Sarasota Real Estate brokerages face difficult decisions as house Sellers AND real estate agents demand (more) VALUE!

Of no surprise to you, the Internet is driving this inevitable change in real estate. As buyers and sellers grab the power the Internet affords them, choosing their real estate person is not just about who Cousin Marty recommends.

And real estate agents know it’s not a given to do a great job and receive your blessing to friends, family & co-workers.

Referrals are Not a given!

Last week, I met with several real estate colleagues, all of whom were aware of a couple heated discussions taking place at Sarasota realtor “meetups” regarding the future of real estate. To my surprise, my colleagues were in agreement…and agreement rarely happens.

As more consumers turn to the Internet, many agents also are forced to make business decisions.

*How important is the “brokerage name” (that is the real estate company’s name) to THEIR business success?

*What VALUE does the real estate company offer for the high commission split they demand?

*How much commission split is “fair” for the broker/brokerage company to take? Some brokers think $325.00 /transaction is a steal and realtors are crazy for not signing up. Yet, some of these brokers offer no value…even for the low(er) fee.

Increasingly, real estate agents are “out there” (virtually and literally) helping buyers and sellers. They are establishing their knowledge of their local market in person and on the Internet.

They are helping REAL people who have REAL real estate needs. Whether i person or from a distance, these agents are creating VALUE and TRUST by their knowledge, their responsiveness & their honesty about the local market.

That is, they’re not blowing smoke about the value of your house just to score a listing.

They also aren’t encouraging you to increase your offer just to score more commission.

In essence, these agents are branding themselves, not the brokerage company.

For both sellers and real estate professionals, the topic boils down to VALUE for the money.

For many Sarasota realtors, commission splits (that is, what % they earn and what % they hand to their brokerage/broker) have taken a front-and-center position as real estate changes. Today, more and more real estate licensees are standing up to brokers demanding high splits.

The brokerage name (apparently) means less and less today (and presumably even less tomorrow). According to these agents, they’re not satisfied with:

1. Brokerage name. Realtors increasingly are not sensing value from big brokerage name as they once did. Of little surprise, the big name brokerage in your town is UNKNOWN to (most) people OUTSIDE your farm area. Most brokerages'(even big brokerages’) online presence is pitiful (and easy to beat).

2. Office space. No longer is “floor time” or office space as appealing as it once was. Today, a licensee can equip a home office (or car/SUV for that matter) with the latest tech easily sufficient to accommodate a licensee’s needs and wants…relatively inexpensive.

3. Support. From discussions, these agents define “support” in 2 ways:

A). Collegial support. Collegial support & interaction today and tomorrow, however, increasingly means “meetups” outside and beyond a brokerage’s 4 walls…such as phone, email, texting, Starbucks, Barnes & Noble, etc. Not your idea of a “strategic counseling session?” Not really mine, either. It works, however, for many today and moving into tomorrow.

B). Broker support. An experienced (non-competing) broker who hasn’t spread him/herself too thin can earn his/her split counseling/mentoring inexperienced licensees. However, many of these brokers, according to these agents, can’t be reached by phone when the agent needs them.

4. Training. More updated, field-tested training can and does exist outside many brokerages. For instance, every realtor at the table agreed they HAD to go outside the brokerage to learn how to help homeowners avoid foreclosure (i.e. loan modifications and/or short sales). They had to find and create their own attorney, mortgage & tax professional contacts for referring homeowners who asked for help.

5. Lead Generation. The one important catalyst holding many high-split brokerages together today appears (from many discussions with licensees) are LEADS. Whether true or imagined, some agents who cannot generate their own leads must continue paying their broker’s high splits.

Will big-name brokerages with their big advertising budgets convince realtors paying high commission splits to keep their licenses hanging on the wall?

Or will realtors throughout the country flee real estate companies demanding high commission splits. In the group of realtors sitting around the table last week, only two hold-outs remain tethered to the big-name brokerages. And they too are on their way out.

The VALUE (in their minds) is not there.

*They have to pay for everything (signs, advertising, photocopies, telephone, MLS & Association dues, biz cards, etc).

*They farm their area, getting out and meeting people, asking to help buyers, sellers & renters.

*They have to learn how to blog, write articles, make compelling videos, optimize content for search engines and people, answer questions on buyer and seller forums, etc. They do all the work (if) they want to build a real estate business.

No doubt in my mind, the “traditional” brokerage model faces intense scrutiny from sellers, buyers & real estate licensees. Sellers demand list agents justify the “normal” 6% broker commission. Agents demand the brokerage justify splits ranging from 20-50%. That is, a realtor doing all the work, earns a $1,000 paycheck (rather “commission”) & the broker demands 20% ($200) to 50% ($500).

Less business today has top producing real estate agents to question high-commission splits. Is it worth it?

Sarasota real estate is changing for buyers, sellers & real estate professionals. More than ever, Sarasota real estate (inc. real estate throughout the country) is 100% about serving the needs of the CUSTOMER. Indeed, this topic will prompt discussion and change: How will consumers change real estate as we know it, as they are empowered more and more with Internet resources. Will real estate evolve to feature the brokerage or the individual agents at the brokerage? Will agents become more transient?

Author Bio: Sarasota Realtor Mike helps homeowners avoid foreclosure. Mike and his team also help buyers and sellers avoid costly mistakes as property values drop and 30-50% off 2006 “bubble” prices are not the bargains they appear to be. Contact me now at 941-914-9980 or Sarasota Real Estate | Sarasota Foreclosures

Category: Real Estate
Keywords: sarasota real estate, sarasota homes for sale, homes sarasota, sarasota realtor