June 29, 2010

Do You Stand Out in the Crowd? A Glimpse into the 2010 NAR Member Profile - Part II

We're taking a "below the surface" view into the 2010 NAR Member Profile to explore some of the habits and business practices of today's real estate agents. In Part I we looked at such segments of the report covering "who is the typical agent," income of REALTORS and some of their technology habits.

In this post, we'll explore some business practices of today's REALTOR. My comments on the figures are in blue.

15% of all REALTORS say they work 60+ hours each week while the median hours worked each week is the typical American standard of 40. (Managers surveyed work a median of 50 hours each week). ~ The real interesting question would be to discover how much of that "hours worked" was spent on Business Development activities (prospecting, negotiating, listing and buyer appointments and closings) and how much was spent on Business Support activities (paperwork, computer searches, market analyses, email, social networking, attending home inspections, etc.)

When it comes to the question of where does a REALTORS business come from, 16% (median) of an agents business is from past customers and clients. This means the listing or purchase came directly from someone you have done business with in the past. That median jumps to 39% of an agents business for those REALTORS with 16+ years of experience.

20% of an agents business came from referral business from past consumers and clients.

These numbers, coupled with the NAR Home Buyers and Sellers survey results from 2009 show the importance of the referral business for success in today's market.

How do Buyers select an agent?

44% are referred by (or is) a friend, neighbor or relative
10% used the agent before
5% are referred by another agent
4% are referred through a relocation company

How do Sellers select an agent?

40% are referred by (or is) a friend, neighbor or relative
24% used the agent before
5% are referred by a relocation company
4% are referred by another agent

When it comes to spending money, or shall we say "investing" in one's business, here's how most REALTORS spent their money. (all numbers are median)

REALTORS spent $670 on business promotion

REALTORS spent $720 annually on professional development (training, coaching, continuing education)

REALTORS spent $720 on technology products and services

66% of REALTORS have no designations. Of those who do, the most common designations are the GRI (Graduate Realtor Institute) with 13% and the ABR (Accredited Buyer Representative).

If you're reading this as a REALTOR, hopefully you have identified a few areas of weakness within the industry that you could really exploit into business opportunities for yourself. Perhaps in other areas, you now see where you could invest a little more time, money or effort.

I encourage all members of the National Association of Realtors to log on to the member website and check out this report as well as the many other tools, reports and links which may help you grow your business in 2010 and beyond. You're already paying for it so you might as well get some value from your investment.

Until next time...keep building relationships...solving problems...and having fun.

Do You Stand Out in the Crowd? A Glimpse into the 2010 NAR Member Profile

Q: What does Rhode Island, Montana, Delaware, South Dakota, Alaska, North Dakota, Vermont and Wyoming all have in common?

A: They all have less people in their states than the National Association of REALTORS has members.

The National Association of REALTORS (NAR) is America's largest trade association, representing 1.2 million members involved in all aspects of the real estate industry. This includes brokers, salespeople, property managers, appraisers, counselors and others engaged in in both residential and commercial real estate.

Each year the NAR surveys their membership to identify trends and general census statistics that give those who read the report a good sense of the pulse of the membership. The Profile report is available as a free download for NAR Members via Realtor.org or the hard copy can be purchased via the site as well. The Profile is broken down into five basic categories:

  • Business Characteristics of REALTORS

  • Business Activity of REALTORS

  • Income and Expenses of REALTORS

  • Office and Firm Affiliation of REALTORS

  • Demographic Characteristics of REALTORS

    • I really enjoy reviewing this report each year to not only identify emerging trends and potential obstacles but also to measure the success of our local agents. The report tends to create a "bar" of standards that can either be raised or surpassed by agents looking to find success.

      In today's and tomorrow's posts are a few areas that I found noteworthy. My comments follow the results in blue.

      The average REALTOR is a 54 year old white female. (Females outnumber males 57%-43%)

      77% of REALTORS said real estate is their only occupation yet 45% responded that real estate is their primary source of income. ~ This seems to mean that while 3 out of 4 in the business don't have another job, less than 2 of those same four rely on their income to pay the bills. There's an old saying that says "How hard will you work Plan A if you have a Plan B?"

