eXp Realty

Zillow Leads Vs. Realtor.com Leads

September 9, 2021Last updated on: September 9, 2021Published by: John Kinnunen 1

Leads…. all agents want them and just about everyone pays for them. A lead is like gold and a solid lead is even more valuable than that. So, it makes sense that agents and brokers would pay for an actual, real lead. I mean, at the very least this is a few thousand dollars, and that’s nothing to sneeze at.

Where do leads come from?

When you start off in real estate a lot of the leads will come directly from your brokerage. Your managing broker may allow you to take a couple of the leads that are cold calls, or those that just simply call into the office looking for information about the property and are not currently working with an agent. However, this is not the most reliable source and because most of us are working from home anyway, no one’s going to be sitting at the desk in a vacant office anyway. This is where agents need to get a little bit more creative.

Friends and family.

New agents are likely to get some of their first listings from friends and family. Even if you, as a new agent, don’t have a lot of experience, these are the folks that are likely to give you your first shot at the business. But from here, you can build your book of business through referrals, friends of friends, and if you’re good enough, your reputation will proceed you and you’ll naturally get referrals.

I have one agent that doesn’t have a website and has never advertised online a day in her life, yet being in the business for nearly 30 years, she has a steady flow of referrals and leads that come in every month making her at least $250,000 each year.

Now, I don’t necessarily recommend that for everyone. Remember, she’s been doing this for three decades. For those that are either new in the business or have been in it for a few years, you may not have built out your book of business just yet and therefore are looking for leads wherever you can.

If you’ve been in the real estate industry for any amount of time, you’ve probably already received spam phone calls, emails, and cold calls telling you that they have leads to give you hand over fist. But, those necessarily aren’t that reliable either. Good leads, solid leads, ones from people that have actually given you legitimate name, phone number, and email, are like gold and this is why a lot of places like Realtor.com and Zillow.com choose to sell these to potential agents.

But, which is better? It can be a crapshoot throwing money at a potential lead funnel not knowing whether or not those leads are actually going to close. And of course, you need to buy the lead first and as you know in real estate, you may not be able to collect on that lead for at least a month or more.

How Leads Work

Zillow.com has a service called Premier Agent that agents and brokers can sign up for that allows them to have an ad placement on property listings in particular ZIP Codes that they choose, top placement on agent finders, exposure across other affiliated sites and highlight reviews on your agent profile.

All of this allows for clients and consumers to visually see you and your services more often and more prominent eventually inciting a lead. When an interested buyer clicks on a listing, they will see that agent’s name beside it regardless of who the actual listing agent is. The buyer would then reach out to that agent to see the property.

Zillow has a variety of payment options either month-to-month or within a certain month contract and the cost of each lead depends on the average price of homes in the ZIP Code and location the agent chooses. Most agents pay anywhere from $30-$75 per 1000 impressions, meaning the number of times their contact information is presented to a buyer or client.

They also recommend paying for at least 5000 impressions per month to get the most bang for your marketing bucks. Even if just 1% of folks that see your impression contact you, that could give you a return of about $100 per lead, clearly an effective and appropriate return.

Realtor.com has a program called Connections Plus and sends out a lead to all the agents in a specific area. Whichever agent contacts the lead first has the best chance of getting the deal. Those that sign up for this type of program get automated email and text responses to their potential lead, they are allowed to track data from up to 150 different lead sources in their CRM system, they can add agents from a team into the database and share the leads with the team, and there provided all information about the lead including contact information and their recent searches.

Both companies highly recommend each agent qualifies their own lead as they cannot guarantee that this will be an actual lead that will follow through to completion.

Realtors Connection Plus is slightly less expensive than Zillow but it will also depend on the location in which you are farming and whether you’re paying extra for additional leads or more surefire leads versus colder ones. Realtor.com sends all of these cooler leads or nonexclusive leads to all the agents in a particular ZIP Code based on a first-come, first-served situation. These nonexclusive leads are also less expensive but exclusive leads, allow agents to pay to be the only agent in a specific ZIP Code.

If you’re the only agent a client is reaching out to, chances are you’re the one that’s going to get the deal. Most of these nonexclusive leads start at about $200 a month while exclusive leads cost $1000 a month. (These fees can change so it’s important to check with current listings and fee structures.)

Which is better?

Naturally, Realtor.com has more monthly users than Zillow based on the fees. However, both websites receive a lot of traffic and can be a great source of leads regardless. Just about everybody under the sun knows about Zillow.com with Realtor.com being a close second and of course, the site that gets the most traffic will naturally get the most leads. However, Zillow.com also allows for sale by owner or FSBO listings and Realtor.com does not so you’re likely to have even more potential options for clients.

The key in real estate is to find what works for you. Not everything will work for everyone. It’s important to throw a whole bunch of rocks into the pond and see what works. Find a social media that works for you, a marketing outlet, and a lead generation tool. And of course, for the best service, support, and future in real estate, join eXp Realty. Regardless of whether you get your leads, the support and backup you need to be a successful agent really comes from a fantastic brokerage.

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What is the Difference Between a Broker and an Agent?

September 2, 2021Last updated on: September 2, 2021Published by: Tim 0

Real Estate Broker Vs. Real Estate Agent. Is there a difference?

There’s been a discrepancy for years around the differences between real estate brokers and real estate agents even though, most of us that have been in the business for some time definitely know the difference. However, to new agents or to even customers and clients, the difference between a broker and an agent maybe a little bit blurry.

The biggest difference between a real estate broker and an agent

Both a broker and an agent are licensed individuals that can help buyers and sellers with a home sale or purchase. However, brokers have an additional certification even though the term is often used interchangeably. In some states, real estate brokers must have a real estate license for a minimum of two years and then pass an additional brokers exam to technically use the term broker. But in some states, a broker is at the same level as a licensed real estate agent but for most states, brokers will need additional education and testing to be qualified as a broker.

Real estate brokers are licensed to do everything a licensed agent does including negotiating and writing property purchase and sale transactions but, brokers can offer assistance to licensed agents and provide mentoring services as well. Brokers typically have a higher level of licensing which requires more continuing education and stricter exams and testing.

In today’s real estate world, many brokers actually oversee agents and verify or checkup work, offer assistance and mentoring programs even though they technically can provide all the same services to clients as a real estate agent.

Real estate brokers may be called principal brokers, broker associates, or managing brokers as they will typically oversee all the other agents within the office.

What can a real estate agent do?

There are several different terms for agents including a listing agent which represents the seller, the buyer’s agent which represents the buyer, a dual agent which can represent both buyer and seller in the same transaction, and then there is a transaction agent. A transaction agent typically works when a dual agency is not legal in a particular state. This agent oversees the entire transaction timelines for both parties but doesn’t necessarily offer advice or represent either side.

All of these licensed real estate agents can facilitate a transaction from start to finish but will typically be signing for the brokerage such as eXp Realty with the assistance of an overseeing broker.

Is it better to be a broker or an agent?

