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- How old is your ideal client?
- Are they married or single?
- Do they have children?
- What is their income bracket?
- What is their education level?
- What keeps them up at night?
- What are their dreams?
- Logo – Make sure that the imaging, lettering (if any), and colors that make up your logo are consistent with your brand messaging and communicate your brand instantly. Real estate branding logos must also be easily recognizable and stand out from the competition.
- Website – Get a real estate agent website that is independent of your broker’s or the one that they provide for you, to make sure your brand is just as visible as theirs. Plus, if you change brokers you will have to start all over with your content, design, and SEO every time.
- Slogan – Again, your slogan is key to communicating what you do, who you do it for, and why you are the best at it. Be sure that yours does all of that efficiently.
- Social Media Presence – Having a social media presence is a flat-out requirement to survive in the new landscape of real estate professionals. It offers endless opportunity for you to spread brand and initiate profitable relationships with prospects for free.
- International agents got 146% more leads
- Canadian agents got 65% more leads
- US agents got 27% more leads
- You get a professional, easy-to-use and customizable real estate website, which looks great and is Search Engine Optimized.
- You get excellent lead capture tools for your website, such as Custom Forms and Call-to-Action buttons.
- You get a WordPress blog of your own, where you can stake your claim as the local expert.
- You get single property websites, integrated CRM, automated email campaigns for lead nurturing, access on the largest real estate social media platform in Canada… the list goes on!
- a minimum age of 18-19 years
- legal US residency
- the completion of required pre-license education (courses related to the real estate industry)
- passing the real estate license exam
Building a lucrative real estate brand is essential to being successful as an agent in today’s overly competitive market. More and more agents are getting their license every day, which makes it harder and harder for an agent to stand out from the crowd and build a name for themselves.
The only way to really stand out as an agent is to buckle down and start treating your real estate business like an actual business, rather than an expensive hobby that sometimes produces returns. Every successful business needs a clearly defined brand, and your real estate business is no different.
But what is real estate agent branding? What does it look like and how does it really function to generate more deals? In this guide, you will gain a deeper understanding of the true value of a well-crafted real estate brand, how to build one, and what it takes to leverage your realtor brand into closings.
What is Branding?
Branding, in short, is the creation and placement of marketing tools that differentiate a business from its competition within the marketplace. For real estate agents, building a brand around your business is just that – creating and marketing materials that communicate what is different about what you do.
The most powerful real estate agent branding is all about creating a lasting impression. Placing your real estate agent headshot on a broker website simply does not cut it anymore. Branding techniques are about confidence and creativity. When you can translate what’s unique and amazing about you and succinctly capture it into words and pictures, that’s the most effective real estate agent branding there is. It is no longer enough to just say you are the best at what you do as a real estate agent, you have to prove it through your real estate agent branding. More on how to do that later.
Crunching the Numbers of Real Estate Agent Branding
45% of a brand’s image can be attributed to what it says and how it says it.
Think of your brand as your promise to prospects and clients. It is who you say you are. It is what you claim to do. It is the people you aim to serve. It is the manner in which you promise to deliver. Most importantly, it is the results that you achieve for your clients.
64% of people cite shared values as the main reason they have a relationship with a brand.
When developing and marketing your real estate agent brand, remember to keep your clients’ and prospects’ motivations in the forefront of your mind at all times. Build your real estate agent brand around what you can do for them, rather than what you want them to do for you. That fundamental value will build true believers out of your prospects and help to foster a relationship with you that is built on trust.
80% of consumers are more likely to evaluate solutions from the brands they follow on social channels.
The internet is the first place most buyers and sellers begin exploring the idea of buying or selling a home. Many of them select an agent that they have a relationship with through social media channels. That’s because they’re already exposed to the content that agent shares and they feel a connection to their brand.
The beauty of using social media in your real estate agent marketing is that it allows you to reach both a broad and targeted audience base with your branded content that will appeal to people who are ready or are considering a real estate transaction.
72% of marketers think branded content is more effective than advertising in a magazine; 69% say it is superior to direct mail and PR.
Original, branded content is an effective way to build your agent brand, as well as to communicate it to your audience. Regularly creating evergreen content as a real estate agent was once a cutting edge technique used by only a few. Today, it has quickly evolved into a requirement for any real estate agent who wants to build a strong brand, as well as, a web presence. Since most buyers and sellers are shopping for real estate agents through online searches, having a strong web presence can be the difference between being a mega-agent and being a broke one.
How to Define Your Real Estate Agent Brand
The first and most important step in defining your real estate agent brand is selecting a profitable niche that makes sense for your market, to build your strategy around. Although it can feel intimidating to choose a niche because you may feel as though you are alienating potential prospects, the truth is that you will simply be better targeting your ideal clients. In fact, that is what selecting a niche and building a brand are all about, providing yourself with the opportunity to work primarily with your version of the ideal real estate client.
Once you have selected your niche, it is time to research your prospective clients thoroughly in order to gain valuable insight into what their problems, aspirations, and motivations are. The easiest way to do this is to ask yourself detailed questions about them in order to create a client profile. Here are some sample questions you can use to research your niche and develop a profile that you will use every day in your real estate marketing and branding efforts:
After you have developed a firm grasp on the demographics of your ideal clients, you will be better prepared to carve out a unique agent brand that is tailored to appeal to them, so that they are compelled to hire you when they search for a real estate agent online.
Creating Clear Branding Messaging
Where many businesses fail in their branding efforts, is the manner in which they communicate their brand to the public. It is not enough to simply create a real estate agent brand that serves a profitable purpose, it must also be clear and easily understood within seconds. Your prospects should be able to look at any piece of your real estate marketing materials and branding, and know right away what service you provide and who it is meant to serve.
Sometimes, when you are developing a real estate agent brand on your own, it can be easy to allow your brand messaging to become clouded because you can’t see the forest for the trees. Social media is a great tool that you can use to test your real estate branding and marketing materials while they are in development, in order to get constructive feedback and criticism from those in your target market. You may also want to post drafts in social media groups filled with professional advertisers, content managers, and graphic designers to get a more professional perspective on your materials before you pay to promote them.
Building Brand Awareness
Once you have defined what your agent brand will be and developed a brand message which clearly communicates what you do, and how you serve your ideal clients better than the competition, it is time to get your brand in front of your target market. There are both traditional and modern materials that you can use in order to get your brand out there. Here are some common tools that you will find essential as you develop your real estate agent brand awareness:
If you don’t possess successful experience in using these real estate branding and marketing tools, it is best to hire someone that does. Remember, your job is to get from contract to closing, so it is okay to admit you’re not a marketing, graphic designing, web programming genius. Allow professionals that are experts in those areas to build you up as an expert in yours.
Telling the Story of Your Real Estate Agent Brand
The other component to building awareness of your real estate agent brand is to tell your brand’s story. Storytelling is an art that has the ability to create a deeper connection with your target audience. The very principles of brand storytelling are closely related to word-of-mouth, social sharing, brand perception and social media for real estate agents in general.
This is another area in which that profile you created about your ideal clients will really come in handy for you because your brand’s story should be a longer-form content piece that explains all of the elements of your brand as an agent. For example, let’s say that your niche is aging couples in the 12345 area code that want to downsize by selling their larger home and moving into a smaller house, apartment, or even facility. You can create a story around a couple that was struggling with the hassles of managing their large property in that area code until they found you on a certain medium, and you got them the most money for their house to supplement their retirement, found them the perfect smaller house for their needs, and now they have more time, money, and freedom to enjoy their lives.
You can actually develop a whole series of brand stories that communicate the unique value that you offer your ideal clients in order to appeal to more of them. Translate those stories into multiple forms of content like articles and videos and distribute that content to the decision makers in your niche. The best part is that you will be able to use and recycle those stories for years to come to attract new clients.
Positioning Yourself as an Expert
The final key element to developing a profitable real estate agent brand is to ensure that your brand and all of your brand messaging positions you as an expert in your field.