      The median income figure is a bit questionable. If you quickly read the report you would think that $35,700 is the median income but that is the figure for all REALTORS. Most REALTORS are considered "sales agents." The median income for "sales agents" is just $26,600 ($17,200 after taxes). Those licensed as Brokers or Broker Associates pull in a median income of $49,100 ($31,900 after taxes). ~ Maybe with income levels that low we see now when only 45% say it's their only source of income.

      "Honey, if you quit your job I might have to start focusing more on business development activities instead of spending all day searching the MLS for homes for my tire kicking buyers and making fliers for my over-priced listing."

      89% of all members own their own home while 13% of members own a vacation home. 17% own one investment property, while 8% owns two investment properties and 14% own 3 or more. ~ I guess that shows great credibility for those members who are "putting their money where their mouths are." I do wonder if I would trust a Realtor who was telling me "it's a great time to buy" when they are currently renting a place to live.

      56% of REALTORS use a smart phone (with wireless email and Internet capabilities). ~ Maybe the other 44% are just looking to the sky for the smoke signals or carrier pigeons their clients must be using?

      10% of agents have a blog. ~ This is up from 7% in the 2009 report so more and more people are starting to find a voice in the crowded landscape through on-line web logs. If you're an agent, what are you doing to become the "trusted advisor" and source of information on your community, market place or neighborhood? A blog isn't hard to create and there is plenty of information out there to be shared with people who know, love and trust you.

      In Part II of this post, we'll look at some of the areas in the 2010 Member Profile discussing where REALTORS are getting their business, how they're spending their money and how they spend their time.

      June 25, 2010

      From One Blog to Another

      If you asked a waiter, bartender of maitre' D at one of your favorite restaurants for the name of a new place to eat or drink, would you trust their recommendation?

      If you asked you local golf club professional for a good place to play when you traveled on vacation, would you consider their advice?

      Would it seem odd to ask the clerk at your local clothing store about other places where you could find similar outfits or perhaps items by similar designers?

      I genuinely appreciate my loyal readership here at The Realtor's Toolbox blog so please don't take what I am about to say to you as me saying I don't want you to return... because I do.

      You need to be following the Keeping Current Matters blog!

      Yes, that's right. I am saying it's okay to see other real estate blogs. I won't get jealous...unless you stop coming back to see us here...and you never write to me anymore...or you forget that my birthday is on October 12th...or I find KCM's lipstick on your collar!

      The mission of the Keeping Current Matter's blog is:

      "The mission of the Keeping Current Matters Community directly aligns with the symbol it adopted. The spiraling SHI represents the sweeping away of old patterns that, in the past, may have limited us in order to bring forth a new, more progressive energy that will thrive in its place.

      The KCM Community’s mission is to bring this positive surge to today’s real estate market. So if you are ready to take part in our mission– this is the place for you. KCM not only leads with its great ideas, but we inspire action. Join our community, help promote our mission, and let’s turn this market around one house at a time."

      The brains behind KCM is Steve Harney. According to his personal website, "Steve was a top performing residential Realtor before he steadily built his own 500 agent real estate firm. It was during that process that he established his method for raising average sales agents and managers to the level of top performers. Recognizing this industry-wide need, he set out to help Realtors achieve their true potential, and launched Steve Harney, Inc., his own brand of training and negotiation seminars.

      Steve Harney authors the popular monthly Keeping Current Matters™ audio visual report for top agents and managers, and travels the country as an industry speaker and trainer in high demand."

      I subscribe to the KCM blog and excitedly open each post when I receive it in my email, knowing that whether I agree or disagree with the post (and disagreement rarely happens) it will be something I can use in my daily teachings and discussions with Realtors, managers, leadership people and every day buyers and sellers.

      Posts like this one or this one not only make you think as an agent, but also provide you with some excellent third party information that your clients need to hear. We've got to stop telling clients what they "want to hear" and if you're not string enough to do that, let the KCM blog posts be your voice.

      Check out KCM and let me know what you think. I feel comfortable that there will be some "tool, tip or technique" that you'll find over there that that will help you "build more business." Just don't forget about The Toolbox. We'll still be sharing great ideas and inspiration to keep you hammering out more deals in 2010 and beyond.

      What other blogs have you found out there that provide you with great infomation, positive inspiration and just make you excited to read them? I'd love to know what other great sources are out there.

      Until next time...keep building relationships...solving problems...and having fun!

