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Why So Many Real Estate Agents Make So Little Money. Lead or Lose?

Would you call yourself a Leader?

Most importantly, do others describe or perceive you as a Leader?

Do you think a real estate agent can earn a real income if they aren’t a Leader?  I don’t.

Here’s why. . .

If You’re Not A Leader, Then You’re a Follower.

We earn real income by attracting and delighting our clients and closing real estate transactions.  The cycle never stops.  When it does, bye-bye big bucks.

The reason it’s next to impossible to earn a brow raising income if you’re not a Leader is this.  Followers don’t attract.  They um, follow.  Leaders attract Followers. Well paid agents all attract. They attract Followers who believe their Real Estate Agent Leader knows what she’s doing and can make good and wonderful things happen.  They believe their Leader will help them fullfil their dreams and aspirations.  The Leader gets paid for doing so.  If we can’t attract, delight and keep Followers, what do we really have?

If you’re with me so far, then we can conclude that whether we think we’re a Leader or not, if we want better than average success, we should behave like Leaders.  Right?  But what if we don’t think we’re really a Leader. Not everyone’s a Leader ya know.  What then?

The solution is simple.  I suggest we simply behave like a Leader.

You know what a Leader behaves like right?  Yeah, I know.  There’s a spectrum of Leadership styles.  You’ve got your maniacal Leaders like Hitler, charismatic Leaders like Oprah and other types we could list off.  People like Kennedy, Gandhi, Dr. King, Susan B. Anthony and so on. I don’t believe we should focus on Leadership Styles.  I feel like we should focus our attention and model our behavior based on the positive common character traits shared by all Leaders. I think if we Lead based on the common positive character traits that all Leaders share, the appropriate style for the situation will occur naturally.  So the next question is this. . .

What Common Character Traits Do All Leaders Share?

I believe the dominant traits are:

Passion and Devotion

All the other good character traits probably fall under Passion and Devotion as subcategories or descriptions-of.  If we run our daily intentions, actions and interactions through an Am I Executing and Engaging with Passion and Devotion Filter, it’d be easy to figure out.  We’re either Leading or Following.  Attracting or not.  We’re gonna earn fatter stacks or we’re not, depending.

If It Was Easy Anybody Could Do It.

Passion and Devotion are scary words. They’re All-In words. Do both and you’re burning your boats and torching your bridges for what you believe in.  I guess that’s the spooky point and why so many real estate agents make so little money.

There’s no way to turn a blind eye or pussy-foot around it.  Being a Leader is the opposite of easy.  But, if we want to earn what Leaders earn, we have to decide that we’re in-it-to-win-it.  That means we have behave like Leaders and torch our escape boats and bridges.  Which is to say, we have to be Passionate and Devoted about delighting our clients, suspects, prospects, neighbors, friends and friends of friends.  No easy feat.

The Only Thing Stopping Us Is Us

Not everyone is in-it-to-win-it and that’s OK.  If a few satisfied clients is satisfactory, then Leadership isn’t a big deal. No sweat, rock on.

Ah, but if you need to achieve more, then behaving like a Leader will get you there and keep you there.  Deciding to Lead will change everything for you. I know this because I’ve seen it happen over and over again.  And so have you.  The rare ones that decide to do-or-die, they always RISE.   And so would we.

Everyday our actions and interactions define us.  Will I be a Leader or a Follower?

I’ve made my decision.  I’m gonna go buy a lighter, wanna borrow it when I’m done?

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Cheers and thanks for reading.

Photo Credit

56 Comments

56 Comments

  1. Greg Lyles

    February 21, 2011 at 8:33 am

    Ken,

    I’m not sure it’s even that complicated. Perhaps the reason many agents don’t make much money is far simpler – there are too many agents in the market! It’s simple economics, really. There is a limited supply of ready, willing and able sellers – and buyers – at any given time. That is offset by a gross oversupply of agents relative to the number of viable deals.