Do not waste your time and money on real estate branding and marketing materials that make you look like just another real estate agent. Go above and beyond to create materials that make you look like the real estate rock star. All of your real estate branding and marketing materials should come together to create the perception that buyers and sellers would be lucky to work with you, rather than the other way around.
When you take the time to carefully choreograph a real estate brand that makes sense for your market, fuels your passions, and effectively serves a profitable niche, you will be able to crush it as a real estate agent. Suddenly, you will notice more and more people chasing you down to ask you questions, talk real estate, and hire you to work for them.
The best part? The clients you target with your real estate agent branding will be the type of clients you actually enjoy working with, rather than ones that make you want to pull your hair out and return to that nine to five job you had. Invest in building a profitable real estate agent brand now, and you will reap the rewards for the rest of your career.
This is a guest post by Caylin White, personal finance blogger.
People are getting more and more tech savvy, and millennials are at the forefront of this trend. For example, their workplace demands and expectations are currently overhauling the way work gets done in offices everywhere, and their unique skills and values reflect into their expectations about real estate.
On the flip side, millennials are also considered more unpredictable. As compared to the previous generations — who were more drawn to a stable career, security, and formal structures — millennials are perceived as averse to formal structures, and less driven by security when planning their careers or in their spending and savings patterns.
The majority of these perceptions are just myths. These opinions follow millennials into the real estate space, creating misconceptions about their interest in homeownership and even their ability to enter the market.
Below are six of these myths, and the reasons why they should be considered just that and nothing more.
Myth #1: Millennials are Resistant to Settling Down
One of the common myths about millennials is that they don’t want to settle down. This isn’t quite true. According to the RISMedia, quoting National Association of Realtors data, the median age for first time homebuyers in 2015 was 31, not much different from what it was in the 1970s, when the average was 30.6 years old. In fact, over a span of 40 years, the age at which people begin purchasing houses has more or less remained unchanged.
And since the oldest millennials are currently in their early 30s, this means that a significant number still remain well below that average age of entry into the homebuying market.
Myth #2: Cultural Trends Have Kept Millennials from Homeownership
A study by Fannie Mae, from August, 2016, blames the 2008 Great Recession for the small number of millennials becoming homeowners.
During this period, the number of homes owned by people aged 25-34 years was 10% higher than it is today. Rather than any cultural trends, it’s more likely that the economic downturn and ongoing financial uncertainties are what have caused millennials to delay their entry into the real estate market.
Myth #3: Marketing to Millennials is Fundamentally Different than to Other Groups
The limited participation of millennials in real estate has resulted in a common belief that the real estate marketing required to reach this group must be different than that of previous generations.
This isn’t necessarily true. As with any successful marketing plan, correctly identifying the demographic is the first step. Remember that two-thirds of millennials have yet to reach the average age of first time buyers, which is around 30-31.
Nurturing potential homebuyers on the long term will be more effective with millennials, because it will resonate with them when they reach the house buying age, a few years from now. And that long-term marketing will pay off: at that time, millennials are predicted to impact the real estate market significantly. Make sure you cater to their expectations with a well-designed, responsive real estate website.
Myth #4: Millennials Are Not Interested in Buying Homes
The limited comparative participation of millennials in the real estate market has resulted in the view that they’re not interested and don’t plan to buy houses. This perception is a myth.
Fannie Mae reports that 90 percent of people between the ages of 18-39 say they want to buy a home at some point — it just might take a while.
Myth #5: Student Loans Deter Millennials from Buying
While the rising volume of student debt (up 50 percent over the past decade) has been associated with decreased homeownership among millennials, there’s no proof that this is the case.
In fact, a 2015 study by TransUnion, showed only a 3 percent difference among real estate buyers with students loans and those without.
Myth #6: Homeownership is Lowest among Millennials
The situation is that homeownership is low among all age groups, and not just millennials, following the 2008 Great Recession. Nerdwallet quotes data from the National Association of Realtors to show that ownership in general has declined across all age groups.
In fact, the rate of homeownership in the United States was down for the eleventh consecutive year in 2015.
Caylin White blogs about personal finance and investment strategies at Stock Hax. Follow Stock Hax for trading news, tips and tactics, and grow your wealth.
This is a guest post by Casey Abernathy, from our friends at CyberKazoo. He’s a website builder, tech trainer and IT project manager.
The main goal of investing in a real estate website is to get more leads and close more deals. Sure, it can help improve your online image. It can give you a chance to show off local knowledge and industry achievements. It can also be a platform to extend your inventory, and to include that of other trusted REALTORS© in the region. But its main goal, the most important one, is helping your business grow. That is why you need to optimize your website for search engines.
I’m a Real Estate Agent, Do I Really Need SEO?
An investment in SEO helps ensure that your realty site gets maximum exposure to potential buyers. Odds are, your site is already linked to an aggregate service such as Point2Homes, or a local MLS. Although these larger sites will often feed traffic and leads to you, it is important to make sure that you offer your users relevant content, links, images and other elements to engage them, once they arrive at your site.
Good content with quality SEO will not only help attract customers to your agent website, it will help get them to come back. It will also help to harness some of that traffic from other portals that you are linked to, and make sure that you get credit for it.
What is SEO and How Does It Apply to My Real Estate Website?
SEO is Search Engine Optimization. With good SEO, you’re giving Google, Bing, Dogpile, Ecosia, and other search engines the right basic information about your real estate website. This information helps people who are performing a search in your local area, or half a world away, find you first.
SEO info will naturally include a few basic details, such as your location, and the type of service you are providing. It also includes more specific things, like keywords that you must use effectively in your content, meta descriptions, and meta-titles for each page. These pieces of information might not seem like much, but they can make the difference between whether your site is thriving, or is invisible.
A real estate agent website is like most other sites. It has pages that share background and area information, pages that offer products (homes, rentals etc.), and pages with background info on the company and team members. It is important to remember that people could search for any one of these things.
For example, have you taken the time to make sure your SEO for basic terms such as [My City] real estate is optimal? How do you rank for more specific terms like Condos for sale in [My Neighborhood]? There are lots of keywords and phrases that people will search for, when they are looking for a new home, or a local expert. It is important that your strategy takes all of these into account in order to perform better than your competitors.
Search Engine Optimization: Where Do I Start?
Know What Your Visitors Are Looking For
There is no substitute for research. Taking the time to identify and prioritize keywords will take you a long way. While some keywords may have higher search value, they are also likely to be more competitive. This means it will be harder to get to the top of the search results page.
While competing for the main market terms should be a part of your long term strategy, there are other keywords that will help generate traffic and organic reputation in the short term. Take the time to search out every term for your business. There are likely several that are missed by competitors, but still searched by potential clients.
Certain sites offer free tools, like SERPs Keyword Rank Checker. Just type in a few keywords for your market, and enter your URL to see where you rank. You can even search based on a specific location to focus on a target market.
Get a Good URL
A good URL will make it easy for Google and your potential customers to know what you do. For example: http://www.puertoricohomes4sale.com/. Can you guess what that site is for?
The idea is to remove all doubt and establish confidence before asking the user to click. A good URL should be simple and straightforward, so people will intuitively click on it. The more users clicking, the more reliable your website will look to search engines. No wonder PuertoRicoHomes4Sale is one of the top performing sites in Puerto Rico. Feel free to take a look at some of the other internal pages to get an idea about why it does so well.
A bad URL does not clearly imply what the site is for. For example: AgentName.com. Although your name might be good as a domain for an online resume, or a portfolio, it is not necessarily good for a realty site. Unless someone knows you personally, or is searching for your name, they will not be impressed by that URL in the search results, and fewer clicks means less search engine authority.
Use SEO Best Practices
Search engines want to send their users to the best possible site. But how do the search engines know which sites are the best? A good site will have links that point to it from other reputable sites. Think of these as references on a resume.