      June 14, 2010

      Little League Hustle - Big League Focus

      The pre-game practice session has begun. Boys are playing catch and every once in a while, one of the Sea Wolves look across the field to catch a glimpse of the vaunted Sea Dogs.

      "Wow - they're kind of big."

      "I hear they only lost once and it was a close game."

      "Who brought the snack tonight?"

      "C'mon, " yells the coach. "Let's focus."

      The pre-listing routine begins. The appointment has been scheduled with the Sellers of that well-known house on the corner of the popular street. All of a sudden, nerves start to tingle. You're going up against one of the cities best Realtors. You've heard rumors that they've been known to reduce their listing fee. You really feel that you're worth a full fee but you've never had to compete for a listing against this agent before.

      "C'mon," yells the coach. "Let's focus."

      The game begins and it's just two teams of eight-year-olds. Everything you've practiced, rehearsed and drilled on is put into action between the chalk lines. There's no do-overs, there's no extra strikes or bonus outs.

      The game starts with the Sea Wolves taking a mature approach. We're the visitors so we bat first but the bats are connecting tonight and we manage to score three runs in the first inning. It could have been more but a few strike outs and a loss of focus on the base paths catch up to us.

      "C'mon," yells the coach. "Let's worry about ourselves and pay attention."

      You show up on time, dressed professionally, ready to deliver a great presentation. You've done your homework and feel comfortable that the Market Analysis that you carry in your briefcase is right on the money. Sure, these Sellers bought their house at the peak of the market and have added some "high value" features but it still comes down to creating the best perception of value to the current Buyer pool, right?

      A true professional tells the Sellers what they need to hear, not what they want to hear. A true professional knows that it's better to "level with the Sellers now rather than let them down later."

      It's time to start focusing on the words that you've been practicing for hours, days and weeks. It's time to start speaking not only of the features of your company and services you offer but the benefits those things will bring to the Seller. It's time to start asking questions and listening to answers. It's time to take control of the things you can control and stop worrying about the things you can't.

      "C'mon," yells the coach. "Let's worry about ourselves and pay attention."

      The early lead doesn't last long as some weak defense allows the Sea Dogs to take control. While there was some good athletic ability displayed by the opponent, it was really more about unforced errors and less about great execution.

      The two teams trade some runs and the favorite goes up 8-3. Sunlight is fading and the kids are starting to wonder what the snack will be. But there's still an inning to be played and we haven't quit yet.

      "C'mon," yells the coach. "Let's try our best and don't give up."

      Your presentation goes well but the Sellers say they'll "let you know what they decided." Ouch. You know that isn't good but you didn't want to be too aggressive and ask for the listing because you already knew they would be meeting with "the Top Dog" later in the week. You know your opponent isn't worried about you. Heck, they are probably walking in without even studying the market, practicing their scripts or polishing up their objection handling techniques. They've lost more listings than you've even competed for, so why worry? Show up, dance the dance, tell the Sellers what they want to hear and stick a sign in the yard.

      "C'mon," yells the coach. "Let's try our best and don't give up."

      "This will be your last at bats, Sea Wolves," says the umpire. "You'll need to score at least 5 to tie, 6 to take the lead."

      Hmmm? You check your cell phone and it seems that the Sellers have left you a message. They haven't made up their mind yet. What you might have thought was a foregone conclusion turns out to be a battle. They were very impressed by your marketing presentation, personal and professional confidence and strong market knowledge. They know the other agent is a big name locally but they were really impressed by the way you were so proud of the team you worked for and really sold the support systems your team has in place and your personal desire to help the Sellers achieve their goals.

      They invite you back in for one final series of questions. You look at it as kind of your "last at bat." You strut in with nothing to lose so you're relaxed and even smiling. Your first comments draws laughter, just as you intended, and you start rolling. One question after another is handled with ease and your confidence starts to soar.

      After one last set of questions over the phone with the other agent, it's down to this. Will you let a reduced commission or a short term listing sink you? Hell no - you buckle down, stand your ground and you don't blink. "This is my price, this is my fee and this is my commitment to you," you say with confidence. "Are you ready to get started."

      Hmmmm? You check your batting order and you're only down 5 runs. Oh well, it was a great effort, you think to yourself. We really battled hard. Let's try and finish up strong and get some good swings.




      Two runs scored. It's now 8-5. Runner on second. No outs.

