By Todd Adair
Imagine buying a new car from a dealer that only takes your money and hands you the keys, without any service department, showroom, or after-sales service. This is what many brokerages do today: they charge a hefty fee to hand over the keys. However, this traditional brokerage model is no longer reasonable or a recipe for long-term success in the modern world of real estate. It’s broken and may not be fixable.
It feels good to finally just say it. Now I’ll explain why I believe the entire industry is overdue for a complete shake-down.
For years, most standard brokerages worked something like this: a seller hired the brokerage firm (or an individual agent who hung their license at that particular brokerage), and they provided the necessary services to sell your house. But often the best things they had to offer were 1. a good location (i.e., their office); 2. MLS (Multiple Listing Service), which was contained in a fat binder that the agent usually carried around with them in the car; and 3. the brand and training that supported the brokerage. That was a big deal in the ’80s and ’90s!
Over time, the traditional model of the real estate brokerage has changed. MLS listings are now available to the public (with some exceptions), and agents often request more concessions from the brokerage. Agents sometimes contract services like staging and home inspections themselves and add extra charges to their clients. As a result, brokerages now act as little more than a clearinghouse, still taking a significant portion of your commission.
These days, that’s simply not good enough. When you’re selling a multimillion-dollar property, your most qualified prospective buyers may not even be looking on MLS. (In addition, Canada is the only country in the world that I’m aware of that has a national MLS. So where are you looking if you’re a foreign buyer?) Buyers today are much more sophisticated and intelligent; they’re going to need more than just a fresh coat of paint and maybe some nice flowers in the front porch urns to be impressed by your property.
Here’s the kicker: many brokerages today have gotten themselves into a corner that there’s really no getting out of.
If the agents in a particular brokerage have negotiated such generous commissions for themselves that there’s little profit left over for the office, the opportunity to offer added value to clients – even if the brokerage owners were so inclined – is diminished. The result is a model that’s pretty much doomed.
How can this scenario change? Instead of using flashy sales talk, why not provide valuable services that consumers can’t easily access online? Start with a different approach. I think we owe it to our clients to work hard to offer *genuine value, genuine expertise,* and services that work in *their* best interests, not just in ours. Let me give you a few examples.
I think we owe it to our clients to work hard to offer genuine value, genuine expertise, and services that work in their best interests, not just in ours.
Starting my career in software development as a young man made me realize that technology would be the future of this industry. Since the inception of Cayman Marshall, we have utilized technology to advance our clients’ needs. With 16 unique websites, a proprietary algorithm for matching sellers and buyers, and a sophisticated lead generation system, we ensure that the properties we market are exposed to an expanding audience of interested parties.
As our company has grown, we’ve added an array of in-house services that are automatically available to the clients who list with us. Cayman Marshall magazine has come to be regarded as one of the finest magazines of its type in Canada. Our team includes a host of talented in-house architects, designers, stagers, contractors, and even construction personnel whom we make available should they need any of these services.
Our exclusive listing services add value by allowing sellers to list their property only in our database, bypassing MLS. We use lead-generating software to attract pre-screened, highly qualified buyers, sparing clients the hassle of a chaotic market frenzy and upholding their privacy.
Many consumers are upset with real estate agents and feel they are paid obscene amounts for basically nothing. I truly believe this is about much more than staying competitive; it’s about survival.
The way I see it, there are only two ways that modern brokerages can go in 2023 and beyond. You can either focus on working hard to create real, demonstrable value for the clients who use your services – far beyond the outdated MLS-and-fresh-flowers route – or you just might find yourself, sooner rather than later, left behind.