The site should be easy to navigate. This means that it should have a menu that points to all major pages. You can also link to other pages within the content itself. This is useful when you mention varied specific topics such as price ranges, neighborhoods, or a specific housing type like single-family detached homes or condos. Making it easy for a user to click from one page to another is essential to SEO.
Some of the most important aspects of SEO optimization are keywords and meta descriptions. When a stranger performs a search for a term, it is important that you either use that term, or a close variation of it. This is especially true on the pages in your website where the user is likely to find the content they’re looking for.
You should also use that term in the meta descriptions for those pages. This will help both the search engines and your potential clients identify that your site has exactly what they are looking for. To complete the connection, use part of the meta description and the keyword, or key phrase, in the page headers or at the top of an opening paragraph.
Stay Away from Bad SEO Tricks
There was a time when you could trick a search engine. Keyword stuffing, blind redirection to other sites, links on unrelated pages, and shady data collection methods were common practices. Thankfully, the internet has evolved.
Google and the others are now smart enough to tell the difference between a good site and a bad site. Google has a list of black hat (bad) practices that will get you penalized, and white hat (good) practices, that will yield rewards in terms of SEO.
Want to learn more about good and bad practices in SEO? Check out this blog article on real estate SEO best practices.
Boosting a Realty Site in a Competitive Market
You need to make other efforts and investments to draw traffic to your site. Even franchise real estate companies will feed traffic to their local pages from a blog or social media. Many use AdWords, email newsletters, and other methods of targeting an interested audience.
Once your real estate website has solid SEO, the search engines will credit more and more traffic toward your ranking for page specific keywords.
I’m not Tech Savvy, Help!
If you’d rather just stick to selling houses, we understand. Taking the time to learn SEO, come up with a strategy, and create content is a lot to take on. Lucky for you, there are service companies that exist for this reason. Our friends at CyberKazoo happen to run one of them.
As we all know, nobody looks on page 2 of Google search results. So, take a look at what CyberKazoo have done for others, and what they can do for you:
Casey Abernathy has worked in technology for over 10 years building websites, testing and training users in custom software applications, managing projects and serving as a translator between technical and non-technical stakeholders.
He presents at live events and webinars and will be guest speaking at an upcoming real estate conference in Cabo, Mexico in May of 2017. More of his work is available on the CyberKazoo Blog. Connect with him on LinkedIn, or at the next CyberKazoo Webinar.
Point2 Homes, one of the biggest real estate platforms in Canada, just got bigger, reporting a record-breaking 4 million visits in March. That’s a 25% increase year-over-year.
Other areas covered by Point2 Homes – US and International markets – have contributed to this surge in visits as well. As you know, more traffic means more exposure, and more leads. Here’s an overview of the record-breaking stats:
In the April press release, Point2 Homes is proud to report that it increasingly established itself as the preferred platform for home buyers in Canada, with an additional 629,000 visitors browsing the website for their next home, compared to last year.
The portal keeps growing at a fast pace, setting a new all-time-high number of visits per day – 158,500 on April 18th, 2017. It’s hard to beat the exposure 24.6 million page views per month brings to your listings.
Significant growth was reported on the US (7%) and International markets (35%) as well, including increased searches in Costa Rica, Puerto Rico and Mexico.
What does this mean for agents and brokers? Simply put: more leads! Point2 Homes referred 54% more leads to agents in March, compared to this time last year. Have a look at the percentages when broken down by market:
Are You and Your Listings on Point2 Homes?
If you and your listings are not already on Point2 Homes, now is the time to jump on the success train! Become a Point2 member and get priority placement for your listings, on Canada’s fastest growing real estate platform.
Once you’re a Point2 member, Point2 Homes becomes part of a massive online real estate marketing toolkit you’ll have at your disposal, which includes of to $6,000 worth of Featured Listing and Featured Agent Ads, proven to greatly boost leads for agents.
Yet More Benefits for Agents and Brokers New to Point2
As a Point2 member, your success in the competitive real estate market is our business. Here are some of the extra tools you’ll have to achieve that success:
Already on Point2 Homes? Congrats! Here’s How You Take Full Advantage
If you’re already a Point2 member – thank you for being part of our success! Point2 Homes has been growing so fast, you may want to take advantage of the platform more.
Along with priority placement, you now get free Featured Ads with your Pro or Elite accounts, for your listings and for your own agent profile, which can increase your lead count 4 times if you’re in Canada or International markets, and 15 times if you work in the US.
If you’re an agent in the US, your listings now appear on the Spanish version of Point2 Homes as well, which registered a 68% traffic increase since it was launched, in January 2017. Spanish is the second most popular language in the US, and tapping into that demographic with a powerful real estate search portal is a wise decision for agents.
Now is the time to join Point2 and get your listings where leads are looking! Start a free trial now and see for yourself!
You were looking for an enticing career – one that provides you with a solid income, freedom and flexibility – and decided to get a real estate license. Excellent choice, great timing: the real estate market in the US looks more promising than ever. In the last quarter of 2016, real estate prices in most metropolitan areas reached new record highs, says the National Association of Realtors.
Before you get too excited, remember that you must get your license to start reaping the long-term benefits of a rewarding career in the real estate business. We’ve compiled a list of requirements and essential steps to help you start off on the right foot.
Know your basics
Regardless of the state you’re based in, you have to meet certain general requirements, the details of which may differ slightly according to state. They include:
In addition, in most states you can expect to be asked for a high school diploma (or an equivalent General Education Development certificate) and you may have to go through a background check that includes fingerprinting.
Get educated on real estate
Various states may have different requirements in regard to specific real estate education. While most states ask for less than 100 hours of pre-licensing education, and some even less than 40 (Massachusetts 24, Kansas 30), in Colorado you must cover no less than 162 hours of education.
At the same time, many states offer amenities regarding real estate education. For instance, you can skip the required real estate courses if you have completed law school or passed the bar exam. However, you’d still be wise to learn all you can about real estate agent websites and online marketing – the business is very competitive after all, and you need every edge you can get.
Once you have completed the education requirements and your application was processed, you can take the real estate license exam. This test is usually multiple-choice, composed of two sections:
- Section 1 has questions related to national issues
- Section 2 usually focuses on state-specific issues
While this is a general overview of the process, expect to find a fair degree of variety in terms of number of questions and required number of correct answers, depending on the state.
Real estate license cost and requirements
You got the idea: the cost of getting a real estate license – time, effort and money – differs from one state to the other. As statistics show that Dallas-Fort Worth and Houston were among the hottest real estate markets in 2016, let us take a closer look at how you get a real estate license in Texas and what cost the real estate license entails.
Specifics: The Real Estate License in Texas
In Texas there are three basic requirements:
- You have to be a citizen of the United States (or a legal resident)
- You have to be 18 years of age or older,
- You must have your residency in Texas.
In terms of education, TREC (the Texas Real Estate Commission) requires the successful completion of a minimum of 180 classroom hours of specific qualifying coursework on:
- Real estate principles
- Law of Agency and Law of Contracts
- Promulgated contracts
- Real estate finance
You can take the pre-license courses at a community or junior college, at a university, or at commission-approved real estate schools. You can also look at the courses offered by local associations of realtors, so long as they are approved by TREC.
Texas real estate license exam: 110 multiple-choice questions
The real estate license exam in Texas consists of 110 multiple-choice questions, divided in two sections – national (80 scored questions, of which 10 percent involve math calculations) and state (30 scored questions).
You have 150 minutes (two hours and a half) for the national section, and another 90 minutes for the state section. In order to pass, you must answer at least 70% of the questions in each section correctly.
Keep in mind that the state pass rate for the real estate license exam in Texas is around 61% – so you’d better take it seriously!
A rough estimate indicates that the whole process – from enrolling in a course to getting the real estate license – may take three to four months, and cost between $800 and $1,200. The actual duration and cost depend mostly on the type of course you opted for – online or classroom – and, of course, on your own determination and energy.
