So you think you want to be a Realtor?!

It's not uncommon to run into someone who wishes to pick my brain about becoming a Realtor. The lead in conversation is often something like this: "my family (or friends) think I'd be a great Realtor because I like houses and like people."

Of course those two qualities are excellent for a Realtor! Probing further I will ask, "how is your tolerance for stress?" If the answer is that the person does not handle stress well, I recommend a different career choice. My next question is, "how well do you handle rejection?" If the person says they wilt when rejected, once again I recommend a different career choice.

Unlike traditional jobs, in real estate you don't get paid until a successful sale completes! Just because you're working hard does not guarantee a paycheck. What's more, there is more work involved in collapsed sales than in successful ones! When I first started in the business I remember a more veteran Realtor commenting that you never really relax in this work. You can have a cheque in hand for 20,000 yet you have no idea where and when you'll earn your next pay! Meanwhile, expenses are no respecters of successful deals! Advertising, vehicle, computer, phone, office, franchise, board association, insurance, camera, income tax, HST and education costs roll merrily along with marked enthusiasm! You simply cannot "coast" in this business. A seasoned Realtor recently remarked that it costs an individual Realtor in the vicinity of 50,000+ per year to maintain a strong presence in the profession!

Being honest, earnest, keen and enthusiastic will be of great benefit; but you will often be rejected in favour of a budget brokerage or a Realtor with a great spiel! People often say that "its business, its nothing personal." However in a heartfelt endeavour, it sure feels personal! So, you need to learn how to manage your emotions in the roller coaster amusement park which is real estate!

There is a whopping percentage of people who enroll in the University course to become a Realtor that never successfully pass the exams. The number of new Realtors who last more than a few years is also slim.

All this being said, this is a wonderful, wild, fun and delightful line of work! You are guaranteed wonderful highs and significant disappointments! You have the chance to play a meaningful, strategic part in people's lives. It is a career of lifelong learning. And, just when you think you've seen it all...a new twist of human nature takes a swipe at one of your deals.

The best in the business maintain their dignity and poise under pressure. They are true professionals with tremendous responsibility.

The requirements are huge and the rewards can be great. My best advice if you're seriously considering this as a career is to have a good heart to heart with a Realtor you trust and really get an inside look at what your life will be like as your own boss with very robust competitors!

And some think we get paid too much! If they only knew....

Buyer beware...especially of fsbo's

Now before you go jumping to the concussion that I'm just trying to get you to use a Realtor, just consider on fact alone what I'm writing about.

In BC the Real Estate profession is tightly monitored and Realtors are held to a standard bordering ridiculous on matters of disclosure -- disclosure on remuneration but more importantly disclosure on any known faults in a home they're marketing.

Transactions taking place within the fold of organized real estate also have insurance protection and an organized body (Real Estate Council of BC) to handle any grievances that may arise.

In addition, Realtors have to take identification from prospective buyers or sellers and have to report any large cash transactions or anything which raises suspicion at all to do with the transaction.

Realtors are held accountable and the profession is held accountable for all transactions using a licensed Realtor to give the security that sales are above board, clear and clean. All monies are held in trust at each stage of the transaction as well.

Shockingly private sales are held to no such standards other than the court system. A private seller does not necessarily fill out a property disclosure statement (mandatory for all Realtor sales). It is strictly buyer beware.

Yes, you can and should use a lawyer for privates sales -- but has your lawyer been to the property? Have they met the buyer or seller on the other side? Do they know if an inspection took place or if strata minutes are acceptable? Not usually.

Before becoming a Realtor I have on more than one occasion bought or sold privately. I did not know then what I know now! I fully realize that many trade in good faith. Just be very, very careful.

If I wanted to sell a grow op or launder money I sure wouldn't do it through organized Real Estate! If I wanted to hide a fault in the home, I sure wouldn't want a trained Realtor taking the listing! If I built without permits or final building inspections I sure wouldn't want that highlighted on a property disclosure statement. If I was over pricing I sure wouldn't want a Realtor aiding a buyer with comparables.

In BC sellers pay the real estate commission. Why any buyer would not use the services of a professional is a complete mystery. Savvy sellers need no convincing to use a Realtor. I challenge you to find any real estate mogul, investor or financier dealing with real estate investments and sales that doesn't use licensed Realtors.

There's a reason great Realtors are worth their weight in gold. To serve and protect. To serve and prosper. To serve and promote.

often the 1st is best

Often times Realtors see that the first offer is often the best offer. There is an understandable tendency for sellers to think "that was too easy, my home must be undervalued" if they get an offer shortly after listing.

Let me relate a true story: a few years ago a colleague of mine at another brokerage listed his uncle's home. (Always tricky dealing with family and friends...but that's another blog.) Anyway, shortly after listing, he received an almost full price offer on the home. He presented the offer to his uncle. Because it happened so fast, his uncle not only rejected the offer outright but withdrew the listing and asked his nephew the Realtor to re-list it at a considerably higher price. The uncle was convinced that his nephew had severely under priced his home to have fetched such a fast offer.