      Single. 8-6.

      Double. 8-7.

      Single, single, single. 10 - 8...and still nobody out. Are you freaking kidding me? Where has this been all season? We haven't had this many hits in a row since tee ball two years ago. We strand a few runners and take the field for the last time protecting our first lead we've ever held after the 2nd inning.

      "C'mon," yells the coach. "Are you guys ready? Let's focus!"

      Uh oh! The other team is at the top of the order. The first three kids maybe couldn't start for the Yankees but they might turn some heads in the 3rd and 4th grade leagues.

      First batter drills a ball to second base but Ethan is there with the glove. A soft toss to Ryan at first and it's one out.

      "C'mon," yells the coach. "Know where the play is and focus."

      Second batter is up and it's their best hitter. He's already had a double, single and triple. Oh Lord, is this kid gonna hit for the cycle against us...in second grade? Nope - he strikes out. Two outs. One out away for our first victory of the season.

      "C'mon," yells the coach. "Down and ready."

      Here comes the pitch.

      It hits the batter - not exactky what we wanted - and the tying run comes to the plate. Parents wring their hands. Little siblings stick their heads into their parents sides. The coaches re-position fielders to maximize the chances for one more out.

      The ball is hit...a slow dribbler to the Nick, the pitcher...this runner is fast and Nick bobbles the ball.

      Nick gains control...aims and throws...Ryan toes the base and sticks his glove up...and...he's...out! A great play at first as the throw just beats the runner. Elation hits the Sea Wolves as they realize they have just won a game! There are mini chest bumps and awkward high fives and serious adult relief on the sidelines. Coaches breathe a deep mixture of pride and relief and Ethan's mom readies the donuts and juice boxes - she's a mom...she knows what's most important.

      "C'mon kids," yells the coach. "Let's celebrate."

      Will you be ready to make a great swing with your time at bat comes up? Are you prepared to make the best pitch possible on that next chance you get? Will you play the field confidently because you know what to do when put in a position to take control?

      You better be. Those donuts don't taste as good after a loss!

      Until next time...build relationships...solve problems...and have fun

      This blog post is close to fictional and does not exactly resemble any true life events.

      But if it did, The Realtor's Toolbox would like to congratulate Ryan, Nick, Ben, Andrew, Ethan R., Oscar, Alex, Sam, Jimmy, Todd and Ethan Y. along with Coaches Geoff, Ammon, Tim, Bernard and Craig.

      June 6, 2010

      Worms, Websites and Wisdom

      I love reading books where you really get wrapped up in the story and find yourself pulling for the main character to succeed. Whether it was hoping for Harry Potter to escape the Chamber of Secrets or Mitch McDeere to stick it to the sinister lawyers in John Grisham's The Firm, turning pages in hopes of a happy ending is nothing new in American literature.

      But those books and many more like them are fiction books - make believe stories that lend themselves to white-hatted heroes and ignoring the reality of every day life. It's easy to believe in a character who was created in the mind of the author. I guess it's human nature to cheer for the protagonist.

      That's what makes the new book by Zappos.com CEO Tony Hsieh so fun to read. In the new book that will hit bookstores today (June 7th) titled Delivering Happiness ~ A Path to Profits, Passion and Purpose, you will really find yourself pulling for Tony and his fellow entrepreneurs, associates and business partners to find success (even if you already know the stories ends with a mind boggling $1.2 Billion merger with e-Commerce giant Amazon.com)

      I was sent a free advanced copy of Delivering Happiness in exchange for an honest opinion of the book here in The Realtor's Toolbox blog space. The book is available in bookstores and online starting today but be sure to keep reading and you'll have a chance to win a free copy of your own.

      The book really draws you in with some genuine stories of Hsieh's early days as a child beings raised with the high expectations of Taiwanese parents. His entrepreneurial side emerged early with his desire to turn a Boy's Life advertisement for a worm farm into a profitable business. After the worm farms, it was customized buttons and garage sales, newsletters and holiday cards. Hsieh didn't make his millions as a teenager but it wasn't for lack of trying.

      Delivering Happiness is structured into three separate sections. The first section on "Profits" details Hsieh's early days through college and his early challenges, successes and growth until his launch of Zappos.