Florida real estate license exam: State residency not required
For a quick comparison, in Florida – another hot market that ranks high in recent statistics, especially in Miami – the real estate license candidates must complete only 63 classroom hours.
The real estate sales associate exam includes 100 multiple-choice questions: 45 questions on real estate principles and practices, 45 questions covering Florida and Federal laws, and 10 questions requiring math calculations. To pass the exam you must answer at least 75 questions correctly.
The general requirements for getting a real estate license in Florida are fairly similar to the ones in Texas: you must be at least 18 years old, hold a high school diploma or equivalent, and have a Social Security Number. The notable difference is that Florida residency is not required.
Rewards: Motivating package, flexibility included
So you took your real estate licensing course and successfully passed your real estate license exam, either in Texas, Florida or elsewhere.
You have now become a real estate agent – a profession ranked by US News and World Report as one of the best five sales and marketing jobs in the US. With an average salary of $58,410 in 2015, and the highest earnings (the same year) of about $110,560, this is a job that is associated with an above average degree of flexibility and upward mobility.
Your new profession now offers not only the chance to start off quickly, work flexible hours and make a good income, but also the immense emotional reward of helping your clients navigate through one of the biggest and most meaningful events of their life: buying a home.
However, passing the real estate license exam is not enough for you to start enjoying these benefits and rewards, and to offset the real estate license cost.
License activation: the first step of your real estate career
The ink on your freshly printed license has barely dried, and you can’t wait to launch your career. The fabulous deals you’ve been dreaming about are just around the corner and you are eager to start negotiating them – to do that you must activate your hard-earned, real estate license.
This is an essential step that requires you to work for a certain period of time under the supervision of a real estate broker – preferably a well-established one, with solid experience and high reputation.
Brokers take responsibility for your actions as real estate agents during this “learning-by-doing” period, which normally takes between two and three years, depending on the state.
You don’t have to be employed by your supervising broker – you can enter different types of arrangements with the real estate brokerage where you undergo this sort of apprenticeship. Each brokerage decides how much you will be involved, as an agent, in the life of their office.
Some may ask you to spend a certain number of hours doing routine activities like calling people, or to organize “open house” events. Some will require you to go through additional training, while for others you can simply work from home – which takes a bit of know-how about real estate websites and efficient online marketing.
The financial arrangements during this period may also vary greatly, from splitting commissions evenly, to paying an annual base fee to the broker (without splitting commissions).
The future: Unlimited room for growth
Working under the supervision of a broker will help you acquire experience and improve your skills in the key fields of a real estate business: building a client base, using online marketing tools, advertising listings, assessing the property value, setting a fair asking price and negotiating an advantageous commission.
If at the end of this period you choose to become a broker, you will have to pursue additional training and take an exam for a real estate broker license. You will enhance your knowledge and learn to deal with additional issues like real estate investments, property management, construction and development and operating a brokerage.
Regardless of the path you take – whether you choose to establish and run your own brokerage, or to keep working as an agent or a broker for someone else’s brokerage – one thing applies to both options: you have unlimited room for growth. If you are well equipped with great personal determination, proper real estate marketing tools, energy, and a good plan, the only limit is the sky!
A recent CMHC report has raised alarms concerning overvaluation in real estate markets of several Canadian cities. We’ve reached out yet again to real estate consultant Jim Reid, who has been offering expert insights on agent strategies and Canadian market and industry trends, to comment on this concept, and to suggest some possible solutions. His insights are, as always, level-headed and piercing.
To what extent do prices of Canadian properties reflect their real value, and where do the major differences come from?
Many people who get their information from media reports, and even industry association spokespersons, feel that real estate in Canada is over-valued. Unfortunately, the vast majority of real estate information is presented with a positive spin, or statistics are relayed without revealing the range of values across the dominant heterogeneous product mixes in our industry.
Certainly average selling prices have risen significantly since 2008, but many people don’t understand that price and value are two different things. Price is merely the money (electrons) that changes accounts on a real estate transaction. Value is a much greater and more important in context.
It is only recently that Canadians have come to respect how little value financial investments can have. Inflation and deflation are creating great instability in monetary markets. Foreign currencies are being used to purchase not just residential properties, but also substantial acreage of land full of our natural resources.
Intrinsic value vs. fickle price
The intrinsic value of land and property has become so important to everyone nowadays because there are very few things with true lasting value in a modern economy.
This is why property homeowners often say they won’t sell at any price. People value their homes for their intrinsic value, not the price. There will always be a value for property and gold, but money can easily become worthless.
Rather than over-valued, people might consider whether the Canadian market is over-priced or under-priced. In fact, this would be a fruitless exercise as our real estate market is one of the most diversified markets in the world. It is much too complex to draw a common conclusion for the thousands of sub-markets in Canada.
Overview of Canadian real estate
To begin with, Canada does not have a national market with fixed prices. Every market marches to its own local tunes. Normal market forces push up prices in some areas and pull them down in other areas.
Sometimes a mass hysteria occurs due to external economic or political conditions that cause abnormal buying or selling behaviour. Massive people movements generated by wars, oppression, economic collapses, etc. elsewhere can temporarily drive prices sky high. But eventually, these settle back down to the general economic development real estate pricing trend lines.
Some popular markets will continue to experience population growth rates well above historical norms. Thus, property prices will remain high in these markets and they will have less downside potential. Those with extra liquidity will certainly drive prices up in popular areas, but the rest will tend to remain close to the long-term local market trend lines.
How the industry is contributing to the over-pricing myth
Real estate industry internal practices have also contributed to the over-priced myth. A relatively recent product pricing strategy has been a significant contributor to the public impression of over-pricing of Canadian real estate.
Self-inflating advertising such as “Sold 50% ABOVE ASKING PRICE” or “SOLD $200,000 ABOVE ASKING PRICE” creates the over-priced/over-valued image in the public’s minds. Yet these homes are very often artificially under-priced and actually sell close to their true market value price.
Another common industry practice is to assert that most properties sell in under 30 days. In fact, a large portion of them have been re-listed several times at ever-decreasing prices until the actual market value price is posted. This is not honest to the public and sets up high expectations for the sellers.
Perhaps the most important influence on Canada’s housing prices is the huge maintenance, upgrades and renovations sub-industry, which adds about $100 billion to our true property values each year. These are the homes that sell quickly at high prices, and pull up the averages for all others. Astute REALTORS® know such costs and value appreciation and should be able to correctly determine price values for their clients.
Of course, there are other factors that influence our prices, such as the need for four season housing and infrastructure. Our neighbourhoods require more investment than most other markets around the world.
When all is said and done, as long as Canadians need homes, and as long as market populations increase, there is no legitimate reason to consider our homes are over-priced or over-valued.
In a recent article you explained the difference between a bubble and a boom in real estate, and you stated that Canada will not experience a housing bubble. How should the market function in order to keep a healthy growth and avoid the risk of a bubble?
Canadians are making a mistake if they turn “bubble” into a generic term for high property values and prices. To avoid a “bubble”, Canada need only maintain its sound mortgage approval criteria.
What does “healthy growth” mean?
By this we might prefer to assume that further value increases are good, so maintenance, updates and renovations should be encouraged.
“Healthy growth” could also refer to an initiative to re-balance our housing mix in various markets, to closer meet the preferences of the demographic strata. This would not only take off pricing pressures, but it would also lead to innovations in creating affordable housing that offers the lifestyle choices the residents will enjoy. As our cities are now becoming “global cities” of “global cultures”, we must begin to envisage the new residences people will be owning.
The third form of “healthy growth” would be one where a responsible young generation will be financially able to acquire equity in a property and thus accumulate net worth for their family’s future investments. The family formation demographic in Canada needs immediate direction and guidance to be able to accumulate their down payments and then maintain their jobs and earnings.
This is not a simple state to achieve overnight, but it certainly can be enabled through prudent Canadian economic and industrial development policies, in conjunction with a motivated young work force.
