Remembering Real Estate

May 29, 2009 at 2:35 pm Leave a comment

The Los Angeles Times recently ran “Realtors are abandoning a sinking ship.” The cheery title alone tells the story: agents leaving the business in droves…discount, Internet-based realty on the rise. The piece led to me to opine on Twitter that real estate is looking at a model similar to stock brokerage with consumers freely choosing a range of services from fully automated (discount) to fully human (higher cost) with the latter entailing a professional taking a hands-on role in the transaction.

While I stand behind my tweet in theory, it leaves out my belief in and respect for the real estate industry. I was a real estate agent for five years during the 1990s. It was during this period that I developed my skills in public relations and marketing as I promoted my individual business and was enlisted by my company, Prudential California Realty of Thousand Oaks, to create marketing pieces and press releases and to train new agents in marketing and prospecting. It was here that I learned the critical phase: “You have to earn your business, not buy it” which ties in beautifully to today’s emphasis on customer conversations versus old-school advertising and other uni-directional techniques. Before I grasped the official terms and read the books, I was schooled in “Positioning,” “Permission Marketing,” and “Creative Destruction.”

I spoke to a former colleague, Ken Calcut, about the current state of the real estate profession. I could trust Ken’s views because he has been a Realtor®  for over 20 years and is fluent in computers and the Internet. I knew he would not be staggering from today’s downturn (i.e., a newbie) or railing against technology (i.e., a Luddite).

Like the dedicated agent and happy warrior he is, Ken sees plenty of opportunity in today’s real estate market, citing ample inventory, stabilizing prices, and mortgage rates lower than the rock-bottom numbers on the “G.I. Loan” he used to buy his first house over 40 years ago. Before you dismiss that as “Realtor-Speak,” remember that every business person, company and industry has a mandate to craft compelling messages, present facts and encourage customers in this economy.

Ken doesn’t see the Internet as a threat to traditional real estate agents. “My clients are better informed about home availability and pricing than ever, and I welcome it,” he says. He confirms that consumer Web sites are increasingly comprehensive and accurate, but they can still lag the information real estate agents access via direct MLS subscriptions and knowledge of real-time events.

Ken agrees with my Twitter assessment that real estate is confronting the stockbroker spectrum of automated transaction to full-service pro at corresponding prices, but he points out that discount real estate did not originate with the Internet. “You have to be worth what you ask,” he insists. He also poses the eternal, rhetorical question: “What does it take to put a buyer and seller together with no adverse consequences after the close?”

In addressing one of the biggest knocks against traditional agents, Ken is the first to tell his clients the legal truth about real estate fees: all commissions are negotiable. There is no “6%” or “5%” or any arbitrary figure. He has zero tolerance of any actions by any agent or group of agents that smacks of price fixing or protecting a perceived status quo, such as using political maneuvers to fight discounters. He believes in the free market and the ability of good real estate agents to thrive there.

Distinguish yourself. Add value. Meet underserved needs. That’s marketing. I learned these lessons as a real estate professional. Ken Calcut has reminded me.

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Entry filed under: Marketing, Public Relations. Tags: , , , , , , .

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