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REALTORS® CORNER


Te 5 Myths that Builders Believe About Buyer’s Agent Realtors


underneath our feet. On the brokerage side, there are fewer agents doing more transactions, and they have less time to drive around to preview property. On the homebuilding side, marketing channels like newspaper are no longer working, and builders that embrace the agent community can thrive.


T


By ANDY BEARDEN, national director of operations for BuildersUpdate.com Bearden can be reached at 817.658.3924.


There are still lots of myths about agents that stand in the way of success. Here are some examples.


Myth #1: Bonuses Attract More Agents


Many builders are shocked that this could be called a myth. After all, builder sales normally increase when an agent bonus is offered. In addition, every time a builder offers a bonus there is an intentional increase in marketing to get the message to the agent community.


Is the increase in sales due


to the presence of a bonus, or to the increased marketing? Of course some agents are looking for bonuses, but most want a long term relationship with the client and a stream of referrals, so meeting client needs was of first importance.


A more consistent marketing outreach and possibly a smaller incentive would be more cost effective.


Myth#2: All Realtors are the same.


This is a polite way of saying that many builders believe the agent who shook them down for commissions three weeks after the contract was signed represents the entire industry. The good news is that over the last few years, the real estate industry has drawn many second career professionals, and the competitive bar has been raised. The 80/20 is alive and well and high performing agents are doing more new construction selling than ever before. The most cost effective strategy is to target the 20% and cut the expense of mass marketing to the other 80%.


Builders should abandon the flyer drops, magazine ads and other mass marketing. Find the key agents in the area and send personal marketing to them.


he downturn in housing has affected more than just the bottom line. Many of the fundamentals of the business have shifted


Myth #3: Realtors don’t add value to the transaction.


They can if the builder will let them. They can also bring value to the builder’s bottom line. Remember that agents are solely being paid to generate a lead. But, if builders focus on attracting high performing realtors, they will get a lot more for the money, including a trusted third party to help normalize a situation and set expectations. Second, they can assist in communication with buyers. This may seem like an extra step.


In reality, it is in a


builder’s best interest to have a trusted third party communicate difficult items. A happy customer costs less to maintain than an upset customer.


Myth #4: Te key in my marketing is to get agents to come to the model.


Models don’t reach agents. Customers buy on emotion and the model home is an emotional draw; it does not speak to agents. The agent’s opinion and advice is based on their head, not their heart. They want accurate information, and they don't have time to visit the model park to get it. Agents cannot sell a house with just the internet, but they certainly can NOT sell a house over the internet. They can leave the house off the list. Accurate Web sites and next generation Web services such as buildersupdate.com will help agents get the details they need to advise their client.


Myth #5: Other agents won’t look at a property marketed by a competitor.


For 40 years, agents have been cooperating on pre- owned homes and it is not an issue to cooperate on new homes either. Listing an inventory home with an agent will generate leads which a builder cannot generate by themselves. Utilizing as many marketing channels as possible is a fundamental of sales.


Because of the inherent fear in the current market, buyers are increasingly seeking agents to help them navigate new homes and provide them a certain level of peace of mind. With this in mind, builders must approach agents with fresh eyes and effective marketing tactics. The results will follow.


22 MARCH 2011 | HOUSTON BUILDER | GREATER HOUSTON BUILDERS ASSOCIATION – BUILDING A BETTER FUTURE


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