One of the biggest decisions for real estate agents coming into the industry is if it’s better to become a broker or state and agent. One of the biggest benefits of a broker is earning potential. Every agent can sell more but by becoming a broker, many brokers automatically earn higher commission because they are a broker and have more earning potential by mentoring others, assisting in transactions, and even sharing in certain commissions, splits, and stock options.

A broker is not necessarily better than an agent but a broker can work on their own where is an agent must be under a licensed broker.

So brokers make more than real estate agents?

Generally speaking, most real estate brokers have more experience, undergo more training and testing, and typically make more money than real estate agents. They are the only real estate professionals who can actually open their own brokerage, property management firm, and manage other licensed agents.

Every agent at eXp Realty has a split of 80/20 until a cap of $16,000 is met. The great thing about being an eXp Broker is that brokers can have a brokerage inside of a brokerage and are not limited on one area but can literally build an international real estate business.

More education, experience and the possibility of expanse in your own business, that’s the real difference between a broker and an agent. If you’re ready to launch your career farther than ever before, consider upgrading to a broker.

Ready to get started? Contact my office at any time.

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Part-Time Vs Full-Time Real Estate Agent

August 26, 2021Last updated on: September 2, 2021Published by: Tim 0

Part-Time Vs Full-Time Real Estate Agent – Have you been considering a career in real estate? There are a lot of questions and things to consider when you’re choosing a career in real estate. Do you want to work part-time or full-time? Why are you getting your real estate license? Are you doing it just to buy and sell your own property or to actually have a business? And, speaking of business, are you looking to have a business or just provide a service to friends and family? Part-time or full-time?

Real estate is not for the faint of heart. You have to deal with a lot of different individuals with each transaction and because the dynamics vary based on everyone involved, each transaction is going to be different. No amount of real estate education is going to prepare you for hands-on training that you’ll get through actual experience. This is why experience is almost more valuable than just basic knowledge and book smarts.

In this article, we’re going to talk about the differences between part-time and full-time agents, what might work best for you, and how much money you can make doing either.

Part-Time Vs Full-Time Real Estate Agent

Is being a part-time real estate agent worth it?

Disadvantages to being a full-time real estate agent.

You will have a full schedule. You have to manage your time effectively otherwise you will be at people’s back and call all hours of the day and night. Real estate agents tend to work around the clock because nights and weekends are the prime time for showing buyers different homes. But, this also means that you could be working when you don’t want to or setting your hours to work when you want, even though that might actually cost you some business.

Being a full-time real estate agent is a financial commitment. With prelicensing fees, state exam fees, renewal fees, and of course all of the upfront costs, marketing, and desk fees that a lot of brokerages charge, it could be a while before you actually make a profit.

How a real estate agent gets paid is usually by making a commission when they sell a home. Once you close a transaction they you usually have to split that commission with your broker. Each brokerage is different so it is hard to say what that split is going to be for you. When I started out I was with Berkshire and was on a 60/40 split and they took 7% franchise fee and I had a $21,000 cap. What that means is 60% of the commission check was mine 40% was the brokerages up to $21,000 and an additional 7% of my 60% went to the franchise and there was no cap on that 7%. Once I hit the $21,000 then they just took the 7%.

I switched to eXp Realty where they had no franchise fee and everyone is on an 80/20 split up to 16k cap. Click here to learn more about eXp Realty’s commission. At exp realty, there are no desk fees, no franchise fees and you have the opportunity to earn stock in the company. Click here to find out how much eXp real estate agents actually make.

Once you become a broker you can create your own company or you can be an associate broker for an already existing company. Click here to learn more about brokers vs associate brokers. You have to be a licensed real estate agent for a certain amount of time before you can even get your broker’s license, which means you’ll need to hang your license with a brokerage like eXp Realty.

Advantages to being a full-time real estate agent

You can get ahead of the competition by knowing the market better by being a full-time real estate agent. As a part-time agent, you may miss some of the nuances to what’s going on in the housing market, especially in niche markets, certain neighborhoods, and communities. When you are a full-time real estate agent, you stay up on these a lot better having a clear and distinct knowledge base to help buyers and sellers. As a full-time agent you’ll spend a significant amount of time focusing on market trends, inventory, and local home values as well as when things sell and how they sell. You’ll have a better understanding of the industry, which will gain you more clients and a better salary.

You probably have an easier time picking the right brokerage. Brokers want to know that you are in it to win it. Even if they have to train brand-new agents, training full-time agent means they’re likely to get the value back out of the agent. By putting in a ton of training hours for an agent that might sell one or two houses a year and do it on the weekends when they feel like it, may not be worth it. When your broker knows you are all in, they usually will be all in in backing you.

You’ll have a better schedule. If you are a part-time agent, chances are that means you are a part-time or full-time employee somewhere else. This can be difficult to make listing appointments, schedule showings, and working your day job around a real estate schedule. When you work full time, you are in control of your schedule, the hours you work, and your income and this also means that you can earn as much as you like. Your financial potential can be unlimited.

Do part-time real estate agents make money?

I know part-time real estate agents that make $100,0000 a year, and I know part time agents that make 10k per year. I have worked with 100’s of real estate agents and it always comes down to these factors. What’s your brokerages split? Does your brokerage charge a franchise fee? What does your brokerage have monthly fees? What kind of training does your brokerage offer? Are you willing to work? There is so much that goes into being a real estate agent that making a 100K your first year is hard but with the right training you can do it but chances are, you’re going to be giving that money away in the form of split commissions and transaction fees. By working full time, your income potential is unlimited and once you meet your cap at whatever brokerage you are at like here at eXp Realty it is $16,000, meaning you’ve paid into the brokerage $16k and you then get to keep 100% of your commission. There are very few if any brokerages that actually allow that allow you to keep 100% of your commission once you hit that cap usually they all have some kind of franchise fee.

More: How to Make 100K Your First Year in Real Estate

Is it hard to be a part-time real estate agent?

Being a real estate agent regardless of full-time or part-time is a giant leap of faith and a lot of investment in your time and money. Starting off as part-time might be ideal while hanging onto the steady income of your “day job”. You may not be able to make a full salary by selling real estate part-time. You will need to manage your time, budget, and effort in a variety of different ways even if you don’t have another job.

You want to dedicate at least an hour or two a day for lead generation, stick to your schedule, set clear expectations about your availability to clients, and work with a mentor to help map out your business. Make sure you get proper training even if you’re planning on doing it part-time. You want to build a concierge list of real estate professionals like handymen, appraisers, and inspectors.

More: 20 Questions to Ask When Interviewing Brokerages

How much money does a part-time real estate agent make?

It really depends on how much each agent is willing to put in and what part-time looks for you. Is part-time 20 hours a week or 30? Five hours a week or 10? Real estate truly is one of those industries that the harder and longer you work the more your potential income can grow. But, it’s important to work smarter, not necessarily longer or harder. Having a mentor map out your business plan ahead of time regardless of however many hours you want to work will put you in the right direction and maximize the time that you do work on your business.

What does it mean to be a full-time real estate agent?

