With the deregulation of the MLS system a possibility in the near future, many discount brokerages have started to spring up, and are getting a great deal of notoriety. Why? Well – to save on commission of course! Why use a Realtor when you can list your home privately? That’s a very good question, and it’s really opening up the eyes of sellers are Realtors alike. I will not turn this into a “why use a realtor” piece, but rather try to offer my explanation of why they have come about, and what their role will likely become. You see – you could ALWAYS sell your home on your own; the first home was sold privately, as were thousands after it. Somewhere along the lines the need for some professionalism to this trade was needed, so regulatory bodies, proper training and licensing came in place. For a very long time, sellers were very happy with the results Realtors were getting – but then something happened. Some Salespeople began doing less and less work, putting signs up and then never being seen again, uploading listings on the internet and sitting idly by hoping for a buyer. You see, in my opinion, many salespeople got into this business thinking it was easy, and once you got your license you could put signs up all over town. Well, times have changed. Sellers started thinking, “I can do that!”, and you know what? They’re right! They absolutely can! It doesn’t take much work to put a sign up!
An interesting fact in my industry is that 5% of the Salespeople make 95% of the sales, meaning that an overwhelming 95% of salespeople make up for only 5% of sales! Some only sell a few homes a year, and some never sell any! I would argue that a large portion of that 95% is the portion that is simply putting up the signs and listings, and is the portion that has frustrating the home selling public, and has therefore brought this discount revolution upon themselves! The top 5% do not want these underachievers in our industry any more than public wants one to sell their home.
You see – the top 5% in Real Estate are true professionals. These people and/or teams have tremendous systems in place that provide sellers with a full array of services and really know how to get homes sold. Mark my words – no private seller can do the job that these top 5% can. The network, the database of consistent buyer/sellers, the brand power, the advertising budgets, the marketing experience and the negotiating skills of this 5% will bring more money to the table 99 times out of 100 than any private seller. In fact, Discount Brokerages don’t have issues with the top 5% because they know that professional results require professional intervention, and that money spent here is not a cost, but rather an investment– that is a tried, tested and proven FACT that either side will attest to. Discount Brokerages are not trying to argue that they can do better than the top 5%, but rather a portion of that 95% we speak of.
So what to make of these discount brokerages? You know what? I think they will take out a HUGE chunk of that 95% mass of Realtors, and leave the industry with two very simple selling models: 1) Full Service, Highest Achieving and Top Selling Professionals (the 5%), and 2) a few discount brokerages that will offer some combination-type packages to suit whatever the aspects the seller feels they can not handle on their own. This is a GOOD THING and is great news for everybody. For you – the selling public, because you will now have as many choices as you can bare, and for me – the Realtor, because there will always be a need for full-time, full service professionals to rely upon. Not everybody has the time, the knowledge, or the ability to do what I do – or what my other fellow professional Realtors do. The cream will simply rise to the top.
What about those Realtor’s that leave the market, having their piece of the pie eaten up by private discount brokerages? Guess what- many of them aren’t leaving the market, but are likely the very ones that are starting these discount shops! The business savvy ones are going to lead the pack to discount bliss, and yes – many will fall between the cracks.
Consider this: Farewell to the Average Realtor? Or Re-Branding of the Average Realtor?
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