Standing Up for Agents

Here's a response I just posted on a blog that was talking about FSBOs.  Feel free to use it to explain your perspective to clients.  PLease give me proper attribution and a link to my website if you quote it.  Thanks!

 

Regarding FSBOs

I think the challenge is not in the offering of options or in who owns what company.  The challenge is in the comments above where people referenced the "useless"ness of real estate agents.  Everyone seems to think that selling property is easy.  The consumers believe it, and even many of the new agents who get into the business believe it.  That's why there's such a high turnover in our new agents.  No one, but those of us who have done this for years, knows how hard it is. 

Every year there are more laws put in place, more complications created, and more challenges to work through.  Especially now, as prices start to drop, people come after the agent's commission.  The problem is, that the agent has already taken a pay cut when prices went down.  They get paid as a percentage of the purchase price.  Plus, they're selling fewer houses, so they're getting it both ways.  And yet sellers still think that asking the agent to cut the commission further is the answer.  Agents work harder in difficult marketplaces.  They should be paid more, not less.  That's how it would work in other industries that are based on per-hour basis.

But the problem is that the consumer doesn't see the value.  They have no idea how much work goes in behind the scenes.  And that's the agent's fault for trying to make it a seemless process.  The better they are at their job, the less the clients appreciate how much work there was to do.  Agents need to let the client in on how much they are doing for them. 

There are many details that have to be handled in the standard transaction. 

1)  Pricing the home properly (a place where many FSBOs fail miserably)
2)  Writing good ad copy (which is an art)
3)  Posting information on the MLS that makes the house look attractive to the right buyers (another art)
4)  Creating and maintaining good relationships with other agents so that they are inclined to show your houses first
5)  Having great communications and problem-solving skills for dealing with issues that may arise in negotiations, inspections, loan approval, appraisal, etc.
6)  Being able to soothe bruised egos and smooth over ruffled feathers when emotions run high and risk destroying the sale for no good reason
7)  Having relationships with good contractors so that needed repairs can be done in a timely fashion so that they don't delay closing
8)  Having good relationships with town officials so that issues there can be resolved quickly

There are many other skills that come into play on only a few transactions each year, but on those transactions, these skills are critical.  Much of the work agents do is ongoing non-transaction-specific (like the relationship development and management), but they are still time-consuming. 

When you hire an agent, you're hiring them for their expertise in the industry, not just to put your house in the paper or on the web.  You are investing in the knowledge, experience, and problem-solving skills of that person.  A good agent can mean the difference between your house closing or the deal falling apart at the closing table when all of your possessions are sitting on a truck waiting to go to your new home which won't close because your house didn't sell.

Some FSBOs are experienced enough to do the majority of the work themselves.  Most aren't.  This is why 85% of them end up listing with an agent eventually.  The problem isn't the FSBOs.  It's the lack of appreciation for how much work it takes to sell a home and to keep the deal together through closing.

Kelle Sparta
Author of The Consultative Real Estate Agent - Building Relationships that Create Loyal Clients, Get More Referrals, and Increase Your Sales, and founder of Sparta Success Systems, a real estate training and tools company that focuses on helping agents and brokers create lives and businesses they can love.  www.spartasuccess.com