I would say there are two things that really matter when it comes to a full-time real estate agent; income potential and knowledge. The longer you’re in real estate the more you learn, the more experiences you have, and the more problem-solving techniques and negotiation strategies you acquire. Plus, the more hours you put in the more earning potential you could gain.

For more information on eXp Realty and how commission splits work, what it’s like to join eXp Realty, eXp Realty Stock Options and fees, and more Part-Time Vs Full-Time Real Estate Agent Contact me below at any time.

More: The Pros and Cons of eXp Realty

20 Questions to Ask When Interviewing Brokerages

August 18, 2021Last updated on: August 18, 2021Published by: Tim 0

You’ve made the decision to switch brokerages or maybe you’re just thinking about it and want to do a little bit of research. Interviewing brokerages is really the key to finding the best place in which to work. You want a brokerage that supports their agents, offers assistance and help, and doesn’t take your full commission. We recently asked agents what they wish they knew when they got into real estate and we got a lot of answers; 100 of them in fact, and one of the main key points was finding a brokerage that really supports their agents and is available. This should be one of your number one priorities when looking for the right brokerage.

Brokerages, the managing broker can vary from office to office. So when you’re interviewing brokerages and specifically a broker in which to work under, here are the top 20 questions that get asked the most.

#1. What are the goals of the company?

Agents want to know where the company is headed. This is not just regarding market share but also what the individual brokers goals are and what it looks like for agent growth. If they’re looking to grow their agent base, it usually means they are committed to delivering tools and systems that agents need to thrive. If you and the agent are both going in the same direction, it might be a good fit.

#2. What types of training and continuing education does the brokerage provide?

By now, you probably know that continuing education is a priority and necessity of the job so it’s important to understand what the brokerage provides when it comes to continuing education. Do they allow mentorship programs? Mentors can teach new agents real-world scenarios and because legalities are always changing, agents need to understand best practices and keep mistakes minimal. Tip: eXp Realty does this really well.

#3. What are the costs?

I know I posted this under #3 but it really is one of the top questions. What are the commissions like, how will you build your business and what are the fees you might incur along the way? Ask about any hidden fees and ask other agents if they were surprised about fees once they signed on.

#4. What marketing materials are available?

Marketing is at the core of what agents do and many brokerages provide marketing materials but there are guidelines for the use of each. Brokerages may also delegate and dictate what words and images are best for promoting properties and protecting you from litigation.

#5. What are the commission splits and caps?

A brokerage cap is the amount of money an agent will pay in splits to the brokerage before that agent gets to keep 100% of earned commissions. While many brokerages offer this incentive to real estate agents, not all do. Some brokerages offer massive fees without a cap. eXp Realty is different in its approach to splits – Read more here.

#6. Does the brokerage offer training programs?

More than simply continuing education or mentorship programs, training is essential, especially for new agents. The last thing new agents want is to be thrown to the lions den and have to deal with things all by themselves. Training for different scenarios is key to managing the transaction and keeping things running smoothly.

#7. Is there favoritism in the office?

Your broker may not come right out and admit this but if there is favoritism between the agents, commissions for some and not for others, free training for top agents etc., this may be a red flag. If you are unsure, ask other agents in the office what they think of the brokerage and if they feel there is favoritism or nepotism going on.

#8. How big is the brokerage?

If a managing broker has a couple of dozen agents underneath them, that’s pretty manageable but what happens if the brokerage grows in the hundreds? Will each agent still receive the same amount of attention and consideration? Are there managing brokers that will split off and help other new agents and experienced agents?

#9. How is the administrative support?

Administrative support is huge when it comes to finding the right brokerage. Most offices will have administrative staff that will handle office details however, some admin support will also be in the form of a transaction or sales coordinator for agents such as inputting MLS information, follow-up, and contacting clients. Ask about the support and if you agree with the process.

#10. Does the company have a policy and procedure manual?

The last thing you want is to be a year or two into a brokerage only to discover there’s this manual that no one talks about but everyone should follow. Ask about this now and if it’s not automatically volunteered, that could be a red flag as well.

#11. Is there mandatory floor duty?

Will you need to sit at a desk all day at least one or two days a month? Can you work from home? What is the policy and what makes best use of the agent’s time?

#12. Are there restrictions on self-promotion?

Will each agent be able to promote themselves or the broker or both? Can each agent have their own website, picture on their business card and signage or is there major restrictions as to the location, frequency, and wording of the brokerage? Some companies have strict rules, which can be a dealbreaker for many brokers and agents.

#13. How are incoming sales distributed?

When a call comes in on a listing how are these calls handled? Do they go to the listing agent or an on-site buyer’s agent or to the general pool of agents?

#14. What is the average income of active agents in the office?

You’ve heard that old rule of thumb that your income is the average of your five closest friends and if you are in an office surrounded by other top agents and successful brokers, chances are you’re more likely to rise to that level as well.

#15. How are referrals handled?

Do agents refer each other, have a book of referrals when they are on vacation or out of town, and how do referrals happen out of the area? This is something to understand right off the bat because referrals will happen and possibly sooner than you think.

#16. What is the overall attitude and culture of the office?

Are you an agent that just wants to be left alone or do you need your hand held through most transactions? Regardless of which side of the coin you fall, you want a brokerage that gives you the freedom to do what you need to do and learn in the best possible way. An office that has a lot of new agents can feel energized but also a little chaotic. Seasoned veterans of the office can feel more stable but can also leave new agents isolated. A good combination of experienced agents and new agents can give you the best of both worlds but again, ask about the culture and see if it fits into your work ethic.

#17. What is the broker’s reputation?

Of course, the broker themselves is probably not going to be honest in this realm but asking agents in the office about the broker’s reputation and what they’ve heard in the industry can really give you a sense of what people think about the broker and the brokerage.

#18. What is the turnover?

If agents are constantly coming and going, there’s probably a reason. If the brokerage has seasoned agents that have been there for years, chances are that’s good news for your future.

#19. How are successful agents recognized?

If you’re out there all by yourself but succeeding, you probably want to be acknowledged for it. Top agents in eXp Realty and incentives so top earners and successful agents are rewarded, which incentivize all new agents to continue up the ladder.

#20. Are there any long-term benefits?

This might be in the form of stock options, investment opportunities, and other agents underneath you. If this appeals to you, this might be the right brokerage.

Remember, you can always move brokerages, but I hope these 20 questions have given you a good direction on finding the perfect brokerage in which to hang your real estate license. If eXp Realty seems like a good fit, give me a call. Let’s talk through these questions and find out if your next brokerage is right around the corner.

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Are Zero Desk Fees Really a Thing With eXp Realty?

August 13, 2021Last updated on: August 13, 2021Published by: Tim 0

eXp has zero desk fees. Yes, that is right. Essentially because eXp Realty is a virtual brokerage so it doesn’t make sense to have charges for a desk when there really is no office. However, there are certain fees associated with being an agent or broker with eXp. Similar to a typical brick-and-mortar brokerage, there are fees that go into covering overhead expenses. There are also no royalty fees or franchise fees. The revolutionary virtual office business model does away with all these additional fees unlike most traditional brokerages. Agents can keep 80% to 100% of their commissions and enjoy a low company cap. Let’s break down the fees in being an agent with eXp Realty.