Reality check and sustainable options for real estate
Of course, these comments are of little comfort to the responsible couple who have carefully budgeted and saved $10,000 last year. What hope is there, when an average Canadian home may cost $600,000, or even $1.2 million in certain markets. 6 to 12 year’s savings after inflation will turn into 8 to 16 year’s savings for a down payment on their first home.
Many of these homeowner aspirants could be thinking that if we indeed have a bubble, prices will collapse and wipe out our senior demographic’s equity as a cost of making homes affordable to them. But, I much prefer a more positive set of remedies for our “Centennials”.
The one market where supplies seem moderately plentiful is condominiums. They may not be as good at market appreciation as properties on the ground, but they do have location advantages in many places. Others may find suitable places to live in affordable areas they had never considered before. Young people who want to try a lifestyle for five years or so could find work in other places across Canada.
For those with a dream to own property, but unemployed, I can only say I have been there over 30 times since my first job. The secret to getting a good job is to like people, and let them know you like them and that you are happy to serve them. The second is to take inventory with a friend, of who you are and the skills you want to develop.
In other words, start skating, get your stick on the ice. The game has begun. Go Canada Go.
Last year, we began a series of interviews with real estate consultant Jim Reid, one of the most experienced and respected voices in Greater Toronto Area real estate. We’re happy to welcome you into 2017 with the second installment in this series, which started with a comprehensive list of advice and strategies for real estate agents. Focusing on market trends and generational issues in relation to the industry, Jim brings his wide-ranging perspective and acumen to bear once again.
How would you describe today’s Canadian real estate industry? Was 2016 a better year than 2015?
Canada’s real estate sales industry employs over 113,000 people, i.e. 0.6% of the national workforce. Canada’s (under-valued?) balance sheet has $24 Trillion in assets of which $6 Trillion (25%) is land and property. With a GDP of $2 Trillion, real estate accounts for 13%, i.e. $260 billion in 2016. Undoubtedly, we are one of Canada’s most important, diversified, competitive and well-regulated industries.
In my personal opinion, balancing supply and demand in our industry should always be a dynamic process where time and resources can adapt to changing market characteristics. However, well-meaning regulatory constraints and artificial incentives tend to become locked-in and thus cause abnormal anomalies across our industry.
Four current major anomalies would include: unheard-of price increases in hot markets, continued migrations into our major markets, corporatization of our industry and widespread millennial deferral of family formations in private housing. Adding to these is the short-term mindset regarding a New Vision for our industry.
We have also lost the flexibility of the post-war years of the last century and have greatly slowed down the pace of change and innovation in an age of more rapid changes throughout our society and its thousand cultures. One need only look at our past twenty years of experience in building new communities with less than 200,000 dwellings per year. The world wants in and we are not prepared to enable the potential growth and development that awaits us during this century.
Our industry needs a new Strategic Vision, yet we have nothing in place to define and plan a long-term vision. We are still trying to control our old paradigm, instead of creating a better one.
The tragedy of Fort McMurry’s burning may force new thinking for that city and thus reveal a dynamic new community. But they may be forced by existing regulations to rebuild the contemporary vacuum packed houses squeezed onto minimalist lots that pollute our landscapes. Canada’s risk averse mindset is not conducive to real innovative progress.
Of course, measuring 2016 against 2015 in a purely quantitative context will reassure those who think that more is better. Unit sales are up, as are prices, and possibly values. Our economy is presently driven by our industry more than any other. But digging below these surfaces, we find that costs to maintain our properties, pay our property taxes, insurance, energy needs and family lifestyles are rising much faster than our incomes. This is particularly true for our growing seniors demographic.
With housing and home ownership being such an integral part of the Canadian lifestyle and National Culture, we must take on these challenges to our future prosperity. Cities in Europe are mostly typified by absent landlords, and the majority of citizens are tenants. With over 60% of Canadian families becoming homeowners, we are indeed blessed by comparison.
Canadians tend to recognize that we are all unique and have different values and perspectives. Is there a reason why our housing can’t be equally as dynamic and progressive?
I had the privilege of raising my family in a community that contained over a dozen architectural styles. It also included a large neighbourhood where eight builders agreed to follow Georgian styling of the 1800’s and thus there were over 70 different models. Living in such an environment was a daily delight. In and around the small city of Kamloops B.C., I found many communities with a wonderful diversity of housing.
Perhaps the large cities need to look to our smaller cities for leadership in building Canadian style communities?
Do major cities establish a model followed by the whole country or can small cities live by their own rules?
Most certainly, the markets within the major cities and the markets within the smaller cities have somewhat unique and different mixes of markets. Thus, it remains important that smaller cities retain a significant latitude to design their housing and commercial models.
Many Canadians complain about the stereotyped malls and their “me too” brands that have driven vibrant local family retailers out after several generations of serving their communities.
This is due less to progress and more to our governments tilting the development market heavily in favour of well capitalized large corporations. This has also all but eliminated fair and vibrant competition across the nation.
People may not realize that our real estate markets not only reflect our different demographies, but also our different lifestyles and a thousand cultures. Local regulations concerning real estate development and zoning should be significantly different and all should be more tolerant towards small property owner capital funds and granted greater freedom (regulatory exceptions?) to do what they like on their properties (within reason).
When it comes to pricing, the difference in prices in the big cities vs. the smaller cities can be very significant, as we’ve seen in Vancouver vs. every other city in Canada. The big cities, which are becoming global cities, are more likely to attract wealthy investors. During times of economic and political turmoil, the rich will find that Canada offers a safer and more stable place to live or a “safe house” if they may need it.
Unfortunately, Canada has yet to discover the optimal longer term vision and planning processes that can adapt to rapid growth or rapid shrinkage in housing demands. Thus, anomalous pricing will inevitably occur.
An interesting trend has seen some of the large home builders who began in major city suburbia development, expanding their product mix into the smaller cities. In Barrie, Ontario, you get to buy the same 12 home designs and their mirror image models as were built in the mundane Toronto suburbs ten years earlier.
As a professional realtor, it is irksome that this sameness and lack of diversity is producing homogeneous markets with truly boring monotony of designs. For a country so rich in land, we have certainly produced far too many of our own ticky-tacky boxes communities.
We should likely blame our regulation-producing planning and development government agencies that have only approved stereotypical designs that meet their hundreds of requirements. It is understandable why builders just can’t afford to secure approvals for an endless variety of creative housing in Canada. Custom builders are now few and far between as most of them have moved into the in-fill market business, where they can build one or two of their approved designs in different mature neighbourhoods. We are victims of our own faith in stigmatic regulatory solutions.
The effect on our industry has been to design regulations wherein only large corporations can afford the lawyers and specialists needed to get their projects approved. This has created a corporate hegemony within our industry. Small family businesses just can’t afford to pay the upfront costs to get their one or two homes built each year. There is little independence and freedom left in our industry.
Canadians have responded by creating unique interiors inside our homes, but we may have to wait for a new small business vision for Canadian housing parameters and standards to release our Canadian creativity. (By the way, in neighbourhoods with one or two architectural styles, wouldn’t it be nicer if new in-fill homes were creative new versions of the original architectural period styles?)
During the next 25 years, our technology, communications and information age will bring even more changes to our cities and towns. Are we doomed to creating our own Stalag in the north, or will we find leaders who will introduce creative design flexibility back into Canada’s most important industry?
What are the most interesting market trends that you have spotted recently?
Having discussed the Cultural Trends in our industry in the previous blog, we might appreciate a look at the Seniors Demographic Force that is beginning to affect many of our local markets.
The place to begin is the Baby Boom in Canada stretching from 1946 until 1965.
“The baby boom lasted 20 years in Canada. During that time, more than 8.2 million babies were born, an average of close to 412,000 a year. In comparison, the number of births in 2008, when the population was twice as large as during the baby boom, was only 377,886. The average number of children per woman was 3.7 during the baby boom period, compared to about 1.7 in recent years.” (Source: Statistics Canada)
It is these 8.2 million babies, along with later immigrants (many of which will have reached the age of 65 by 2016) that occupy a 15% share of our national population. They are also our wealthiest demographic and own most of our industry’s real estate.