    The agents that outperform the others are not necessarily leaders in the positive sense. We have several in our market who make outrageous claims to their annual production while somehow omitting the footnote that their underlings did the vast majority of that production. Or agents that will tell sellers whatever they want to hear to get a listing and then selling those listings at an average of 25-30% discounts from the original list price. Or agents that claim they sell 70% of their own listings yet they haven’t sold a single one of their own listings in the past three years. And it goes on and on.

    So, for my $.02 worth, I think we have a massively overcrowded market led by a handful of productive agents. Unfortunately, many of those top producers are not behaving like leaders.

    • Fred Romano

      February 21, 2011 at 9:00 am

      I tend to agree with Greg. Too many agents, too few [real] sellers and buyers. The markets are dead in the water and all of us are scrapping the bottom of the barrel. It really stinks to live month by month.

      • Ken Brand

        February 21, 2011 at 11:34 am

        I hear you Fred, it is HARD for sure. And it doesn’t help that lazy folks can eek out a deal or two a year from unsuspecting friends and relatives. Having said that, if we don’t pour ourselves into it, we at the mercy of both the insincere and the Passionately Devoted. Thanks for sharing and let’s hope spring and summer provide some relief.

        Cheers.

    • Ken Brand

      February 21, 2011 at 9:27 am

      You make some great points Greg. My thinking is that given a choice, civillians desire way more service and action than the average and ordinary agent delivers. It’s true there are swarms of agents doing a couple of deals a year, and that’s an opportunity. If most are apathetic, lazy or comfortable, then positive Leader can shine, attract more business (Followers) and earn more referrals. Follower types will stumble onto business or manage to become “chosen” once or twice, but once the friend or relative is taken care of, it’s Crickets and Crew Chief at McDonalds income.

      As for the negative Leaders, we find those clowns in every business. In the mid and long run, positive will out earn negative every time. It’s not matter of if, it’s a matter of when.

      Thanks for sharing your thoughts and all the best.

  2. Jeff Bulman

    February 21, 2011 at 9:27 am

    Good article Ken. I think being successful in real estate has a lot to do with your work ethic. Most people are not motivated enough to start there day at 8am and work until 8pm. I have told agents how to make money in this business and frankly they are to lazy to do it. So many get into the business thinking we “show houses all day”. New agents get caught in the trap of countless office meetings, broker open’s and the many other things that are out their for agent’s that don’t make them a dime. The hustle always wins in our business, especially in this market.

    • Ken Brand

      February 21, 2011 at 9:29 am

      I see the same thing too Jeff. There’s a big difference between, lazy, active and productive. The Passionate and Devoted are active, helpful, productive and prosperous. Cheers.

  3. Matt Stigliano

    February 21, 2011 at 9:34 am

    Seeing the title of this post, I almost skipped over it. I figured it would the usual laundry list of troubles: broker splits, marketing budgets, self employment taxes, desk fees, and such.

    Seeing it was written by you Ken, I figured there might be something else under the hood. Glad I read it – feeling inspired as I start my Monday. Which of these boats need torched first?

    • Ken Brand

      February 21, 2011 at 9:46 am

      Thanks Matt. I really enjoyed your share at Xplode. Yeah, let’s burn it down, I’ll bring some beer and marsh-mellows. Hit it my man. Cheers.

  4. Virginia Dean

    February 21, 2011 at 9:48 am

    What a wonderful post to start my week. I am starting over in a new market, and weaning myself away from a full time job. In April I will pull the plug on that. I have been working on my database, going to do some farming, which I have done before and also learning the market as best as I can. I am very techy, so need to not lose myself in all the toys available these days.
    Thanks so much for your wisdom.

    • Ken Brand

      February 21, 2011 at 11:35 am

      Grace, speed and success to you Virginia. On Purpose and In Person conversations is the key. Thanks for sharing. Cheers.

  5. Lani Rosales

    February 21, 2011 at 11:39 am

    My favorite line: “Passion and Devotion are scary words. They’re All-In words. Do both and you’re burning your boats and torching your bridges for what you believe in.”

    This will easily be the most overlooked point. I believe people will skim and believe you’re saying they must be leaders or they will fail but *I* hear you saying that success comes from passion and drive and you must not worry about what everyone around you is doing and decide that you’re going to hustle your way and blaze your own path.

