In working with all sorts of people as they navigate their way through the real estate market, I’ve often thought about that question. I see it in a couple of different ways, and I’ll explain it below.
- Buying a house is a product. So, a lot of times I’ll be talking with people who think that buying a house is a product. They’ll say something like, “My friend just bought a house”. Notice that there’s nothing in that sentence about the real estate agent. In this example, the real estate agent doesn’t exist, but 90% of the time they used a real estate agent to buy a house.
- Buying a house as a service. If you talk to someone in the market for a new home, a lot of the time you will hear something like this. “we are working with our agent to find a home”. This is most definitely a service. What’s the difference from number 1? It would appear that the service occurs before the event. It would be strange to hear “I bought a house when I used a real estate agent.”
What about when selling a house?
- Selling a house as a product. There’s often a tie in with buying a house. You’ll hear something to the effect of “We bought a house in Kirkwood after we sold our house in Affton.” There’s no real estate agent mention in that.
- Selling a house as a service. A lot of times you will hear “we’re getting ready to put the house on the market and our real estate agent has given us a lot of staging advice.” Oddly enough, did you notice that this also seems to happen before the event is finished? You stage a house before you sell it. You get advice on the sale of your home before you sell it.
Cheating with words
It would seem that it would be most appropriate to say that you utilized a service (real estate agent) to buy or sell your home (product). If that is the case, then it would follow that as real estate agents, we provide a service. In my opinion, then, the service must be the most important component to being a successful real estate agent. This is what I’ve always believed, and it’s how we’ve set up Deerwood Realty. This is an incredibly important distinction. If we are to give the best service, we aren’t ever going to rank in the top transaction lists for the year. It would be impossible because the level of service we provide each of our clients is unique. There’s only one of myself and Jan. When you look at the volume listers, they are built with scores of young, hungry agents, but not necessarily experienced agents. As I’ve mentioned before, real estate agents tend to disappear.
I’ve seen how the product vs service comparison works in real estate. Here’s an example. Let’s say first time homebuyers Matt and Kim want to buy a house. They ask their parents who they used 20 years ago and call that real estate agent. Matt and Kim have no idea if they are getting a good agent, and it’s likely their parents don’t know if they had a good agent or not either. After all, I’ve found that it’s REALLY subjective to talk about the best agent in St. Louis because it depends on what measure you are using. The highest volume agents during the real estate meltdown in ’07 were foreclosure listing agents. The volume of sales had everything to do with the market and very little to do with being the best agent.
Still, we have some “hints” at what could be a good agent. Here’s a few I’ve noticed.
- A good real estate agent tends to be on time. Crazy right? The idea that you set an appointment and the real estate agent actually shows up on time or they call in advance to let the person know they are running late. What a novel concept in 2019!
- A good real estate agent tends to tell you what they know, not what you might want to hear. I’ve always been uncomfortable telling someone their house is worth X. I know that the real estate market will be the ultimate arbiter of the price. It really depends on who we are working with. For example, some potential sellers have been to every open house in their neighborhood for the past 5 years, and they know the sale price of every house in the area. Those people usually have a very good idea or range of what their house will sell for. They are usually looking for confirmation from a real estate agent at that point. This contrasts with other sellers who haven’t ever been to any houses for sale in their neighborhood and come up with something so silly that you know it’s time to go. When you produce a Comparative Market Analysis, they are bound to be upset. Still, you are offering your professional opinion, and some of these sellers will take your advice when pricing their home for sale.
- A good real estate agent tends to dress like a professional. If you’ve ever been to a showing where there are multiple agents, you will know right away who is serious about their business and who is just looking to make a quick buck. If real estate agents can’t be bothered to dress appropriately, what makes you think they are going to take the time to negotiate on your behalf with any sort of vigor?
- A good real estate agent tends to communicate well. In my 10+ years as an agent, by buyer and seller communication preferences have definitely changed. 10 years ago, the phone call was king. Then we all went to email. Now it’s text. What hasn’t changed in all of this is your ability to communicate. Even in the texting environment, it’s important to be clear in your communication. I tend to save “lols” and “smh” for my kids, and not my clients. Also, can you imagine putting an offer on a home for sale and not hearing back from the agent for 2 or three days after? Neither can I! I know it happens though.
Selling A Service And A Product
Marketing your business as a real estate brokerage can be really tough. Real Estate ads can fail. Commercials tend to be full of inaccuracies. I think this is why many real estate brokerages go with a product centered approach even if they literally own no products! It’s even trickier to advertise your business as a service. After all, no matter what a real estate agent tells you, they aren’t doctors or lawyers. Buying a house is not a life or death decision. It may be one of the most important decisions that you make from a financial perspective, but there’s more to it than just financial. For many, people have an emotional attachment to the real estate they buy or sell. Ignoring that can be a terrible mistake as an agent.