
So you’ve made it through the worst of the real estate bubble, you’ve developed a nice client base, and you’re taking over the entire industry – great! If that’s the case, then this blog isn’t for you.
Instead, this blog focuses on what we as veterans of the industry can share with the newbies to shorten the learning curve and help create another reputable professional who gives our industry a good name.
The following are my top three “I wish I knew that when I first started” tips to make your transition into a real estate career as painless as possible.
1. Simple Math
So many real estate agents come into this business thinking of the riches they’ll make selling homes for a living. Many even come up with lofty goals for themselves, “I’m going to make $200,000 my first year in the business.” Does that sound familiar?
Well, the problem is that most agents don’t stop and break down the math behind creating that kind of volume. They end up focusing on the big picture when it’s the attention to the little details that will create the success they desire.
For example, let’s say you’re new to the business and don’t know a lot of people, and that the average home price in your area is $200,000. Simple math tells us that you will make $3,500 per transaction at that price, assuming you have a 70/30 split. At $3,500 per deal, you’d need to complete 58 transactions a year to make your $200,000 – that’s more than one house a week, which is a large volume even for a veteran real estate pro.
Let’s break that down further: Let’s say you have to talk to 20 people to get one client and earn that $3,500. That means if you want to sell a house a week, you need to get in front of 140 new people a week in a meaningful way to meet that goal – or 6,720 people a year.
What does this example prove? It simply demonstrates that for a new agent who has no other way to get new business–without spending money–to expect to meet their goal of $200,000 would be unrealistic.
Instead of setting themselves up for failure, if the person in this example had taken the time to break down the math on what it would have taken to meet their goal, they most likely would have set a more realistic goal that would put them on the path to success.
2. The Power of the Word “No”
When I first got my license, I would have taken on any client who was willing to get in my car or take my phone call. I said yes to everyone and everything that came across my desk. Why? Because I valued my time at $0 and figured anything was better than nothing. Unfortunately, that couldn’t be further from the truth.
Every time you make the decision to do anything in this business–take on a client, attend a seminar or training, or take the day off to spend with your family–there is an opportunity cost associated with that decision.
That opportunity cost is the lost income, connection, etc., that you could have made by being somewhere else instead of where you choose to be. This is where the word “no” becomes so powerful.
Think long and hard before you take on a client. Make sure that person is pre-qualified, cooperative, and serious about buying a home and sticking to a plan to get there by a pre-set date. Every time you take on a client who ends up being a waste of your time, you literally threw money out the window because you passed up the opportunity to work with real buyers.
When I mentor the agents on my team, I constantly remind them of two things in respect to this tip: 1) It’s better to take the day off and relax or do something enjoyable than waste it; and 2) When you meet with a client for the first time, it should be just as much about you interviewing them as them interviewing you. Don’t take on bad clients and you’ll make more money in the same amount of hours worked with no additional effort or expense.
Please say this out loud to yourself in the mirror every morning before you head to the office: “Just because I don’t get paid by the hour doesn’t mean my time isn’t extremely valuable,” and don’t ever forget it!!
3. Cooperation is the Key
I have to admit, I have a long, long way to go in restoring the damage I did to my reputation from when I first got into the business. I, as many agents do, felt that the only way to overcome my own lack of experience and knowledge was to be combative, argumentative, and in many cases, less than pleasant to deal with. I honestly thought this is what my clients wanted and expected and that I was being the tough negotiator they wanted.
Unfortunately, I had to learn the hard way that this couldn’t be further from the truth. Of course your client expects you to bend over backwards to advocate for their best interests, but you can absolutely excel at doing so without creating enemies.
The best weapon you have in your tool belt when it comes to being a successful agent is your reputation. If other agents like you, they’ll look for your name on listings, push your offers to the top of the pile on their listings when you have the buyer, and, in general, go out of their way to do business with you and your clients. The more allies you have out there in this industry, the more successful you’ll be–that’s a non-debatable fact.
Go out of your way to make friends, do favors for people, and do everything you can to develop a reputation as a fair, honest, and kind person, and you’ll do wonders for your bottom line.