Join eXp Realty Today

Upfront fees

When you join eXp Realty there is a $149 start up fee that includes 1000 business cards, a lead generation website, contact management system, membership in the Regus Business Center, toll-free phone numbers, Google apps for storage and email, brokerage membership, Skyslope Transaction Management System membership and access to eXp’s virtual campus.

Commission Splits

Agents who join eXp Realty adhere to an 80/20 commission split until that agent reaches a $16,000 annual cap, meaning you’ve paid in $16,000 and then you keep 100% for the rest of the year. eXp Realty offers equal commission splits across the board. No agent receives exclusive deals unlike many other real estate brokerages. All ages pay the same commission split in fees

regardless of tenure or transaction volume.

Transaction fees

After the $16,000 cap, there is a $250 transaction fee for the next 20 transactions and then $75 per transaction after that.

Mentor program

The eXp Mentor Program is for agents who sold fewer than three homes or properties in the past 12 months. There is an additional 20% split for the agent’s first three transactions with a local mentor.

E&O Insurance

eXp Realty covers the errors and omissions insurance by each transaction. Agents pay $40 per sale until they reach a $500 annual cap and a $25 broker review fee to ensure contracts are accurate.

Cloud Brokerage Fee

eXp Realty offers a “Cloud Brokerage Fee” which covers the brokerage’s software, online support, and other online platforms that agents may utilize. Many other brokerages have fees of over $300 a month for similar services but eXp offers it to all of their clients. It also covers a state-of-the-art CRM called kvCore. This is a real estate-specific CRM that ties in listings with a marketing backend strategy. This fee is $85 per month.

Money Back

One of the largest benefits of joining eXp Realty is that you can recover your entire commission split back as a result of hitting Icon Agent Status. This is when an agent has hit their commission cap and fees cap and is met the cultural requirements put forth by the brokerage. This means you’ve provided mentorship, offered a webinar or seminar, or generally participated in the culture of providing support to other agents. Once you are an Icon Agent, you are eligible to receive your entire commission split back in the form of equity in the company.

For agents who are top performers, they are working in a 100% commission split with the otherwise low transaction and brokerage fees, something that no other brokerage out there has. Like equity, the amount agents are earning back can be worth a lot more than their original split.

In addition to this investment, agents can get equity rewards in other ways. When ages close their first transaction each year they get $200 worth of EXPI stock. If ages introduce or sponsor an agent and they sell their first home with eXp Realty they get $400 worth of stock. This Agent Stock Purchase Plan can give ages the opportunity to buy at a 10% discount on the market value of the stock.

Example:

Let’s take an example that eXp uses. For an agent that sells around 10 to 12 homes per year and is $80,000 GCI, that agent could potentially save over $8000 per year with eXp Realty. Top producing agents to sell about 25 homes or more and generate upwards of $300,000 in GCI, their savings is about $60,000.

Join eXp Realty Today

To learn more about joining eXp Realty and how you can start saving money, investing, and getting 100% of your commission splits, contact me below. I’d love to offer more information or help you join eXp Realty today.

100 Things I Wish I’d Known Before Getting Into Real Estate

July 29, 2021Last updated on: August 5, 2021Published by: Tim 0

Work how you want, when you want… did you hear that when you got into real estate? If not, a lot of your colleagues sure did, and a lot more. Whether you’re just now getting into real estate, looking for a change, educating yourself or just need a pep talk here are 100 things most agents wish they’d known before getting into real estate:

“Brokers are not always realistic on how hard real estate will be in the beginning. It’s hard to get clients and many brokers, especially those that are trying to get you into the business are very optimistic. Most people are very disappointed when it comes to finding out that you’re not going to get a slew of clients right off the bat. Anything worth having is definitely worth working… Hard… For” Lyn Sims

“I was warned by my first broker that it could take at least six months before I saw any income. If this is taught at the beginning, agents may be able to ease themselves into real estate rather than sacrificing everything and then not having any income for a long time.” Marte Cliff

“Make sure to hang on to past clients. Those past clients can definitely be referrals for the future. With my first brokerage, when the transaction closed, the file went in a drawer and the people were forgotten. I missed out on a lot of repeat business and referrals in the years before I learned that lesson.”

“This is not a business for squeamish, fearful, or impatient people.” Mike Cooper

“Learn to live on the income you made in your worst year and save tons of money.” Caroline Gerardo

“I wish my first broker would’ve told me how many people waste your time if you’re too nice at first.” Candice Donofrio

“I didn’t realize how expensive getting into real estate was. You have your license, marketing, desk fees, monthly fees, transaction fees, and that’s all before you really even made a sale. Make sure you understand all of the costs involved before getting into real estate.”

“Have the money to survive for a year without a commission check.”

“Look and smell good. If your client can’t stand to be in your midst, you’re in trouble.” – Richard Mellen

“The articulate but don’t talk over your clients. Don’t nervously chatter or make too much small talk but allow pregnant pauses and communication to allow everyone to think and respond.”

“Have tools handy to measure, repair, unstick stuff, and quickly provide information or calculations that buyers might need.”

“As soon as you receive a contract, immediately respond that you have received it even if you haven’t read it all the way through just yet. Clarity is kindness and response is considerate.”

“Do not yell or argue with anyone. Listen and respond thoughtfully. Remember, this client is your next referral source.”

“Don’t take what you are doing lightly. You are in this business to walk your clients to the most risky expenditure of their lives. Don’t be high-pressure, don’t panic sell, and don’t pretend others have interests if they really don’t. Don’t be perceived as a liar or a bully. People remember things for a long time.”

“Do what you can to get along for the sake of the deal, your clients, your business, and your reputation even if it means you may have to do more work.”

“Stay in control of your daily tasks. Keep things organized so that clients know you have everything together, everything on track, and they feel less stressed because you got everything handled.”

“Many agents come in with rose-colored glasses and leave with a new respect for how difficult the businesses. Learn all you can ahead of time and your expectations won’t be that outlandish.

“Don’t necessarily spew stats and talk about the market. No one ever got hired by firing off stats. You get hired by being interested in helping someone.” Chris Ann Cleland

“Know when to talk and when to listen.” Scott Godzyk

“Be prompt. Respect other people’s time including other agents, appraisers, inspectors, and lenders.” Fern Hamberger

“Learn something from everyone you meet.” – Scott Startsman

“Always, always, always do what you say you’re going to do.” Kat Palmiotti

“Find a good mentor, which may not always be your broker, Because leaning on your own can add to so many more issues later on.” Margaret Goss

“What is pertinent is always passed down so it can continue.” Richie Alan Nagger

“You are the employee, not the employer. Your direction in response to offers, counter offers, questions, etc. comes from the seller and buyer you are working for.” Jamie King

“Make sure you have filled out the contracts completely. As a lender, I get contracts where the agents have not filled them out completely or it is not legible. I am amazed that some don’t even answer emails.” Dora Griffin

“Having high grooming standards reflects on your personality. Remember how you look to others including everyone in the industry as well as your clients.” Mary Hutchinson

“Desperation leads people to make crazy decisions and other people can sense it too. Having plenty of resources is critical to any agent especially those with a new pipeline of clients.” Deb Janes

“You can change your clothes, your hair, but your reputation follows you everywhere” Mary Jo Quay

“Don’t wear too much cologne either.” – Alex Heyen

“Be accessible and willing to communicate. This goes for anyone involved in the transaction including clients and professionals alike. It’s beyond frustrating when people go MIA” Gene Mundt

“If you don’t feel right about someone don’t work with them.” Pat Starnes

“Build a database. Absolutely everyone you ever worked for should be included in your database and book of business. They should receive follow-up every once in a while and be reminded that you still are in real estate. You need to be there when they go to when they need to buy or sell in the future.”

