I spend a lot of time in social media channels and clubhouse rooms dedicated to helping new agents and struggling agents get more deals. I have heard every bit of advice from cold call more, use this script, join a team, door knock here, buy Zillow leads, hold open houses for successful agents, and everything else under the sun. On the occasion that I actually engage with the people in these rooms, I will often pose the simple question, “Why not call every FSBO, builder, investor, expired, or withdrawn you can find and offer to list their home for a lower fee just to get signs in the yard?”
Think like an entrepreneur
Now I know this sounds crazy but stay with me for a moment. There are now MILLIONS of real estate agents in the country. In your area there are probably thousands, if not tens of thousands of agents. Do you think it’s practical to out cold call all of them? Can you outwork your entire market? If 100 agents cold called a property what is the odds that they pick you?
If you get 1 out of 100 of these, are you willing to make 100 calls to get your listing? Would it not be more profitable to charge a lower fee and get 25% of those listings? Agents seem morally opposed to asking themselves that question. They are brainwashed into charging high fees and forced into a mindset of working harder and buying leads to get ahead so they do not allow themselves to think like a practical entrepreneur would.
Fastest way to become a top producing realtor
Allow yourself to drop your mental baggage for a moment and consider you are a brand-new agent, or a struggling agent, or you just moved to a new area, and you don’t know a soul. What is the fastest way to success?
I would argue that getting 10 active listings as quickly as possible is the fastest road to success. Follow that up with 20, 30, 40 more listings in quick succession and you are well on your way to becoming a top producing agent in that market. So why aren’t agents ever advised to consider this route. Recent real estate innovation makes this even easier.
Why must agents cold call and grind ad nauseum dealing with tons of rejection until they finally break through and grind out a living? What happens if the lack of true value proposition dooms them to failure? What is so toxic to real estate agents about charging a lower fee and doing a higher volume of business?
Our early real estate career
My wife and I began our careers in 2011 and we had never been in sales, we were in a brand-new area, and we knew no one. When we first became licensed, our training consisted of this is how you do deals, and this is what we expect you to charge to do your deals (shockingly 6%). Not surprisingly, year 1 for us was a total failure. We worked our butts off to find deals and we lost money and only did 1 deal.
It wasn’t until we switched to a company with a phenomenal split and used that savings to offer more value to our consumers that our business exploded. We rapidly grew in the next few years and went from losing money to making well in the 6 figures simply because people had a reason to use us, and we were keeping it quiet.
Once we created a company, 1 Percent Lists, designed around these principles, we grew to become one of the fastest growing real estate franchises in the entire country with dozens of locations across several states.
I know my worth
Agents are very quick to drop the line of “I know my worth” and thus they will not reduce their fees to do more business. The problem is, as Gary Vaynerchuk simply and eloquently said, “You don’t decide, the market does.” Agents are very quick to assign a value to themselves but if that self-worth is not matched by the public’s worth for you then you have a problem.
People in our profession are quick to compare themselves to doctors, lawyers, and engineers but we simply are not that caliber of professional despite the fact that we often make grossly more money than they do despite their decade of higher education and our two-week online courses.
I am an agent. I love agents. But becoming an agent is incredibly easy especially considering you are self-employed with no income ceiling. This has led to far too many agents which simple economics tells us drives our perceived value down. Couple this with the fact that the Department of Justice has NAR in their crosshairs and life is going to get dicey in the future.
Higher commission means work harder
If you are obsessed with higher commission rates, I hope you are prepared to earn it. You are competing with every other agent out there and have to convince potential clients that you are somehow better and they should hire you over them.
But if you are willing to make a little less per deal if it means you get to do more deals, do less lead generation, and make more money in volume I’m happy to show you the way. I would love for you to join our team.