This is a very tough business and it’s only getting harder. We all need to stick together to succeed. If you’re new, follow these tips–as well as other tips you get from successful veteran agents–and skip the learning curve. This will help you hit the ground running and minimize the time you need to put in to get your business up and running.
By Alex Milshteyn
I’ve attended the annual REALTORS® Conference & Expo since 2005. A lot has changed since my first annual conference, which also took place in San Francisco, but a lot has also stayed the same. Here is a list of some of my memorable changes:
- In 2005, I didn’t have in-flight internet. I am not sure how I survived 4.5 hour flight without checking e-mail.
- In 2005, I came to San Francisco with no technology. No iPhone, no iPad, no MacBook, no battery pack, no 3 chargers.
- In 2005, I carried a fancy silver flip phone on my belt.
- In 2005, I walked by at least four “Internet Cafés” from my hotel to the convention center. I used these cafés to check my e-mail only once a day.
- In 2005, the only “tech” sessions offered were training on how to use Microsoft Word, Excel, Publisher, and PowerPoint. I remember taking a class on how to create a listing presentation in PowerPoint. I was one of 20 REALTORS® that attended this class.
- In 2005, social media was non-existent at the conference.
- In 2005, Zillow and Trulia didn’t exist.
- In 2005, I bought my first package through realtor.com®, I agreed to pay them $300 per year to “showcase” my listings.
- In 2005, the conference registration cost $300. It was $400 for this year.
- In 2005, Dr. Phil was the keynote speaker.
- In 2005, the expo had “tech” companies that mostly included only website creators like z57 and iHouse.
A lot has changed in eight years. But also, a lot has stayed the same. The sessions on selling real estate are mostly the same; old school methods still work. Technology has made it easier for us to communicate but it hasn’t replaced us. I’m looking forward to the next REALTORS® Conference and Expo in San Francisco in 2019 so that I can report the changes that have happened since 2013.
Alex Milshteyn, GRI, ABR, is a REALTOR® in Ann Arbor, Mich., who runs a real estate team of five professionals called Alex Milshteyn Real Estate Associates. Connect with him at www.alexmi.com.
Members of the Young Professionals Network stood tall and proud at NAR’s 360 Thursday, waving U.S. flags in the air to symbolize their commitment to “10 for 10” – investing $10,000 to the REALTOR® Political Action Committee (RPAC) over the next 10 years.
Christian Zarif with Better Homes and Gardens Kansas City and Matt Case with Coldwell Banker Schmidt Family Companies in Traverse City, Mich. (pictured right) are among the more than 50 practitioners who have taken the pledge targeted specifically for young professionals.
RPAC funds are used to promote the election of pro-REALTOR® candidates. “This is the next generation of REALTOR leaders stepping up to the plate,” said 2013 First Vice President Chris Polychron during the REALTORS® Conference & Expo in San Francisco. To learn more about the “10 for 10” pledge, visit www.realtoractioncenter.com/10for10.
By Melissa Krchnak
Do you have a wig?
No, I’m au natural.
I’ve been learning about “The 4 Disciplines of Execution” and getting my Wildly Important Goal (WIG) figured out.
Oh, that kind of a WIG… Yea, I’ve got one of those!
Most of us do not have a problem coming up with great ideas. Hell, we could revolutionize our industry with all the awesome thoughts we have throughout the day. It’s the plan for execution we trip on. Yep, I’ve got those bruises, too.
So, figure out what’s your first domino: What is the “ONE Thing” that will make all your other little goals easier or unnecessary when you achieve it? That, my friends, is your WIG.
There are three other steps, which I will discuss in my future YPN Lounge posts. However, you have to build a rock-solid foundation before you throw up beams and a roof and call it a home. Nail the first discipline then move on to the second.
Melissa Krchnak is the team leader for Keller Williams in Pikesville, MD. Connect with her on Twitter @mkrchnak.
By Scott Newman
The market is recovering—in some areas it’s even a seller’s market—and that means sellers can once again be a little more demanding…and a little more unrealistic.
