"Number one agent in Denver. Top agent in Milwaukee. Best Laguna Beach agent on the face of the planet."
Consumers have been blasted with similar types of advertising by competitive real estate agents, little of which might make sense, especially when all they claim to be better than the next guy. What can you believe? And do you or should you even care?
The bottom line is that many sellers and buyers do not care if they hire a top producer real estate agent. Most people want the job done and the job done well, ethically, honestly, and without a lot of drama.
- The qualifications for becoming a top producer can be set regionally by local real estate trade associations.
- Companies, groups of agents, or even an individual agent may also make their own determinations about what a "top producer" is.
- If you're concerned about potentially misleading marketing from an agent, you should ask for that agent to qualify the claims made in their advertisements.
What Does It All Mean?
Some buyers or sellers might even worry that if an agent is a top producer, that means the agent is too busy to help them adequately. That is not usually the case.
Honestly, there is a stark difference between a top producer agent and, say, a megastar agent. A megastar has extraordinary sales numbers, resulting in annual incomes of $500,000 to $1 million and up.
It also depends on who ranks the production and how it is ranked. For some agents, being a top producer means they have sold a million dollars worth of real estate, which today is not saying much. For example, if you're talking about the real estate business in the 1970s, then a million-dollar producer was a big deal. At the end of 1975, the average sales price of a home was $44,400.
Even today, selling 12 homes a year, about a home every 30 days, can qualify an agent for top producer status.
Board of Realtors Top Producer Standards
Each realtor trade association across the country carries its requirements for top producers. The requirements to qualify as a top producer tends to change depending on market conditions.
If you take a look at the Sacramento Board of Realtors, the qualifications to reach the master's club status varies in any given year. To be a "master," that would mean a minimum of $5 million in sales and eight closed transactions, OR twenty closed transactions.
By comparison, the Chicago Association of Realtors names top producers in categories exceeding 148 units to those who close 27 units or more, all the way down to $9 million or so in dollar volume production.
Brokerage Top Producer Standards
Also, each major real estate brokerage offers its agents annual rewards for production. For example, ReMax, celebrates its agents' successes by handing out awards for the 100 percent club, platinum club, chairman's club, and diamond award, among others.
Individual Agent Top Producer Standards
Real estate agents advertise their achievements in just about any manner you can imagine. Some agents exaggerate or, in some cases, even lie. They might put a sign on a house that claims they are the number one neighborhood specialist, but that designation could exist solely in their minds. You can and should ask an agent to qualify that sort of statement upon meeting them.
Some real estate agents might use the number of homes sold to justify a number one status. As long as that agent has sold more homes than any other agent in the named territory, it could be a justified statement. On the other hand, consider an agent who sold only 10 homes, but each was a million dollars or more, boosting that agent's dollar volume production to more than $10 million. If another top producer agent sold 50 homes, but their production fell under $10 million, the agent who sold more than $10 million can also claim top producer status based on dollar volume.
Local Top Producer Standards
Top producer standards can also be established by an individual, a real estate team, and ranked against all agents or ranked against just the agents in a particular brokerage. An agent might claim to be the top producer for all of South Florida, or just Dade County, or the city of Miami, or even the neighborhood of South Beach, all the way down to selling the most oceanfront homes on Ocean Drive as the top producer of Ocean Drive.
Agents try to find a way to differentiate themselves from the competition. Look at status qualifiers to form your own opinion. If you are unclear about an agent's advertising or claim, ask the agent to explain it to you. But do not hire an agent based solely on an agent's award or self-imposed claim to greatness. Hire an agent you trust and like with the experience required to close your transaction.