You are smart, so you know what happened. The home sat and sat on the market and eventually dipped in price by reason of reductions way lower than the original list price until it expired unsold.

While there is not a perfect science, a great Realtor will study comparable sales (not what is listed; you can ask any price you want -- we go by proven results) to suggest a price to you. A great Realtor will also showcase and launch your listing in style and for a brief period of time you enjoy the spotlight of being the new kid in town.

If a buyer has been watching and waiting for a home like yours to come on the market, they'll jump. Make no mistake -- if your home was overpriced, they would not jump! They proceeded with an offer because your Realtor did a great job.

A great Realtor will share with you how they arrived at their pricing, so you don't need to fear being under priced simply so that your Realtor can line their pockets.

And, for every quick sale there are many more sales that take much longer. Over time this balances out for Realtors. When asked the question, "are you going to cut your commission because it sold so fast?" the answer should always be "as long as I can raise it if your home takes a long time to sell!"

Good things do happen! So, if you're lucky enough to get an offer quickly just know that lady luck has conspired with a great Realtor! Take the money and move on with your dreams!

Are you loyal?

A recurring nightmare for Realtors goes something like this: for six months they've racked their brains, redone market evaluations to check pricing, advertised relentlessly on line, done open houses, taken tour though, used the local press in efforts to sell your home and still have not had an acceptable offer on your home. It happens, often without good reason. The listing expires and the owners decide to "take a little break." Meanwhile, Realtors combing "expireds" for listings initiate contact and promise the moon. "We take your listing to Alberta (so does every Realtor who uses the internet!), we advertise 24/7 until you're sold (so does every Realtor using mls), we only charge 3% (all commissions are negotiable down and UP at the time of sale -- bet they didn't tell you that), we sell more (they don't tell you they're comparing a team of 6 to one individual.) You catch my drift.

What wakes the Realtor in a screaming sweat from this nightmare is when their client falls for this drivel...not only falls for it, but signs with this competing Realtor, and not only signs with this competing Realtor, gives them the price reduction you've been asking for for the last 60 days!

What drives the final stake through the Realtor's heart is when the home sells (due to the price reduction) and the competing Realtor promptly displays a big fat sold sticker on their sign!

If you have a Realtor that's doing a great job for you, for pity sake, be loyal! They will get the job done and they deserve your loyalty. Don't let someone else prey on your insecurity or frustration. Simply let them know you have a great Realtor and you're taking a break and kindly not to call you again. But, do bring buyers!

Oh, that reminds me that's another hook, "I have a buyer who would like a home like yours." Oh, really....why didn't they bring them buy during the 1/2 year it was listed?! Ha!

Competition is always a good thing, don't get me wrong. If you've had a dud Realtor, by all means do not favour them with further business. There are many fantastic Realtors with high ethical standards you could be using.

But if you have one of those great Realtors already, one who is doing everything possible to bring you a successful outcome...don't break their hearts! Stay true and stay loyal.

What's it worth to you?

There is an urban legend involving Picasso I thought of today. As the story goes, Picasso was in a restaurant dining with a friend when a woman approached him. She apologized for the interruption but told him he was her favourite artist. She begged him to sign her dinner napkin and promised she'd pay him whatever he asked if he would just take a moment to do that. She repeated that she would pay him whatever he asked. Picasso signed the napkin and when the woman asked him what she owed him he told her $20,000. She gasped, "but it only took you 30 seconds to do that!" To which he replied, "No, it took me 20 years."

Sometimes people think Realtors get paid too much on a successful sale. After all, if you broke it down into hours it seems a disproportionate amount. What is underestimated is the amount of training, knowledge, experience and accuracy a great Realtor brings to the equation. What is also underestimated is the understanding that a Realtor generally does not get paid until and unless they're successful! Just because they work hard does not mean that they receive a dime until and unless they've done their job.

Are there lazy Realtors just in it for a quick sale? Of course. There are duds in any profession. But you will hear me say again and again, a great Realtor is worth their weight in gold. They will make you money, save you money, steer you in the right path to optimise one of THE MOST IMPORTANT investments you ever make. They will lose sleep finding you the most perfectly suited home for you and your family...and your critters. They will hold your hand, fill you in and advocate for your interests like a badger on steroids.

A great Realtor is not a one hit wonder; they're invested in you and your future. They are educated, experienced, superb negotiators, knowledgeable, know their area and most importantly know you! If you don't think in terms of having a Realtor in the same way you think of having an accountant or a doctor or a dentist, you certainly should!

Jumping from pillar to post with one hit wonders in the real estate profession is no different to your long term goals than if you had a different investment counsellor every time you made an investment decision. You stay loyal to the investment guide who knows you, knows your goals, knows your capacity for stress, knows your tolerance for risk, knows your family. As a great investment counsellor a great Realtor is with you in the good and bad market cycles advising on timing and strategy.