“Make sure you follow up. The old saying ‘the fortune is in the follow-up’ couldn’t be more true. 80% of sales are made on the 5^th to 12^th contact so just because they don’t respond right away, doesn’t mean they won’t in the future.”

“Shift from employee to entrepreneur mindset. Real estate agents are 1099 contractors so, even though the skies the limit, there is no floor in real estate.”

“Set at least 15% to 30% aside to pay your taxes come April.” – Matthew Kennedy

“Be kind but don’t let people take advantage of you. I had two families that promised they would let me sell both homes and by their next home if I gave them a 1% commission on the first house. I did and then I never saw them again.”

“Focus on sellers, not just listings. What do sellers really want out of selling their home? That’s different than just getting a listing.”

“This is a business of relationships; it always has been and it always will be regardless of technology. Make sure you build relationships and ask everyone for their business.”

“Sometimes you have to take action and force yourself to do what you are afraid of. Be confident and get over the fear of just doing it.” – Dave Van Nus

“Set goals every single year and then set out a coaching plan to achieve those goals.” The Bell Team

“Are you going to be at everyone’s beck and call or will you have set hours? Some people think they get into real estate to set their own hours and have a lot of free time. This is exactly opposite of usually what is true.”- Chuck Gonzalez

“Have the right work ethic and train harder like a professional athlete would. Commit to coaching and training to improve your skills and confidence.”

“The relationship with your lender can mean everything. If you have a bad connection with a bad lender, you will be frustrated the entire way through. A great lender can help you get to closing and solve problems before you even have to ask.”

“Just because you show a buyer that has everything they wanted doesn’t mean that’s the home they really want. People will always find something they don’t like about the house. Try to remind them what they’re buying, why they are buying, and how much they can afford.” John Kinnunen

“Unfortunately, in this business, you have to pay to play. It costs money to get business. You have to spend money to make money; that is nowhere more true than in the real estate industry.”- Deeley Chester

“Anyone can sell a house, you are selling YOU. Why would someone want to buy a house from you rather than someone else?

“This is a feast or famine business. One month you could have 10 closings and get a boatload of money in the next month not have any. The key is to live below your means and budget your money well. Save any leftover money for those lean months.” Trace Lee

“Never count, and especially never spend, commissions before they close. You might think that a payday is coming but anything can happen at the last minute and if you’ve already spent that money, you find yourself in a world of hurt.” – Don Payne

“Real estate isn’t for everyone but it can be extremely fun. Don’t forget why you are in this business and don’t forget to have fun.”- Joe Sisneros

“Not all brokers support their agents. It may be time to move your license to an agent and a brokerage that actually supports, encourages, and assists their agents.”

“Talk with an accountant immediately. Get your money set up correctly from the beginning so you don’t make any mistakes or have any tax issues.”

“Sit down and talk with another agent before getting into real estate. Ask them what they like and dislike about the business and their personal journey and adventure that got them into this business.” Knieper Team

“Take continuing education courses that you really like. As a real estate agent you have to keep up with your education and knowledge in real estate and while a lot of these courses don’t actually give you hands-on, on-the-job training, you can learn quite a bit about appraisals, construction, and home inspections as well.” – Erika Rogers

“Determine your short-term and long-term goals. Where do you want to go with real estate as your career? What would you like to accomplish? Are you looking to leave a legacy or just make a paycheck?” JoAnn Dickinson

“Have a checklist ready to go. I am a list person so we need to know every detail of the process and when I need to accomplish that task. Timing is of the essence in real estate and as long as you have everything down and you make a check list for every transaction, you should stay on task.”

“Start a database. Make sure you have enough money to create a content relationship management system and make sure you create data on how you know the client, whether they are homeowners, buyers, sellers, or renters.” – Marcus Brown

“Choose 3 to 4 sources of primary business. Don’t put all of your eggs in one basket as in letting your website do everything for you. Have several different sources of lead generation. Work a few social medias and find what works for you and then work it hard.” Billy Rabbitt

“Get active on social media. Most real estate agents are through referrals these days so make sure you build a good relationship on your social media and whichever one you choose, work it every day.” – Alexander Gutierrez

“Stay consistent. Consistency will pay off every time so it’s important to build out time blocks and track your results on your daily schedule, getting leads, and follow through.”

“Choose your brokerage office wisely. Make sure you interview with at least three or four different offices to get a feel for the way that they do business. The people in your office are just as important to your success as you are.” Drew Laughlin

“Use QuickBooks or some other accounting software to keep things straight so that you know what you have used for business, how much income you have, and how much will need to save for taxes.” – Eve Alexander

“Don’t forget to do a little investing on your own. Being real estate agent means that you might find some of the best deals first and these can turn into lucrative rental properties.”

“You don’t have to do everything yourself. By using a virtual assistant you can keep things organized, keep your process bulletproof, and document everything. This might be a little hard right out of the gate, but it is definitely a benefit in the future.” Tonya Peek

“Be teachable. Make sure that you learn something from every single transaction whether you have failed and learn something or whether it’s a success. Every person will teach you something; is up to you to pay attention to what they’re teaching you.” Miggins Real Estate

“Surround yourself with like-minded people. Hang out with the successful real estate agents and ask questions, observe, and emulate.”

“Learn how to problem solve and find solutions. If you don’t know the solution right away, tell your client or vendor that you’ll come back to it after you have done some research. Being willing to find a solution works wonders for relationships.”

“Seek first to understand before being understood. This little habit from the 7 Habits of Highly Effective People is good advice in life regardless of your profession. Try to understand where everyone is coming from the forgetting your own point across. You might be right, but at least you know where they’re coming from.”

“Not everybody cares that you are a Realtor®. Your brokerage may require you to be a member of the National Association of Realtors, but most clients don’t really understand the difference between a licensed agent, broker, and Realtor. Just the ethical regardless of your title.” Sara Mehrpouyan

“85% of what we do is service and just 15% is sales. It’s all about hospitality and relationships. This service-based business will only thrive from someone who understands that first, and sales and a paycheck second.” Ellen Bruya

“Never be afraid to ask. Ask questions, learn from those that have been there and done that, and be grateful for the information.” Jackie Barikhan

“Make sure you have a clear vision and mission. Make sure you know your values, beliefs, your mission, and your vision to define how you’re going to do this business. If they are cloudy, it’s time to take a step back and really define what it is you’re working for.”

