What Is Your Real Estate Practice-to-Marketing Education Ratio?

Are you learning to sell or to service real estate clients?

Real estate closing
Getty Images/DOUGBERRY

Real estate brokerage is still too focused on how to sell properties, rather than how to serve sellers and buyers. The mechanical result is the same, a contract, but the methods and motivations are very different.

What too few real estate professionals recognize is that perhaps the most disruptive real estate effect of technology and the Internet is the empowerment of the customer/client. They are less likely to respond to selling than in the past and more likely to respond to information, helpful processes and the perception of value for services received.

Courses That Enhance Process and Expertise Rather Than Selling

Taking courses and perfecting your techniques and processes to improve on these expertise items will make you better and more valuable to the informed customer. Here are courses that focus on these items rather than on selling:

  • Real estate law in your state.
  • Representation, duties and agency law.
  • Local zoning and property use restrictions.
  • In my market, septic regulations were crucial.
  • Inspection processes and negotiating repairs with the other side.
  • Federal equal housing and discrimination law.
  • Survey or ILR interpretation.
  • Careful examination of covenants, restrictions and title insurance binders.
  • Negotiation strategies on initial contract price; balance with process moving forward.
  • CLUE Report, Comprehensive Loss Underwriting Exchange if applicable.
  • Future value appreciation relative to the market competition.
  • Thorough market research and accurate CMAs for both buyer and seller.

    There are more courses, some are market area specific. The point is that these things make you better at your job, which makes you better than much of your competition. Now you have something to market on your website and in other media that sets you apart and sells you without selling.

    Focusing on Selling in Real Estate Can Result in a High Backout Rate

    At one time in my real estate practice, I had a friend who transitioned from used car sales.

    He was an "ace" at pushing the contract across the table, overcoming objections and all of those sales techniques that get the signature on the bottom line. One day we were chatting, and he asked me how many buyer backouts I had in the previous year. He asked because he was experiencing a high percentage of buyers backing out of deals for no apparent real reason other than buyer remorse.

    We operated in a mountain vacation and resort market, so one characteristic was dominant. Few of the homes we sold were for working people in the area. It was an expensive market, and neither side of a transaction had to buy or sell. Sellers may simply tire of that ski area and wanted to move to another. Buyers had been vacationing in the area and figured they could buy for more visit convenience and not having hotel bills.

    For these reasons it wasn't a case of let's get into our home so I can go to work and go on with life. It was more often a discretionary purchase they may even make on an impulse. I told my friend that I had only one buyer back out of a deal simply due to changing their mind the previous year. They killed the deal because they found that their resort hotel employer wasn't doing well and was planning layoffs; fear of losing their job.

    The problem my friend was experiencing was selling hard and getting the signature. However, with a transaction having multiple easy points to get out with earnest money, inspections, etc., he found that some were having second thoughts and taking advantage of an opportunity to cut and run. Finally getting to the point, if you're taking CE or other courses all about the "Art of the Sale" or overcoming objections and neglecting more courses about property rights, surveys, inspections, real estate law and representation, then you're focusing too much on the wrong stuff.

    I could never argue with any objection a customer/client might have about a certain home or mountain property. Even if their objection wasn't realistic, such as thinking a fairly priced property is grossly overpriced (common in my market then with median price of vacation home over $400k), it was valid from their perspective.

    I would simply show them the buyer CMA I did for every buyer and let them make their decision. In other words, my job was accurate information and transaction service, not selling anything.

    Don't neglect building your expertise in areas other than selling techniques. You will enhance your value to your clients.