Top 10 Trends in this Real Estate Environment
The new and more innovative ways of getting out the message can mean the difference between a home selling in a reasonable time and for a decent price and one languishing on the market.
Three trends I can think of right off the top of my head that are changing the real estate industry is the amount and structure of agent commissions, both on the selling and buying side, the impact of technology on the marketing of properties, and the strategy of setting asking prices on round numbers which instantaneously doubles the amount of potential buyers.
1) The amount of commissions agents charge. Flat-fee listing models are sweeping the nation. Our $500 listing offers sellers 70 points of marketing, more than is normally provided by a traditional “full-service” agent. We negotiate the contract for just .0034 of the sales price and even allow the seller to sell to a buyer on their own and save the 2-3% commission they are offering out to buyer’s agents. This Buyer Magnet System of selling homes that we created and perfected, bringing massive exposure, coupling it with cost savings and the experience that comes with a high-volume based business model, has sold already over 7,000 of our 10,000 listings here in Atlanta to date. And this business model has been licensed to over 55 cities around the country as well through our license program detailed on www.RainmakerRealty.net .
2) The use of technology as a means to do more for less. Companies like mine have used technology and the economies of scale provided by a high-volume based business model to offer homeowners massive exposure at lower costs to market their homes. Sellers who are savvy and who want to remain empowered during the home selling process naturally gravitate to this model, because they are knowledgeable enough to know that it gives them the best chance of selling and, as my results have proven, in half the time of the industry average. Plus with the commission savings I give my clients on the selling side, they can go out and offer more commission to buyer’s agents, normally 4%. This usually gets the buyer’s agents to bring their clients to my listings first, before going to other properties offering the more traditional and pedestrian 3% buyer’s commission. In other words, the sellers can underpay the listing agent and overpay the buyer’s agent – the one’s that actually have the buyers.
3) Flexibility to allow clients to be more empowered and encourageded to participate in the home selling or home buying process. Another great component of this growing realty model, is that I allow my sellers to show their own properties and if the buyer comes in without an agent, save the buyer commission. Most do-it-yourselfers love this option because they know they are the expert when it comes to their own home and they realize that every dollar they don’t pay out in commission, that a traditional agent would scoop up, is one more dollar in concessions to the buyer to make the transaction work and work quicker, or one more dollar in profit they can put in their own pockets.
4) Companies like mine, Duffy Realty of Atlanta, are also offering something new in the industry to aid buyers in their home purchase – a buyer rebate. We call our buyer incentive the Duffy Realty Buyer Cash Bonus, because it is technically not a rebate, due to the fact that the commission is normally paid by the seller, but reduced fees from the buyer’s agent in the form of a check written at closing. We pay our clients part of the commission we receive because in our business model, and as in many other companies mimicking our approach, because they do some of the legwork in the home buying process for themselves. They can earn in most cases between $500 and half our commission, which can be money put toward the down payment or upgrades for the home.
5) The power of the Internet is vital in marketing properties, even those that are listed. The first time someone sees your property is not when they visit it in person anymore. The first time they see a home is on the listing database or on one of the thousands of real estate websites where properties are advertised. To make a great first impression and to entice buyers to come to your home you must have great pictures. If you are listed today and you think the pictures your agent has provided are ugly and make the house look unattractive, so does everyone else. Just another reason why it is essential to have your home in as much exposure on the net as possible and make sure it appears as the best product it can be.
6) How to best price a property for sale. Since most people look on electronic databases for their next property, Multiple Listing Services for the agents and websites for the general public, it is imperative to know how to price the property in this new technological age. Most agents still price properties at psychological points just under big number milestones, like $299,900 or $449,900 and such. Because of the way search engines now pull up properties, it is far better to price properties on the round number like $300,000, straight-up. That way all the people searching from $200,000 to $300,000 can pull them up as well as the other strata of people searching from $300,000 to $400,000. They will be end-posting both search queries y using the number most likely to be used as the high and low endpoint of the search. In other words, no one has ever started a search from $299,900 to $400,000.
7) Social Networking has given sellers an easy, no cost medium to market their homes and lifestyles. Media outlets such as Twitter, Facebook , You Tube and Linked In have given a multi-faceted platform for sellers to showcase their wares to greater numbers of opted-in potential buyers.
8) Video allows a real-time, real-life look at properties for buyers they ever get in a car. Advancement in easy to use video recorders, like Flip cameras, with their simple download feature and the free and easy to use video storage websites like You Tube to catalogue and house their recorded content makes this the perfect way to market their property to the agents and buyers alike.
9) More and more access to sophisticated online search engines gives home buyers and the agents helping them with their search the ability to sift through incredible amounts of inventory to more efficiently hone in on the homes that more closely meet their search criteria. Making the home buying process more fruitful and enjoyable and ultimately more successful.
10) The number of inexperienced, unethical and just plain inept agents being culled from the ranks of the real estate industry is on the rise because the effects of a prolonged, tightening economy. The part-timers, novices and those agents that really don’t know what they are doing are being forced out of the business by market constraints allowing the Darwinesque result of having more proficient professionals being left to steer and grow the industry as a whole.
Because I run a high-volume based business, I have had many more opportunities for learnings like these, and it gives me a much greater ability to spot trends in the industry than the traditional agent who only lists four to five houses a year!
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