“Design your brand. This may or may not happen right out of the gate but the sooner you brand yourself and then advertise your branding, the more often people will recognize you, know you, trust you, and turn to you for real estate.” Todd Blair

“Ask for reviews. Never forget to ask a client for review. Zillow, Facebook, Google are all good choices and the more reviews, especially the more five-star reviews you have, the more trustworthy and authoritative you become.”

“Drop what’s not working. There are a lot of things you can try in real estate but not everything is going to work or work for you. Determine quickly what is not working and move onto the next thing before wasting too much time and energy.” Frank and Karen Baker

“Treat this like a business because that’s what it is. Are you treating it as a service or as a business? When you treated as a business and you are the lead, it’s a different mindset that helps you progress faster and be more successful than simply trying to keep up with the service.” Dale Corpus

“Stay healthy. Remember, you’re going to be following buyers and sellers throughout the house, may be up into the attic or basement, and you don’t want to be out of breath or seem like you can’t handle moving around a property.”

“Have passion. If you don’t have passion, you’re not going to love this job and it’s going to show. If you don’t love it leave it.” David Fleming

“Don’t be afraid to lose a deal. It can be exciting right out of the gate to get a deal or get an offer accepted or an offer on the table but don’t be afraid to walk away and this is something you should share with your clients as well. If things are getting too difficult, there are too many red flags, or the deal is just struggling to go through, it may not be meant to be.”

“Plan days off and family time in advance. This business can definitely burn you out so you need to have family time, loan time, and vacation time. Unfortunately, with deals going all of the time it can be difficult so plan ahead and prepare for the time off.” The Gellman Team

“Have a backup plan. When you do go on vacation, make sure that you have someone that can cover your deals while you are gone. Make sure it’s someone trustworthy that won’t steal your client but that will be honorable educated, and well-versed in all of your transactions.” A.D. Whitehurst

“Don’t be afraid to fire a client. We can interview clients just as easily as they can interview us and not everybody’s gonna work with everybody. Sometimes it just doesn’t work out and you’ll need to know when to walk away.”

“Know why people fail. Knowing how and why people succeed is just as important as why people fail. Avoiding mistakes, learning from other’s mistakes, and learning when to walk away is crucial.” PMD Realty

“Plan your income with a sales funnel approach. It’s important to know your present and future expenses both personal and business so develop an income budget like an expense budget to come up with a realistic estimate of what you expect for income the first year or so.”

“Figure out if you really want to split your commission. When you first get started, you’ll likely split the commission with your brokerage but every single brokerage office is different and may require different fees. Some may let you keep 100% of your commission in exchange for desk fees and transaction fees. It’s fine to give up part of your commission while you are learning, especially if you get help in return, but as you grow, you may want to branch out on your own.” Gregg Camp

“Don’t be a broker if you don’t really want to be. A licensed agent can buy and sell real estate just as well as a broker can but unless you’re planning on going out on your own, you might consider just staying as a licensed agent. You can learn more as a broker but it may not matter to your client.”

“Make sure people can get a hold of you. There’s nothing worse than a real estate agent that never answers her phone, text, or emails when a client really needs them to.”

“Find your marketing niche. Maybe it’s probate, foreclosures, lake homes, condominiums, etc.… You get the point. Find what you’re good at and then market to that regardless of whether you can buy and sell other properties. People want to know that you’re good at what you know.” Joe Hayden

“You only use about 5% of what you learn in pre-licensing class. Just because you took the classes and pass the test doesn’t mean any of what you just learned will be within your first few transactions. Just be prepared for that.” Preston Russ

“It’s harder than you think.”

“Don’t be offended if friends and family don’t want to work with you. Remember, this is hundreds of thousands of dollars they are dealing with and as an amateur, they may not want to deal with you right away. Try not to be offended and just move on to your next client.”

There will be ebbs and flows and you’ll assume you’ve made a huge mistake. But again, power through, learn from any mistakes, and when you get overwhelmed, try to get things out of your head and onto paper.” Michael Friedman

“Your earning potential is unlimited. This is not an hourly or salary-based job and most real estate agents receive an income largely dictated by the time they invest in clients and sales. I’m not saying you have to work 24 hours a day, but if you did, your income could be limitless.”

“Manager time effectively. Clients can take advantage of your time in a heartbeat so make sure you have boundaries, you’re not necessarily at their beck and call, and people know that they can get a hold of you when they need to.”

“Real estate can be very rewarding. Seeing someone get into their first house, receiving a check from the sale of their home, or just making a major move can be quite rewarding. Don’t forget to stop and enjoy the process and the journey once in a while.” Kenny Raymond

“Get use to a desk job. Yes, you’ll be out in the field during homes, walking properties, and putting up open house signs, but a lot of it is a desk job and you might be doing a lot of administrative work; more than you originally anticipated. Just be prepared.”

“Some days you’ll work longer hours than others… And that’s just the nature of the beast.” Tina Saporito

“Try to get along with other agents; you’ll be working with quite a few of them in your area.”

“Don’t be that guy. You know, the one that nobody wants to work with.”

“You won’t sell a house and get your paycheck the same day. From start to finish, it can take 30 days or more once your client starts the process. Then after closing, escrow will disburse the funds at which point then you’ll get your commission check.” Jean Wawrznyiak-Fry

“Consider getting your license in multiple states. This could actually help you in the long run, especially if you live in a location that’s close to a state line. A lot of people move from one state to another and back and forth so being licensed in both areas in multiple counties can really be a benefit to your business.” Sam Resnick

“You may get sued. Nobody wants to hear that but it’s kind of the reality. You might be called into court because someone else is suing someone and if there are issues on the home description or incorrect information, it could lead to a lawsuit so it’s important to cross your T’s and dot your I’s and watch your P’s and Q’s.”

[Source]

eXp Realty – Become an empowered real estate agent – Focused coaching, accountability & team support – John Kinnunen

More Advice for Agents:

eXp Realty Stock 101: What you need to know as an agent

Contact Me At Any Time for More Information on Brokerages and Real Estate Agency

What Experienced Agents REALLY Want in a Brokerage

July 23, 2021Last updated on: August 10, 2021Published by: John Kinnunen 1

What do agents really want in a brokerage? The consensus is clear. Attention and Integrity. I think both of these cover a lot of ground. Agents change brokerages all the time, but why? What makes them switch? One suggestion could be the mere fact they are becoming brokers themselves and while some go this route, it’s usually not the majority. Most want and appreciate the care and responsibility of hanging their license with a qualified broker.

The agent doesn’t have to pay the extra taxes and insurance but they also won’t get the full benefit of doing things “their way”. While some brokerages allow for a free-for-all agency, some are quite strict and confine their agents to tough standards and limitations.

But what makes a good brokerage? For the client and the agent? I did some digging to find out what agents really want. To be left alone? To have their hand held? No restrictions? Surprisingly it came down to attention and integrity. Here’s what some agents had to say when asked:

What would make you change brokerages? Why would you go to one brokerage over another?

