Small is the new big
I recently wrote about how Small is the new Big, making the point of how small brokers are able to compete with the large brand brokers much more effectively than ever before due to the evolution of real estate 2.0. The comments were all over the board, many supported my points and there were several dissenting opinions.
However, a few of the comments left me wondering where some agents’ thoughts come from? Are they really their own opinion or have they been brainwashed by the brand?
This article was originally published on July 07, 2008.
The comments were well presented and came to logical conclusions (I am not attacking the commenter(s), merely just pondering the possibility of broker brand brainwashing.) This comment is very logical, but sounds like broker brainwashing to me…
Every year I look at every transaction and evaluate the source of the business. If the brand causes one transaction per year, and I were to allocate 100% of the earnings for that transaction as having paid all the royalties for the whole year, where would I stand? If the brand brings any additional transaction, my payback on the royalties far exceeds the royalty I pay. So far, over the past 6 years, the (removed broker name) brand is responsible for 3-5 transactions per year that we would not have received otherwise.
Take me to your leader
Every broker I know makes this assertion when dealing with push-back on commission plans from agents. “Would you question the splits if our brand delivered enough leads to cover these expenses every year?” That’s a hard question to say ‘yes’ to. But if you think through this assertion and realize what you are getting into, then the assertion begins to have less value.
What if a small broker could send you the same amount of leads? Would you still pay more for the brand name? What if you generated so much business on your own that you didn’t have time to work the leads from your broker? Would you still pay more for the brand name? How do you know that you would not have received those leads from a small broker? Why allocate 100% of your work on a transaction to cover royalties?
Do you enjoy working for free?
These aren’t the droids you’re looking for
Granted there can be many reasons (but often times they sound like justification or rationalizations) for going with a large brand name broker, and I contend broker brand means less today than ever before. Small brokers are generating as much or more leads from utilizing web 2.0 tools than many of the large broker brands in local markets all across the country. The real questions you should be asking yourself (and your broker) are… Did the large brand name itself generate business I would not get from a small broker? If so, then does the income from those leads offset the additional fees charged by the large brand? I simply advise you to consider small brands when shopping for a broker. Often times small broker commission plans are far more attractive and you may not give up any leads handed to you by the broker.
If large brand name broker gives you a bundle of services and leads at a cost to you of X and small broker gives you the same bundle of services and leads for Y (where X is greater than Y), then why pay more for the brand? Do yourself a favor and shop broker services and don’t forget to consider the small local broker.
Austin tops the list of best places to buy a home
When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?
Looking at the bigger picture
(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).
That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).
They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.
“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
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