Given the amount of risk, stress, uncertainty, drama, learning and liability a great Realtor lives with every day it does not take them several hours or days to successfully market your home. It does not take them hours or days to successfully find you a home. It takes them years of experience gained long before you ever met.

What's it worth to you to have a great Realtor? It's priceless.

A Class Act!

In the past week I became aware that clients who had been working with one of the Realtors from my office had a shift in loyalty. This happens, usually due to a misunderstanding and no fault of the great realtor they started with.

To appreciate the story know that after a close chance to sell their home and purchase another one, the buyers intending to purchase the client's home (which would set the domino reaction) couldn't complete; so the home listing expired, unsold.

As it happened, the original buyers came back with an offer a few months later since they were able to now access the necessary funds. The clients were presented with this offer again and the chance to buy their dream home. Unfortunately they decided to shut out their original realtor and use one from another company that had helped them almost two decades ago.

The second realtor was completely within his rights to think "sucks to be you" in reference to our office realtor. After all, the home had been expired over 60 days and the original realtor had no claim on any proceeds even though she was the one that initially negotiated the deal on both the sale and purchase for these people.

The Class Act part of this story is that the successful second realtor not only contacted our office to update everyone of what the status was; he also referred the lion's share of the commission on the sale of the clients home to the original realtor. And, beyond that, he also referred a portion of the new home purchase to our office realtor. What a Class Act! Makes me proud of our profession.

By being so above board, generous and clear, this colleague earned immense respect and good will; not to mention the ongoing wish to do business with him.

In circumstances good and bad we always have the opportunity to be a Class Act. The impact of such actions is a living legacy. All too often short sighted greed rules the day. In this case, the fine realtor who was so generous doubtless asked himself the golden question: "if I was on the other end of this, how would I want it to be handled."

Some say what goes around comes around and I think that's true. By taking the long view, the kind and honourable action I believe we set in motion all manner of great future returns -- not to mention the immediate gift of feeling great and building friendships!

Really? You're going to cheap out with so much at stake?

Lord love a duck, where do I begin? OK, I'll start with a true story. Last year I was referred to an oral surgeon in Kelowna (stay with me, this ties back into real estate in a second). In my local dentist's opinion, he was the man to see. Before peeking at my pearly whites the Doctor's office manager explained to me that his fees were higher than what most insurance plans would reimburse patients and I could find someone to do surgery cheaper. Now, do you think I left the office? Of course not, it's my mouth and my smile, I want the best. And, to come with his recommendations I knew that in the long run there was far more VALUE in paying a bit more up front for something that would last and last.

(An aside for the ladies...you know how long a cheap pair of shoes lasts!)

If I could cement one thought in your head, one reminder it would be this. BE SMART ENOUGH TO CHOOSE VALUE OVER PRICE. In the end, when you do this, you always end up making more money and saving more money.

Somehow, at least in my area, people started thinking it was a good idea to make choices in Realtors by looking for the cheapest commission. Really? When any company can sell you something far cheaper than another it is always based on volume. If you're listing a home based on a company interested only in volume of sales do you think they might push on you to undervalue your home for a quick sale or pressure you to make a quick buy? Just asking. Do you think that there could be a mindset of "What do you expect from me now? You already paid peanuts for my service." (When I go to Superstore I sure don't expect help or someone to carry my groceries out! Ha! I go knowing I will receive little to no meaningful help.)

Beware too of the broad stroke statements. "Only 3%!" Well, what they don't say is that all commissions are negotiable and in the main if you see higher commissions they are just on the first 100,000 of sale price. In addition what most low commission companies don't tell you is that they are QUITE happy that most brokerages pay cooperating brokerages more than the lowest rate possible, because low commission folks love it when they quietly make a lot more money from sellers who buy homes using their services that are listed with other full service, quality brokerages. If you choose to work with a company advertising how low their rates are make sure and ask them to credit you the balance if you're then buying a home where the brokerage rewards cooperation more generously. But you didn't hear me say that...ahem....

It's a smokescreen, people! Beyond that, do you really want to "Walmart" your home sale? Do you think it might more than make up for the few thousand more it might cost you on the front end to have a great realtor that will price and negotiate for you to receive optimum value for your home? Time and again I see it play out that the best Realtors, the best after sales service Realtors, the best Realtors for negotiations always end up putting more money in the pocket of their sellers and saving more money for their buyers than one who fools you into thinking all Realtors are created equal and we're interchangable.

All Realtors are most certainly NOT created equal. You deserve a great one and you deserve the knowledge, patience, grace and VALUE of working with the best.

No doubt I'll light up this powder keg again from another angle in a future blog. For now, just remember, please to ALWAYS CHOOSE VALUE OVER PRICE, whether you're buying shoes, hiring a lawyer, getting plastic surgery or selling your home. The bigger the amount of money and risk the MORE you should adhere strictly to that rule!