As these 5 million property owners approach 60, they begin to plan their later years. Most envisage a two person lifestyle with occasional overnight visits by their family members and old friends. During the next ten years, the lifestyle changes these people are contemplating will take place across our country.
Only now are markets beginning to better understand the wants and needs of these healthy seniors. They are quite different than their parents who tended to stay in their family homes or move into senior residences for “retirement”.
But “retirement” has a new meaning and paradigm for the Baby Boomers. It is anything but “retirement”. Most of these people will have active lifestyles and consumption patterns into their 90’s. That’s 25 to 30 years of either delightful existence or serious impoverishment and institutionalization as wards of our governments. Canada is not in the least ready for them.
Once again this demographic earthquake will be embodied within our industry. Their birth, birthed the industry we created today, and their remaining existence will significantly influence our industry tomorrow.
Our industry needs to understand these people and adapt to their needs. They are unlikely to buy a 600 sq. ft. condo other than as an important source of recurring revenue. They certainly don’t want to live in them, even though these sky-tents could be all they can afford.
But once again, their diversity will produce a large array of preferred housing options and markets. Our present housing mix is truly ill-suited to the majority of these people.
By examining some of their lifestyle options, and personal attributes, we can determine how the middle class majority will alter our industry’s composition.
Financially, 85% of seniors have a net worth of less than $600k (Statistics Canada). The average for this group is less than half this amount. Thus, cashing in one’s net worth and reinvesting in less valuable property equity is imperative. The CPP and OAS paid into during their working lives is far below their original expectations and even these will be clawed back if they live slightly above the true poverty line. But government funds will only cover food on the table and perhaps some heat, light, water and taxes for education expenses for other people’s children. Regrettably, many will not last long in their first retirement home and be forced into subsidized accommodations.
(Having recently produced some forward budgets for our personal senior lifestyles, there appears to be no way to maintain our initial retirement downsized residence and consumption patterns in the fast approaching era of a negative cash flow.)
The previous generation of war babies is only 25% technology dependent, but the Baby Boomer Canadians are likely 90% dependent. The costs of maintaining their technology devices and their personal or business travel requirements will be significant. The bottom line of these attributes is that city lifestyles will often be replaced by relocations into more pastoral or recreational areas.
Places like Collingwood, 100 miles north of Toronto, are already experiencing the senior movements. While Toronto experienced an over 40% increase in average selling prices in four years, this recreational property area had 28 to 38% increases in their two main markets. Communities south of there and into Muskoka and Haliburton have been calm, but the Boomers are coming. Similarly, all along Lake Ontario from Niagara-on-the-Lake to Port Hope, relatively convenient and spacious townhouses are beginning to feel the trend.
For the more prosperous members of this market segment, foreign fair weather destinations are welcoming senior Canadians in significant numbers. As seasonal renters and rentee’s, seniors are creating new markets in unexpected places due to our cultural diversities. (Note: Short term rental regulations are popping up all over Canada. These are certainly dousing many seniors’ financial options.)
During my career in real estate it was not uncommon for me to co-list second properties with realtors outside my major market. Having two realtor’s represent your client’s interests may become more acceptable going forward.
I encourage realtors to take the courses being offered to ensure you protect yourselves in regards to senior’s rights. But more importantly, you should start meeting seniors and get to know their hopes and aspirations and help them with their real estate financial planning for their next decades. Design your real estate websites accordingly.
By the way, we seniors are much savvier than you might ever imagine!
Want to learn more expert predictions for the real estate market in 2017? Read an expert broker analysis of the Edmonton market trends for the new year.
The Edmonton real estate market has been surprisingly stable in the past couple of years, even though the province of Alberta overall has been going through some significant economic turmoil. We were intrigued by this and wanted some 2017 Edmonton real estate predictions. We reached out to expert broker Sara MacLennan of Liv Real Estate. Her answers offer plenty of insight into this, and invaluable advice for agents.
Tell us a few words about Liv Real Estate and the role you are playing in it.
Liv Real Estate is a small but growing family-run brokerage in Edmonton. The company, founded in 1975 by Ken Johnston, was originally known as K.W. Johnston Real Estate. The Liv Real Estate brand was born in 2012 and reflects our focus on providing excellent service for our clients.
As marketing director, I provide our agents with the right tools to excel at selling real estate. I’m a REALTOR®, but I’ve never sold a house. I make our Brokerage easy to find and do business with. Today Liv Real Estate has some of the most visited websites in Edmonton, getting over 3.5 million page views/month!
Making Liv Real Estate this ‘visible’ online is not easy; we put in a lot of day-to-day hard work, building a quality brokerage, with relevant and useful content for our followers, and training agents to better educate their clients.
Have you spotted any interesting trends in the Edmonton real estate market recently?
As everyone knows, Alberta has been going through some tough times, but average home prices in Edmonton have remained stable since the recent peak in 2014. Average prices, however, do not reflect the prices of individual homes.
It turns out the average size of homes sold over the past two years has been steadily increasing. This at least partially explains the stable average prices in Edmonton while sales have been dropping.
While the value of most properties has declined, buyers still qualified for the same amount of money (up until the recent mortgage rule changes), and were able to buy larger properties, keeping the average sale price stable. Now that most buyers will qualify for a lower amount, the average price should start to decline.
In the past few months, have you spotted a rising interest in one particular area or neighbourhood? If so, which one is it? Why do you think this is happening?
In terms of online traffic, the newer neighbourhoods of Windermere and Summerside get twice as much traffic as any other neighbourhood on our site (10,000-12,000 page views a month). This is partly because they are large neighbourhoods with lots of listings, but also because they’ve been developed in a way to attract a variety of people, with properties ranging from affordable 1-bedroom apartments, to multi-million dollar properties.
There is a lot of interest in newer “infill” properties closer to Central Edmonton, but they are very pricey when compared to similar homes in newer neighbourhoods. Different buyers prioritize different things when choosing where to live.
What is the single most difficult part of a real estate professional’s job?
Time management. Time is a real estate agent’s single most precious commodity; wasting it costs money. Every agent needs to find a work/life balance that is sustainable, so the time that they dedicate to ‘working’ needs to be spent wisely. Make a business plan, write down your goals, know what you’re worth an hour. How much is saving $10 on a courier really costing you, when you have to hand-deliver a cheque across town, during rush hour?
What would you recommend to beginners in the industry?
When you start working on your Real Estate License, also start researching brokerages. Some brokerages may not want to hear from you until you’ve completed the course. Some will be eager to offer mentoring and training tools while you’re still studying, so that once licensed, you’ll hit the ground running.
There is a world of knowledge not covered in the licensing courses that you will need in order to succeed in this business. Find a real-life mentor, outside of the classroom, with experience in the Industry to draw from. When you’re considering joining a brokerage, talk to other agents that work there. Find out how much support and training new agents get before you make any big decision.
With over 15 years of Corporate Level and Residential Marketing Experience, Sara MacLennan knows exactly what it takes to make a great Real Estate Agent. The one imperative skill that is often overlooked, or not exercised to its full potential, is ‘marketing.’ As Co-Founder and Marketing Director of Liv Real Estate, she provides agents with the right tools to excel at selling real estate.
In an ever-changing market and a very stressful profession like real estate, sometimes it’s easy to lose sight of the importance of reflection and experience. The wisdom of a true industry veteran can do a lot to put things in perspective.
We’ve reached out to Jim Reid, one of the top real estate consultants in the GTA, and one of the few deeply passionate real estate practitioners and teachers. His thoughtful answers offer clarity and far-reaching perspective on industry-wide shifts and possible pitfalls. This is the first of a series of interviews with Mr. Reid.
Tell us a few words about your background in the real estate industry and about your current position.
I am not alone in choosing real estate late in my working life; however, people seem to come to our industry at all points in their working lives. Mine followed over 30 years in the private sectors.