    • Ken Brand

      February 21, 2011 at 1:10 pm

      I hear you, I think they go together. Of course there are lot’s of nuances and if-this, then-that, except-for-this. But I do believe that people (clients) will follow, choose and refer the agent they believe is Passionate and Devoted to the business of delighting clients. And absolutely, you can’t be worrying about what people or competitors are doing around (although you should be aware), the only thing we should focus on is the client and their needs. And hustle is fueled by Passion and Devotion. It’s a subject worth spending some serious time thinking about. Thanks Lani.

  6. BawldGuy

    February 21, 2011 at 1:45 pm

    Hey Ken — This post provides yet another topic for our enjoyment when you next find yourself in my neck of the woods. I agree that leaders generally out earn followers. But imo it’s not anywhere near axiomatic.

    I’ve known dozens of agents who, if their lives depended on it, couldn’t lead a pig to slop. But they did the things that produce results, did them well and consistently, and made ‘leader’ type coin. How? They ‘followed’ solid principles religiously, combining them with a monster work ethic. That’s what’s axiomatic.

    When’re you headin’ my way?

    • Ken Brand

      February 21, 2011 at 2:01 pm

      I don’t know Jeff, if she can attract clients who choose her and she’s leading the to the closing table, over and over. And she leads her happy clients to refer her to her friends, that’s Leadership. A monster work ethic is selling, persuasion and attraction Leadership Style by example.

      I’m gonna be in SD for the Pru Convention in March. As soon as I have my schedule nailed down, I’ll let you know. I’m look forward to buying you that beer(s) on the beach.

      See you soon Jeff.

  7. Marta Walsh

    February 26, 2011 at 2:01 am

    This post is a good idea. But I don’t think a great real estate agent must by definition be a great leader.

    He or she should be a great advisor, marketer, promoter, listener, counsellor etc.

    People will take the commands of a leader, but take the advice of a counsellor. A client can be guided, informed, maybe even influenced but only an employee should be lead.

    • Ken Brand

      March 1, 2011 at 6:41 am

      I hear you Marta. To me, the way your describing it is Leadership Style. If people trust and follow our advice, I feel that we’re leading them through the process.

      If we took a 180 and instead of Devotion and Passion we were apathetic, people would not follow our advice or believe our information or intentions. I believe we can be Leaders without making commands or demands. Thanks for reading and all the best.

  8. Heather L. Rankin

    February 28, 2011 at 8:54 pm

    Besides a Realtor I’ve been a musician for the past 26 years (ugh, scary amount of time). They are both all in fields, driven by passion and devotion. Am I tried…. sometimes. Will I stop…. nope – not till the bury me with my favorite guitar and pen!!

    • Ken Brand

      March 1, 2011 at 6:44 am

      The thing is Heather, people are or aren’t. When we are, we don’t have choice, we have to or it kills us. So rock on with playing, writing and helping – it makes you and others happy. Cheers and thanks for sharing Heather.

  9. Chris Hanson

    April 9, 2011 at 10:51 am

    Well said, nobody gets anywhere without passion, commitment, devotion and strong leadership skills. And yes, there are a bunch of real estate agents out in the marketplace with none of those qualities making an occasional deal. But, they are not building long term relationships and most like;y no one is following them for the next transaction. So, why are so many agents focused on what other people are doing? Beccause they are followers and not leaders. If you want to be successful then follow the sage advise of my grand daddy, “Son, you got to take the bull by the horns!”

  10. Christine Sutherland

    December 6, 2012 at 10:17 pm

    Ken, your points about leadership are rock solid, but also agree with Greg that there are way too many agents in the market to make this possible for everyone. If you divide the number of agents into the number of dwellings for sale in a year, you’ll see it’s less than 6.Principals keep putting on new agents in the hope that this will solve the problem, but it only makes it worse, with agents being driven to discount because of the oversupply. I’d estimate that around 2/3 of current agents need to move on to another profession.Fewer agents, with more knowledge and skills (particularly prospecting and follow up) would solve some of the problems in the industry.

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