      Section two, on "Profits and Passion," details the atmospheric growth of Zappos and really introduces the reader to the Zappos culture and community that has made it one of Top 15 "Best Companies to Work For" according to Fortune Magazine.

      The final section, "Profits, Passion and Purpose" is Hsieh's chance to help the reader challenge themselves to instill a little of the Zappos mojo into their own life and business.

      While I sincerely encourage you to check out the book or the affiliated web site for the book, I would like to share some of my favorite concepts, ideas and takeaways from this book.

      What's Your BCP? - The Zappos team keeps a tremendous focus on the company's Brand (boiled down to "wow"ing the customers), Culture (centered on core values below) and Pipeline (employee training and development). Ask yourself - how do to measure your BCP? What can you do to raise your BCP to be worth talking about?

      Only 5% of Sales Happen Through the Telephone - Yep, Zappos is an Internet company but they are so focused on customer service they know that if they can use those opportunities when talking voice to voice with customers to further the relationships, they'll have a better chance of building sales or referrals...or both. According to Hsieh, "what we've found is that on average, every customer contacts us at least once sometime during his or her lifetime, and we just need to make sure we use that opportunity to create a lasting memory."

      Hey Realtors - Is that any different from what you would like?

      Zappos Core Values
      (See if any might be worth adding to your daily service with clients)

      1) Deliver Wow Through Service

      2) Embrace and Drive Change

      3) Create Fun and a Little Weirdness

      4) Be Adventurous, Creative and Open-Minded

      5) Pursue Growth and Learning

      6) Build Open and Honest Relationships with Communication

      7) Build a Positive Team and Family Spirit

      8) Do More with Less

      9) Be Passionate and Determined

      10) Be Humble

      As I said earlier, I encourage you to visit the website or order your own copy of the book if you'd like to see how you might be able to put a little "Zappos" into your business

      Or, if you'd like to win a copy of the book, look again at the list of Zappos Core Values and let me know (by commenting on this blog or sending me an email at sean.carpenter@cboki.com) which one of their core values would most align with your way of doing business. Be sure to tell me why you chose the one(s) you did and you'll be eligible to win a copy of the book.

      I'll leave the contest open until next Monday, June 15th and then will randomly choose one of the replies to get the book.

      June 3, 2010

      Studying for Your Mid-Terms?

      We're not quite to half-time in the 2010 year but it might be a great time for you to pull the car over to the shoulder and check your Triptik. Are you still on course for your original destination?

      155 days are in the books for 2010. There are 210 left until the ball drops us into 2011.

      Just think - if you had planned a family vacation back in January and you were scheduled to arrive there on December 31st, do you think you might be checking on your progress every now and then? C'mon, admit it... you like it when your pilot on a cross country flight comes over the intercom and provides you with a progress update and maybe tosses in a personal touch with the "look out your window on the right, we're flying over the largest cornfield in Nebraska right now" tour guide impersonation.

      Were you one of the many Realtors last October or November who scribbled down some "business plan mumbo jumbo" and handed it in to your branch manager because he or she told you to do so? Have you written some goals that are tucked away neatly in some drawer, never to be seen again...that is until the day you're looking for that long lost Subway 2-for-1 foot long coupon?

      155 days are already gone in 2010....

      ...There are 210 days left.

      Feeling anxious yet?

      If you're a sports fan I am sure you have seen many instances of your favorite team trailing their opponent heading into halftime and then, almost miraculously, finding their focus in the locker room and coming out a seemingly different team in the second half. Or maybe you've been in a movie theatre wondering why you paid $9 for a crappy movie only to have the second half change your mind and you give it "two thumbs up."

      The national and local numbers for the year so far have been decent...not great, but there is business out there to be had. When was the last time you studied the local market stats from your MLS and/or Board of Realtors? Are you putting yourself in position to grab the business that is happening daily? Regardless of what the Negative Neds in your office are saying, there are people buying and selling homes every day. Can you honestly look back at the first 155 days and give yourself an 'A' when it comes to business development? How's your score for time management? Are you satisfied with your levels of customer service to clients and most importantly, past clients?

      It's almost time for you mid-term exams. Better start studying if you aren't confident that you know the material that you'll be tested on. There's still plenty of time left in 2010 so don't toss in the towel yet.

      Get out there and start doing what it takes to achieve your goals...

      Building relationships...solving problems...and having fun!