Real estate office buildings are closing all over the country. Real estate agents happen to be hanging up their licenses atlanta divorce attorneys state. The traditional bricks-and-mortar real estate brokerage is usually hemorrhaging, and all that helps to keep this archaic business model alive is consolidations. As offices close, some agents quit, but the survivors move their licenses to another sinking ship, a ship that seems similar to the last one and often with the exact same name on the bow.
A big franchise office closes it’s doorways, no longer able to keep the lights on after greater than a year of operating in the red. The agents are worried sick, not knowing what they’ll carry out, until their savior walks in the door.
A broker from a large bricks-and-mortar across town with exactly the same franchise offers to take all of the agents in with the very same contract terms: each agent pays $600 per month and keeps 100% of their commissions. The brokers sigh in relief and swiftly sign the new agreements like sheep to the slaughter.
Since the broker can’t generate enough prospects for the agents, and because the agents aren’t selling enough to make the broker enough funds on commission splits, any type of split wouldn’t seem sensible for the broker nowadays. abbeyfields whalley A sharp agent will charge each real estate agent a monthly charge. He laughs completely to the lender, because with 60 agents paying $600 monthly, he’s making $36,000 per month just for living.
Three years ago I sat over the desk from a franchise broker who looked at me and said, “Well, we’re feeding the business enterprise every month. You have to do that when times are tough. But we have been through tough times before, and we always turn out okay.” I recall thinking to myself that has been a silly thing to state coming from a man who told me he had no business plan, no budget for marketing, no written vision for future years of his business. Unfortunately, that same broker simply just issued a press release he is permanently closing the doors of his bricks-and-mortar and you will be hanging his license with another bricks-and-mortar. Another consolidation.
This broker is only jumping from one sinking ship to 1 that hasn’t sunk yet. The new ship has plenty of leaks, and it may take a while for people on the Titanic to wake up. Bricks-and-mortar real estate brokerages that stubbornly won’t bridge the gap to an entirely home based business model will die a sluggish and painful death. It’s one thing for brokers to ride their very own ship down, but it is fairly another thing altogether for all those brokers to sell tickets to real estate agents with promises they can’t keep.
Probably the most unfortunate thing about all this is that the agents who think they are doing what must be done to survive are just re-arranging the deck chair on the Titanic. Many of them truly have no idea or comprehend how precarious their fate is certainly. Many of them do have a distressing feeling, plus they know something is wrong making use of their business model. Just like so many of the passengers on the Titanic near the conclusion who smiled and kept saying, “Don’t worry, everything always works out alright,” traditional agents continue steadily to greet people with a smile and await the phone to ring. However the ship is tilting, plus they are at risk. They just have no idea what to do.
This is the great issue of being stuck. It is the classic inability to think beyond oneself. Traditional brokers and brokers who have operated inside a traditional brokerage model for many years battle to think in entirely new methods. What makes this especially difficult for so many is their irritation with technology and the Internet. Some simply refuse to learn the technologies. I know of a top producer who refuses to adapt, and he sincerely believes he can delegate lots of the responsibilities to his assistant. Very few assistants are likely to spend night and day mastering and adapting for a boss, and when they do and abandon someday, where does that leave the broker? Even successfully delegating leaves severe difficulties in bridging the gap, that i will share later.
There’s been a huge change, however, not all agents and brokers recognize what is happening. Most do not comprehend that they are in the middle of a major earthquake. Therefore, they continue steadily to do what they always have done. Underlying all these changes is something very big that traditional agents are missing. Just as it is powerful forces that approach tectonic plates deeply below the earth’s surface, we are experiencing powerful forces resulting in an earthquake in the true estate world. As with so much in lifetime, what we see at first glance is merely an indicator of a deeper plus much more significant trend that is actually the driving force. It is this driving force that lots of brokers and agents have not recognized.
Here is the first tectonic force that’s at the root of all these changes effecting the real estate industry: a big change in consumer behavior. Granted, it is a huge change in consumer conduct. It’s so big with thus many implications, a lot of people don’t comprehend it.
The full description of the changes in consumer behavior would be quite long, but this is a brief summary in the context of the true estate business. Consumers are no more willing to be sold with obnoxious advertising and told what things to buy and when to get it. Consumers are sick and tired of interruption advertising, of billboards, of high pressure salesmen, of telemarketing, and of misrepresentations and boldfaced lies. Buyers have had it with expert conflicts of interest. They’re fed up with only getting partial information upon which to base their most important decisions. Customers want and demand freedom to control their own destiny. They don’t like being controlled. They don’t like being manipulated.
The second tectonic force effecting such dramatic changes in the real estate industry is strong in its own right, but also functions as a catalyst for the changes in consumer behavior.
The catalyst which has empowered customers and is forcing these improvements that are the death knell of conventional property brokerage is… advances in engineering.
The traditional brokerage business model has been totally unequipped to deal with these tectonic shifts. The affect of the real estate recession has accelerated this process to be certain, but only in time. Had it not been because of this recession, the impact of the changes in consumer behavior could have taken longer, however the impact would ultimately function as same. The recession has acted such as a diversion, however, distracting real estate agents from the real reason behind their doom.
I’m reminded of the newspaper salesman who attempted to sell me expensive print advertising recently. I ask him, “Why would I promote in the newspaper when it hasn’t sold some of my real estate listings in the past calendar year? Help me out. Why must i advertise in your papers?” His reaction while soft-spoken and polite, seemed to be of the same mindset as many real estate agents today, “Well, you don’t desire to be left out when your competition is advertising, do you?” In reaction to my blank stare, he pleaded, “When business is slow, it isn’t the time to avoid advertising. It’s the time to advertise more than ever!” That’s when I possibly could no longer include myself, and I broke out laughing. We used that range in sales 30 years back. Are they even now using that line? Yes, they’re.
Apparently, that kind of sales page still works with many realtors and agents, because like flies bouncing off the plate cup windows in a futile work to escape from bondage, many agents are still doing what they admit fails very well any more. Whatever we were doing that was not working before must be done twice as fast nowadays. If the ship you’re on is sinking, stop wasting time about your business and jump on another ship just like the last one. Such behavior can be insanity and a ticket to failing.
More real estate brokers have filed for bankruptcy protection during the past two years than at any time in U.S. Record. And the earthquake has not ended as many bricks-and-mortar brokers will be on the verge of closing their doors soon.
It is the early adopters of home based business models and new technologies who will be the millionaire realtors in the a long time. Because time will be truncated with the accelerating pace of the growth of engineering and the usage of the Internet, those who pause too long to take into account doing something will be left so far behind, they could never catch up. Think about a space ship entering warp speed. Those who missed the flight will see themselves light yrs behind their colleagues. This is one way it’ll be for traditional real estate agents who insist on staying behind.
There is an answer, and it means embracing technology, new marketing techniques, new tools to attain clients, and mastering the web as a powerful medium.