By the time I reached my new career in Real Estate I was 53 and had started my second family. But I had a pretty full tool kit and only wanted to earn enough to help pay the bills, get kids through university and hopefully accumulate some RRSP’s and property equity. Our new lifestyle required ten deals a year to keep our heads above water.
My prior work experience was certainly diversified after graduation from McMaster: new MBA’s at Ford of Canada, McMaster Marketing Teacher, Partner in new motorcycle dealership (Kawasaki, Ducati), U of T Finance Teacher, Woods Gordon Mktg. & Econ. Consultant, Crazy David T-Shirts turnaround, Kearney Management Consultants, Peoples Jewellers (300 stores), Computer Innovations (28 Stores), DeBeers, (Diamond Monopoly), J. Walter Thompson (Advertising Agency), RPMS- Reid Project Management Services, Silent Gliss turnaround, Morse Jewellers turnaround, Canhome turnaround, Consumers Distributing (300 outlets) turnaround, Seneca College: Marketing/ Public Relations/ Sales Promotion teacher, Mr. Mom, Royal LePage – Your Community Realty, Jim Reid Realty owner broker.
As a technology first adopter for thirty years, I was ready to deploy the latest technologies and marketing innovations: cell phones, real estate software, real estate website development, home staging, virtual tours, etc… Through my Excel databases and Internet skills, along with professional Market Research experience in many other industries, I was able to keep an eye on our industry. An early government subsidized consulting assignment led me to research and analyze over 20 Canadian industries and assess their future opportunities for development. Industry analysis is an intellectual addiction for me.
When my license arrived, September 1995, I had no idea that I was totally unequipped for my new career.
My transition into real estate wasn’t what I had planned. It took me until my second year to find the 40 hours+ that were needed to stay in the game. My 20 hour weeks were a miserable failure. I didn’t even do one deal my first year (especially a personal disappointment for someone who had trained thousands of retail salespeople). But I did learn that it was foolish to max my line-of-credit on mass marketing techniques.
Adjusting our family lifestyle around prospect lifestyles is essential. (They prefer to meet with us on evenings and weekends.) There would always be plenty of down-time between hectic deal makings to enjoy an active lifestyle around the kids’ sports and development needs. But, it took me a while to accept that 70% OF MY WORK FOR PEOPLE WOULD ALWAYS BE “NO CHARGE”. However, often a deal materialized later and the bills got paid by September.
Even with my wife bringing in a very good steady income, when annual commissions bounce around from $30k to $150k to $70k to $250k, it became an art to manage our household financial affairs. Real estate “cash flow” has been certainly an intimidating roller coaster for my independent one-man-show. New career-Realtors© will be prudent to create and maintain family financial statements and budgets as well as learn Quick Tax software inside out.
Our reality is that life ambushes us all, competent and incompetent. I wouldn’t have been able to stay in this industry if I was “THE ONLY BREADWINNER.” Never under-estimate the risks in this industry. It includes lots of solid body-checks, but as long as you get up quickly and get back in the game you will score lots of goals.
Nowadays, it would be rewarding for me if I could help Realtors© make themselves more successful and professional. Perhaps I can even earn some money for a few toys (dirt bike, canoes, travel) by consulting to people wanting to fish in our complex and financially shark infested industry.
During the past twenty years, training and mentoring Realtors© was a privilege that I enjoyed a great deal. This is why I feel honoured to be an initial contributor to this new EXPERT INTERVIEWS blog from Point2 Agent.
What is the main reason why you joined the industry?
You really want the “Main Reason”? “This is the only industry an old divorced guy with no capital and no job prospects can have a chance at having some very good paydays in his senior years!”
I found myself aged 53 and ready to start a new career with zero net worth. In the past, there could be 500 applicants and I always obtained an interview and assumed greater responsibilities and rewards as a corporate wage slave. But at 53, the corporate and government doors closed as “Ageism” locked the doors shut.
The thinking went something like: following the most challenging and rewarding 5 year career of being Mr. Mom for two babies/ infants/ toddlers through pre-school, plus being the “House Mom” for my hardworking wife Terry, plus being Mr. Mom to about 15 local kids while their Moms went shopping and to the beauty parlor or gym, I’d better build a personal business working with the public.
The least resistance came from this industry. I decided to open my own doors in real estate. It cost six months and $5,000 to be in my own business as a private contractor for the brightest and best looking broker, oops brokerage, in Richmond Hill, consisting of about 60 realtors.
I stayed for 20 years, my longest career without being fired, until they had eight offices and over 800 Sales Representatives/ Associate Brokers. That proves I was right that as long as we have a pulse and a license a broker will take us on. I didn’t realize at the time, that being fired quite a few times was actually good experience for this industry where an active realtor gets rejected almost every day of their whole career.
That was my situation then, but my personal reasons for choosing this industry had more to do with lifestyle than money earning prospects. I wanted to share the business know-how and expertise I had acquired through my 25 years in truly exciting enterprises from cars and motorcycles to t-shirts and diamonds in the infancy of the technological age.
I knew that my business knowledge and skills mix would be valuable to my future clients in real estate. Mass merchandising techniques, in a mono-marketing industry, took some adjustments, but they did me well in selling properties.
Once I finally chose my real estate farming niche it took about 24 months to become the top producing person in my target market. I enjoyed giving farming workshops to new sales representatives (and a few senior realtor competitors).
Within eight years, we accumulated enough equity on our bungalow to do a major rebuild. Real Estate was the right choice for me and my family.
What are the most important factors realtors should consider when building their strategy?
One could write a book on this subject, but perhaps I can share the key character attributes that transport us towards our lifestyle goal to become Successful Professional Realtors©?
- Be humble servants with integrity, honesty and truthfulness.
- Use self-discipline to ensure we are always fit and qualified.
- Be permanent students of this industry.
- Create a Five Year Business Plan.
- Only consider our personal benefits after we maximize those of our clients
- Seek to understand the difference between truth and honesty.
- Under-promise and over-deliver.
- Be certain we and our clients respect family priorities.
- Give some of our time back to the industry.
- Knock on another door.
We will certainly succeed as Professional Realtors© if we consistently pursue these strategies.
Are small family businesses suited for the real estate sector or is the industry run by major companies and corporations?
In my centrist-free-enterprise-democratic-socialist opinion:
“This SMALL BUSINESS question has enormous strategic significance to Canada’s Premier Economic Industry.”
My perspectives and values place the creation of independent family enterprise far above the nefarious trend towards creating wage slave jobs for everyone. Corporatization economically enslaves humanity and it is a patronizing tool of the rich and powerful that stifles our creativity, positive motivations and family lifestyles.
The Real Estate Industry’s industrial heritage is “Independent Small Family Businesses.” This is a crucial Canadian industry that needs to fight hard to defend and continue this heritage. Allowing our industry to become the depersonalized, computerized, robotic, corporate oligopoly model would be an absolute denigration of our Canadian culture and lifestyle options. The consequences for our nation and its economic independence would be tragic. In my opinion, other countries already suck too much revenue out of our Canadian property markets and too much internal cash and capital flow is making the rich richer. We are one of the few remaining foundation industries for middle class growth and development.
Please don’t misunderstand me. I have been a significant contributor to corporate growth and development and these organizations have achieved great things for our societies and cultures. But, if we wipe out the family enterprises that are the seeds of corporate evolution, we open the iron gates of corporate dominion over all.
However, that being said, our Residential and Recreational markets tend to be driven by subjective significant personal feelings and emotions within our clients. There are many possible highly sensitive reasons for buying and selling property. It is important for real estate professionals to draw alongside our clients and become friends they can trust implicitly. Small business is the only entity that can deliver these kinds of intimate services our clients often need.
Commercial, Industrial and Investment real estate tend to subdue feelings and emotions and are often guided by profit, legal and other unsavory motives. Thus, corporate processes and their lawyers dominate much of these markets, although many individuals specialize in the large array of their sub-markets. This area of our industry is already accelerating into the realm of technological corporatization.