“We’ve switched once (different franchise office, same brand) and it was because of different rules for different agents. Some agents were allowed to have direct phone lines on their signs, and we were told “no” when we asked and were told “it wouldn’t make any difference to our business”. The brokers just wanted to feed the duty desk agents. We’d work to get listings and every new listing someone from our office would show the new listing within the first 24 hours on market.” – Bill

“Years ago before I opened our own firm the broker I had been with said for years – we are here to serve you. Well, they hired on more brokers because they were huge by then…. And quality went way down.” – Anna Kruchten

“The integrity of the Designated broker or owner. I switched offices twice for that reason.” – Carol

“Lack of availability on the part of the broker or manager to answer questions or help if needed. That’s why I left Prudential. My broker had 10 offices and when it was necessary for me to talk to him he was not often immediately available. So I got a Brokers license. And then I started wondering why I was paying someone that wasn’t available” – Candice Donofrio

“ My former broker was rarely available and the one time I asked him to review an offer he asked why I wanted him to look at it. I was new was why. He could not care less” – Mike Cooper

“One reputation over the other. My former brokerage had my friends refuse to list with me because of the broker and the other agents all of whom were less desirable people” – Susan

“Atmosphere/management – a poor manager, poor training, bad attitude of management, lack of support for agents – can all make one particular office much less desirable than another.” – Kat Palmiotti

Help When Needed

This clearly is a necessity, even with experienced agents. Some just want to be loosed and run with it but when the time comes, they need help, attention and consideration. We all want to be validated and when you’re giving up some of your transaction money, either in a transaction fee, desk fee or split, you want that money to count for something, not just the insurance you know they’re carrying for you. Whether you are a first-time agent or have been in the office for 10 years, your broker is your lifeline when needed.

What Experienced Agents REALLY Want in a Brokerage

Integrity

No one likes needy agents but brokers that are not available, irresponsible, annoyed at you or just plain rude makes a work environment that causes chaos, frustration and resentment. If no one wants to work with your broker as Susan said above, it not only affects the brokerage but the individual agent’s livelihood. That alone should prompt an agent to switch brokerages.

“I’ve been with eXp Realty since I started and have grown my business in just one year to the top closing agent in my Texas area. I know that the support and flexibility has motivated me to push past many of my colleagues.” – David Fleming, eXp Agent

Growing and Learning

We all need to grow and learn, otherwise, we die on the vine. But that’s exactly what some brokerages do and their agents can follow suit. If a brokerage is stuck in the 20th century, newer, more tech-driven brokerages are going to fly by them at warp speed. For a brokerage to keep up with its agents and the real estate industry, it must learn to adapt, grow, change, and learn. Clients expect it and agents should as well.

“I never really needed my mgr for many years. We disagreed on many fronts but I respected our differing opinions. Now I don’t talk to my broker at all as I consider him useless. The manager can make or break the office that is true. I also think that the overall thoughts of the office regarding new technology is important. You gotta learn to grow. –” Lyn

A Great Brokerage – Education, Partnership, Attention, Integrity

The four cornerstones of a great brokerage. This not only will offer you a great place to hang your license but will grow your business because more clients will want to work with you and the brokerage and agents will tend to be more productive with better support when they need it. If the word gets out the brokerage support and encourages their agents, there is no better advertising.

eXp Realty – Become an empowered real estate agent – Focused coaching, accountability & team support – John Kinnunen

More Advice for Agents:

eXp Realty Stock 101: What you need to know as an agent

Contact Me At Any Time for More Information on Brokerages and Real Estate Agency

What is Ownerly? How to Properly Value a Home

July 15, 2021Last updated on: July 15, 2021Published by: Tim 0

What is Ownerly? How to Properly Value a Home

Ownerly.com says that they take “the guesswork out of your home value estimate”, but don’t a lot of other home valuation websites do the same? How accurate are they and who do you go to when you need a professional grade estimate of a particular property’s value?

What is Ownerly?

Ownerly is a free home valuation tool that was created in 2018 and provides data and insight into the hands of anyone. We all know that a family’s largest asset is typically the house so what Ownerly does is put the information that is typically available only to real estate agents into the hands of the general public.

Ownerly uses decades of experience in data with a team that understands the value of that data. The idea behind the Ownerly Tool is to bridge the gap to equip homeowners with the insight to make the right investment decisions. Ownerly also provides information on mortgage rates, lenders and loan providers, homeowners insurance, and even home renovation costs. Even though a lot of this information is readily available to the general public, Ownerly offers all of it at one location. This web-based tool is also an app available on both Google Play and the Apple Store.

With the app, you can check the home’s valued estimate, get notified when there are new updates on that value, see recent sales data about a neighborhood and check the property’s appreciation and history.

How much does it cost?

Ownerly is free to anyone and the process works in three steps; search for other properties’ addresses, provide a little bit more information about the sale or home situation, enter an email to get a free report. The mission is to bring the data that professionals use directly to the homeowners but is it accurate?

We’ve Artie talked about how Zillow’s Zestimate can be wildly inaccurate and many of these companies use the same automated valuation models that all the rest of them use. These algorithms to compare data that the user provides so the more data that a user or multiple users provide, the more accurate the valuation can become.

The company’s algorithm analyzes similar homes in the area just like a real estate agent or appraiser might do. The difference is that Ownerly shows all this information in one location. The goal is so that the user doesn’t have to visit multiple websites to get the information they need.

Any Downsides?

Because the application uses user data, if there is not enough user data, the algorithm may not be able to give an accurate estimate or valuation. This is a relatively new platform and there are not a lot of reviews or even users in order to make the platform accurate. The pricing model is not fully developed and currently, the company is making a profit by selling its user’s data to other real estate agents, banks, lenders, and other real estate professionals. These professionals join a partner network and the company uses paid advertising and content marketing to capture web traffic and then cells that lead to their partner network.

Should you join the Partner Network?

Joining Ownerly’s partner network may be worth it if you have the time and budget to explore a new lead source. There are currently 50,000 users, which can provide a lot of high-quality leads. On their website are looking to buy or sell a home so this could be a lucrative source for new leads.

Is it worth it?

That all depends on your area, if you’d like to broaden where you receive leads from, and how comfortable you feel jumping into a relatively new business. It has been around for about a decade and plans to keep growing. Even though doesn’t have a lot of reviews now, we are finding that it provides legitimate data and can give real estate agents access to leads. Of course, the ultimate estimate really comes from an appraisal and a qualified real estate agent that can provide an accurate CMA.

For more information or if you have questions about Ownerly.com let me know at any time.

More Advice for Agents:

How to Calculate a CMA: Comparative Market Analysis

July 9, 2021Last updated on: August 10, 2021Published by: John Kinnunen 0

Creating or calculating a CMA or comparative market analysis is one of the first things real estate agent should know how to do. This is one of the major ways real estate agents price a home to be competitive in the current market. Regardless of the market, the CMA may change from week to week or month to month but it’s important to understand how to calculate a CMA not only for your fiduciary duty as a real estate agent but to gain an overall accurate sense of them current market.