So your client is turning into a “sellerzilla.” What do you do when your relationship with the client is on the line, but you need to get your point across? Read on…
Show Them, Don’t Tell Them
If my seller client isn’t willing to listen to my pricing advice and they think they know better me, I prove to them that I’m right. But I don’t do this through arguing, CMAs, or anything of that nature. Instead, I utilize their own two eyes.
If your client wants to list for $275,000 and you know the house won’t sell for more than $240,000, schedule 45-60 minutes with your seller prior to listing their home and take them to see homes for $275,000. When your client sees that the homes in his or her intended price point are bigger, nicer, and overall more appealing, then you significantly strengthen your argument without having to risk isolating your client.
They say it takes 21 days of doing something everyday to make it a habit. The same concept comes into play with unrealistic sellers.
So you’ve done the CMA, shown them competing listings, but they still want to list a little high. Don’t worry, it’s not the end of the world! Make sure you don’t shy away from confrontation, and make it a point to call them once or twice a week and review the latest data and push for that price drop.
Let Them Hear It Straight From The Horse’s Mouth
No one wants to upset their client, but the reality is your client needs an adviser, not a cheerleader. That means sometimes having an opinion or giving advice will contrast to what your client thinks or feels is best.
Rather than risk damaging the relationship with your client by directly pushing for a price drop, instead try letting the buyers do your dirty work for you.
At my company, we made the decision a while ago to set up a feedback system, so anytime a buyer’s agent leaves feedback about one of our listings, it goes directly to both the client and us. This way, the feedback arrives unfiltered and will demonstrate that it’s not just you who thinks the price is off. These e-mails also serve as jumping off points for discussion about a price drop, which should help you got the ball rolling with those uncomfortable conversations.
Not every listing is going to be perfect. But by staying on top of your clients and following these tips, you’ll be able to circumvent the objections and concerns of unrealistic sellers and make listing property a profitable part of your business model.
By Adam Ailion
If you are anything like me, you are tired of hearing about the latest and greatest app you have to learn how to use, or the next best service to buy. My mind is going through “technology overload,” making it difficult to stay current — and many times a good idea or service may go unnoticed.
Let me start off by saying I am frugal when it comes to spending money on tools to grow my business. It might not always be a positive trait to have, but on the plus-side, if I buy into something it has to be good — so listen up.
Last month I was at a technology summit where a real estate panelist mentioned a new service called “FiveStreet,” which was revolutionizing his business by consolidating his online prospects. I have been on the quest for something like this for more than three years, so hearing that this product is available got me a bit excited.
If your business is anything like ours, we get 15-25 inbound leads a day. It has been a constant struggle to manually input all the data, respond to all online inquiries in a timely manner, properly track them to see where they all come from, all while being able to route them to the proper team of agents. We’ve tried our hand at various CRM tools, and we boast about being equipped with tools to serve our business. But one thing I have noticed over the years is that many of the CRM software providers don’t fully communicate with the real estate syndicate websites. There is always a missing piece to the puzzle. This FiveStreet service seems to be the missing piece of the puzzle that can tie it all together.
FiveStreet screens your Gmail account for online prospect notifications, and consolidates them into one database, regardless of their source. It then pulls their phone number and e-mail address and sends them an automated e-mail/text within minutes of their request, it also researches social networks for their accounts, and easily allows you to collaborate and route the leads to other team members. Best of all, it communicates with other major e-mail providers, as well as Mailchimp, BombBomb, Contactually, and Top Producer.
This has to be one of the most useful real estate services to come across my desk in over a year. We have been using this tool for about a month and we’ve seen great success consolidating online prospects, improving response rates, and getting insight into ROI tracking for premium paid advertising on the real estate syndicated websites.
As an advocate for new innovative ideas, I urge you to look closely at this service if you are having a hard time consolidating online prospects and quickly and effectively responding to them.
Adam Ailion is a managing member of the Ailion Team at RE/MAX Greater Atlanta. Connect with Adam at www.LocationLocationLocation.com, www.facebook.com/RemaxAtlanta, @atlanta_agent, or www.linkedin.com/in/atlantaagent.