Internally, major foreign-owned franchises dominate the branding credibility of independent realtors, but they don’t fully control the small real estate family business practitioners’ finances yet. However, they do heavily influence the formation of high volume sales teams via biased recognition and award policies that distort the public’s opinion of who are truly the best realtors. In my personal experience, this certainly tips the balance in the “Listings” markets in favour of teams. Our infra-structure is less than conducive to the independent small family business model.
Externally, the business practice of Affiliation Programs between corporations in other industries and the payments of referral fees to non-realtor organizations has begun to drain revenues out of our industry. Some extra-industry businesses, with access to huge metadata information, are planning major incursions into real estate. Their owner-targeting processes will transform prospecting. Some realtors have already consigned over 50% of their commissions to be identified with mass media radio and TV shows flooding our industry.
Also, technology has created opportunities for all sorts of new services for realtors and clients within our industry. Online shopping is also rapidly penetrating our industry. We are in a CHANGE CYCLE where most of us will be morphing into “techno-realtors”.
The industry itself is rationalizing at a rapid rate as real estate boards fumble over mergers or unifications of databases. In our product market of extreme diversity, real estate Boards and Associations’ centralizations and standardizations lead to automation and homogenization of our services. They aren’t sure anymore if our industry would better prosper serving fewer practitioners and making the CANADIAN REAL ESTATE INDUSTRY a purely Corporate and Government Domain.
Government agencies seem to feel that because we are such an important industry to Canada, we must be regulated and controlled. The traditional common sense motto of “Buyer Beware” has now been reversed into harsh legal threats of “Seller and Realtor© Beware.” Government regulations always favour corporatization of businesses and thus stuffs our crammed law schools, binds up our free-enterprise and reduces competition. It also breeds corruption within an industry.
All of these trends rapidly add over-heads to the small family businesses and are gradually shifting the markets to the larger players. Our Canadian Spirit has always encouraged free trade, healthy competition and freedom to develop a business. None of these attributes exist anymore in the real estate industry, never mind too many others.
With hundreds of thousands of pages of regulations and laws binding our industry, it is pretty obvious where we need to start. Otherwise, the oligopolies now dominating most industries in Canada, and many other nations, will soon wipe out any opportunity to work somewhat independently in our industry.
Until independent contractors find ways to use technology to defend themselves against these forces, we will certainly have to face the real possibility of our extinction. I guess we are pretty special, now that we are on the “endangered species” list.
What’s the most important piece of advice for beginners in the industry?
There are many equally profitable pieces of advice. I want every private worker in this industry to succeed in creating a wonderful lifestyle for themselves and their family. Our industry works in harmony with members from all 1000 Canadian sub-cultures. At the core of our industry is cross-cultural social interaction. We have pledged to eliminate our racism and both peacefully and happily serve the public with the expert real estate services they require. If you can live by these standards, then you serve well your family, your industry, your community, your culture and your country with nobility. (Oops… too much cheerleading.)
I guess, “Knock on doors!” should echo in every heartbeat for the rest of your life. There are many friends waiting to meet you.
You should soon realize that the courses you took might keep you out of trouble from lawyers and government agencies, but other than being somewhat familiar with the paperwork, you weren’t given any training on how to do your job.
Thus, your TIME MANAGEMENT will be crucial to your survival and prosperity within this dynamic new lifestyle.
Redesign your hourly activities for the next week, every week, and cut out the hours you have been wasting on TV or the Internet. Research, Study and Train yourself like you would to run a marathon. Consistent designated hard work makes making money much easier.
The other integral ingredient is your Self-Confidence. Get your spiritual persona in order and never forget that you only need 10 deals to survive. If the market drops 20%, you still have 80% of the market to harvest, and your 10-deal market share is miniscule.
For those who stepped into real estate to pick up a few extra dollars for the family, I would say to them, “Choose to make this your full time career.” Otherwise, you will live in disappointment, do your clients a disservice, reduce the market for your real estate neighbours, and do the industry an insult to the profession. A half committed Realtor© is a person living half a life.
If you have a full tool kit of business knowledge and skills when you get your license, you may try to go it alone, but I usually recommend newbies to join a team. Hopefully you will find a coach instead of just a team leader with a megalomaniacal ego.
Lastly, turn your Sell, Sell, Sell mindset into: Serve, Serve, Serve!
Looking for more expert insights? Learn how to be invaluable to home buyers, according to one of Winnipeg’s top agents.
An agent’s attitude towards their job and their clients is often the key to successful transactions, and yet you rarely hear expert agent advice on how to improve that aspect of the work.
Market insights, the right marketing tools and experience are one thing, but presentation and a sense for the clients’ needs are the cornerstones of a solid reputation.
We’ve reached out to Walter Mota of DreamHaven Realty Inc., one of the premiere agencies in Winnipeg. With almost twenty years of experience as an agent and a broker, Mr. Mota is leading what has now become a family business, and has important insights to offer into the right mindset an agent must have in order to shine:
Tell us a few words about DreamHaven Realty Inc. and the role you play in leading it.
Ever since I started DreamHaven Realty Inc. with my father, Manuel Mota, 17 years ago, our mission has always remained the same. We wanted to provide the public with services that would include educating our clients about the real estate industry and the mechanics or procedures involved, to help de-mystify the terms and processes they can encounter when selling or buying a home.
What do you love most about your job?
I’m very grateful for the opportunities that I’m given each day to help clients realize their goals of purchasing their first home or selling a long-time residence. I get a tremendous sense of fulfillment when I see the impact my service can have on people’s lives. It comes with extreme responsibility and drives me to be as accountable and ethical as I can. The satisfaction of an accomplished goal is always worth it. Especially when it benefits others.
What would you recommend to beginners in the industry?
Be prepared to invest all of yourself in this business. Especially in the beginning. You must be willing to commit yourself to long hours and the time involved to educate and discipline yourself. It may seem to be a fruitless endeavor at times but persevering with a belief in yourself is how I was able to eke out a niche in the early years.
Don’t compromise your integrity for a sale. It’s never worth it. Your word is everything in this business and your honesty will pay dividends in the future. People appreciate it when you do a little extra for them.
I was and am still very fortunate to have a supportive spouse in Tara, who is also a professional realtor. Even before she started, I could always count on her patience and support.
What is the main challenge for the real estate industry at this time?
I think the real estate industry has been pretty resilient over the years and it’s mainly because people value good service and an educated opinion. My father faced challenges when he first started, over 40 years ago, but the bottom line was always about helping someone fulfill their needs.
Today’s real estate environment faces challenges from do-it-yourself advocates, and they can succeed at times, but overall and in the long term a knowledgeable and experienced professional guide will never become obsolete. Educating the public on the inherent value of our services is our daily challenge and attainable goal.
Do you have a current listing that you’re particularly excited about?
Actually, all of my listings are exciting. It never gets old, helping people. I would be lying if I said it’s not exciting to earn money after you’ve worked hard to accomplish your goal, but often it’s a by-product of that satisfaction I get from helping people get what they want. It can be draining and it always involves investing yourself emotionally, but the rewards are priceless.
What’s the most important piece of advice for agents talking with first-time home-buyers?
Tell them to visit your agent website! [laughs]
Tell them to balance their needs vs. what they want, to start conservatively and to do some research before they start looking for a place.
Recommend a trustworthy mortgage broker to help them find out just how much they can afford, to get pre-qualified.
Tell them to research a little real estate terminology to ‘get their feet wet’ before they start looking at homes. Parents are always a great asset for knowledge and guidance.
Offer to set up a market search in the price range they can afford, so that they gain some perspective on the market and how far their budget can go. Most importantly, be patient with your client.
Walter Mota has been a licensed real estate agent since 1997, and has founded DreamHaven Realty Inc. in 1999. Continuing his father’s 40 years of experience, he is a Multiple MREA Medallion Recipient (2005-2013-2015).
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