What is a CMA

A CMA stands for “comparative market analysis” or sometimes “competitive Market Analysis”. The process is finding similar properties to the one that you are trying to sell and comparing the estimated home value of one home to another. It’s similar to an appraisal without actually being an appraisal. A CMA is determined by the real estate agent rather than an appraiser and is all part of the buying and selling process.

A CMA is the best way to determine the market value of a property. This crucial tool for listing agents is the key to getting a home shown quickly and sold fast. However, learning to complete and accurately calculate a CMA isn’t normally taught in real estate education courses. Many real estate agents get into the business without the necessary training or strategies for a CMA. For a real estate agent, generating a timely and accurate CMA is one of the best tools to gain new business and prospective clients.

Isn’t a CMA the same thing as the Zillow Zestimate?

The famous Zillow Zestimate is a controversial tool that the big real estate company uses to entice sellers with the prospect of what their home could be worth. The biggest problem with this analysis is that Zillow can only pull information from public records. It lacks the local information about the neighborhoods, changes to the house, and other details that might affect the current value. In one article by the Seattle Times, Zillow’s Zestimate overvalued a Washington state home by 700%. This is definitely a case of algorithms gone wrong. While a 700% over market value might sound attractive to sellers, chances are you’re not going to get the buyer to bite.

How to calculate a CMA

#1. Gather all the information and data about the property.

The best way to start out calculating a CMA is to gather as much information as possible about the property. You will need to gather at the bare minimum including but not limited to:

Location, address, municipality
Total square footage including, and garage
Number of bedrooms and bathrooms
Total number of rooms
Acreage if applicable
Year built
Recent renovations and remodeling projects
Interior finishes and materials
External or additional features such as swimming pools, outbuildings, barns, and elaborate landscaping

#2. Collect tax information

Information from the local tax assessor will provide you with some basis of standard about the property. Not all property taxes are created equal and a lot of municipalities have different tax rates so it’s important to understand the subject property and surrounding properties and factor in the tax assessment is typically lower than market value. The tax information should point out the millage rate (or mill rate, the amount of tax payable per dollar of a property’s value) and the properties assessed value to compare your final valuation two.

#3. Collect the properties previous sale or listing data.

While this is not the end all/be all for a CMA, it can give you a good idea in determining the market value of the house, as one of the most important factors of determining market value is the market itself.

An appraiser will typically gather all recently sold listings that match the subject property as close as possible. However, there’s more information to be gleaned from the actual subject property sale compared to the market at time of sale. For instance, the last time the property was sold it may have gone under contract in a couple of days. This information can suggest that there was significant demand for the property. This also could mean that the previous sale left money on the table, something that appraisers and real estate agents take into account.

The list price, final sale price, terms, any price adjustments, and days on the market will be important data in determining the best CMA for the property currently.

Even collecting unsold listing data is important in a comparative market analysis. If the property was listed and never sold, this also plays a part in the current market. For whatever reason, if the property didn’t sell, it’s important to compare the reasons behind that unsold listing and today. Have there been renovations completed? Did a home inspection reveal too many issues? Finding out the reason that the listing did not sell can help you price it correctly this time.

#4. Recent comparable sales.

Here we go; this is where you get to look at recently sold properties that are similar to the subject property. In hot markets, it may be beneficial to only go back three months and in certain markets only back one month, especially if there are a lot of homes being sold. However, most appraisers look back at least six months to get a good idea of the market in a particular area and similar to the subject property over the last six months. This really is the heart of what a CMA is as an appraiser would up or down based on similar or different features.

Using the MLS, locate 4 to 6 sold properties that match or are as close to the subject property as possible. The closer the sale price to the listing, the more accurate those comparable sales will be. If you are very limited in comparable sales, you may need to go back even farther.

If there are limited sales or no exact matches exist, you may need to expand your criteria to get better results. Custom homes, luxury homes, or properties in smaller communities often have this challenge. However, try not to allow different housing types into the equation. Condo living, townhouse living, and single detached properties are all quite different from each other.

#5. Compare existing properties for sale.

Think of it this way, if there are three homes currently on the market that are similar to the subject property and all of them are priced within $20,000 of each other, the best way to sell the property quickly is to offer something more for less. This doesn’t necessarily have to mean if you have a similar property with better features and you price it the same horse just slightly below the next similar property, chances are that home will sell faster.

As a real estate agent, contact the listing agent of a property that is recently gone under contract. If you informed that listing agent that you have a property that’s similar going on the market soon, they may have other buyers waiting in the wings. This could make for a quick sale an excellent possibility.

#6. Don’t neglect the micro-market.

It’s amazing how markets can change from one neighborhood to another, even with in a one square mile. You’ll want to know what’s happening with in the neighborhood in which you are listing. If there’s a major road construction going on in one neighborhood, train tracks through another, or an established neighborhood just one block over with mature landscaping and a quieter atmosphere, all of those factors will play into the price of the subject property. Ask yourself if there’s anything happening in the immediate area of the property that could drive the price of the home up or down?

#7. Putting it all together.

Once you’ve started with the properties history, considered comparables and micro trends, you’ll want to package the results up into a listing presentation. Showing your work, putting together a short but concise report demonstrating how you came up with the number is going to increase your clients a buy-in and up your chances of getting the listing.

What about difficult, rare, or fixer-upper properties?

Not every home is going to be a cookie-cutter, crystal-clear, cut and dry comparable. You may run across uniquely remodeled homes, custom homes with extravagant layouts and architectural designs, or fixer-upper properties. All of these require unique CMA situations. For a fixer-upper, you can determine it as either nice, average, or needs work. For remodeled homes, make sure you specify in the MLS search the upgrades because it can greatly affect the homes value in comparison with properties that are newly constructed or of had multiple upgrades over time. For properties in rural areas such as farms, you may need to be more flexible with your filters and extend your search back at least one year.

FAQ for CMA:

What is the difference between a CMA and an appraisal?

There are subtle differences but the biggest being the appraisal is conducted by a licensed appraiser, understanding the current value for purposes of lending or insurance. A CMA is performed by a real estate agent to determine list or sale price.

What if the range of comparables is too wide?

If your comparables are not similar enough to the subject property you may need to readjust your comparables and find out if your overestimating or underestimating certain markets and whether or not you can adjust based on more comparables versus less.

How many comparables should you use in a CMA?

The more comparables the better as long as they are accurate. Offering a homeowner dozens of comparables when doing a CMA may seem a little overkill but when determining the price, finding the good, better, best scenario and offering the seller three or four comparables when you actually did your research with 10 or 12 is the best way to go.

Where should you get comps data?

The most accurate place to get your comparable information is from the local MLS. Big real estate companies are usually skewed and their algorithms can be off so tax records and the local MLS are usually the best. Third-party sites may not give you an accurate history of the property such as days on the market and price changes.

Calculating the correct CMA for a home does take some research, time, and experience. Utilizing all tools available, being as accurate as possible, and then being confident in your listing presentation will likely garner you the business and revenue you need.

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