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Posts from the ‘AgentThink’ Category

25
Jul

Getting Your First Deal and Avoiding The Sophomore Slump

Sophmore slumpSo, just how long does it take to get your first deal? It’s a question nearly every new agent asks me during the first interview. I say that they should prepare for at least six months without any income, but the reality is that everyone is different. Some come into the business with clients ready to go. Others start their career buy buying or selling their own home. Others have a massive sphere of influence and will turn a deal in a few weeks and others don’t know a soul in the city and take a few months to get ink to paper. Frankly there is no exact science to it, so I asked the question in a local Facebook group and got answers that ranged from a few weeks to half a year. Here is a cross-section of answers from agents in different markets.

One agent said… I managed to firm up my first deal in about 6 weeks. got paid in about 10 weeks. I would tell a new agent that they may lose money the first year. You can never predict how the market will behave.

Or, this one…I tell every new agent to have 6 months worth of wages (for personal and business expenses) comfortably in the bank. Don’t count on a pay cheque for 6 months min. I had mine in 5, but was prepared for 6. Too many drown in the overhead without a plan.

Another great comment… It took me 3 months and the second one didn’t come until the 9 month mark. I would say 9 months generally to a new agent.

Also this one…Started out on my own September, first commission December. I was prepared also for six months but very happy to say it took four.

And finally some wise words… it all comes down to how much the Brokerage can help them in the beginning and if the person will work it is a job. So much learning to do in the first year or so… so the stronger the brokerage I believe the faster the deals. Just like the stronger the team… more experience for the new agents, greater confidence and more deals.

Actually, I believe that it isn’t the first year that determines your success in any business but what you do in the years that follow. Many agents coming into the business with prospects or clients ready to buy or sell. They spend there first few months buying or selling homes for friends and family that they forget the basics of building a business for life. We have seen it several times, new agents who rock their first year, they go out and buy a new car, go for a holiday and think that they have walked into the easiest job ever. Then the reality of year two sinks in and they have no business in their pipeline. It’s called the “sophomore slump”.

So, how can you avoid the “sophomore slump”? Don’t take your initial experiences as gospel. Use your first commission cheque wisely. Use every opportunity to research your farm area, work on your website, get your continuing education credits out-of-the-way, and above all, prospect. These are just some of the basic building blocks for constructing a successful career.

Of course there is more to think about than surviving for as many as 6 months without an income. Have you heard the old expression…you need to spend money to make money? Starting any new business, whether it is a flower shop or real estate, requires some capital outlay. The good news is that, depending on where you work, the initial few months can be floated by the brokerage. Still, there are business cards, open house signs, name riders, website, not to mention a clean car, rent, food, gas. The list goes on and the amount needed will differ substantially depending on where you live and work. As crazy as it sounds, it’s important to have your finances in order right from the start.

mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.

23
Jul

Looking For The Secret Ingredient During The RE Interview

dopeI have been interviewing new agents for many years now. I enjoy the process immensely. This might sound like a crazy notion, but I like looking for that key trait…that one thing that will pinpoint who is going to be successful and who isn’t. It isn’t black and white or an exact science either. Sometimes they throw you a curve ball. I have hired meek, mild-mannered types only to watch then turn into very successful agents and I have hired corporate types, used to working eighty hour work weeks, only to watch them fail miserably.

Last year I talked to a broker who performed psychological testing on everyone who applied for a job at his office. Depending on the results some would become buyer agents, others would work as seller agents and still others might end up as licensed assistants destined for a life of clerical work. Asking new recruits to sit in a room for an hour ticking off boxes of a questionnaire doesn’t seem like a lot of fun so I ask a lot of questions instead. Not just about work, but about hobbies, and successes outside of the work environment. I’m searching for the special chemical. That ingredient inside people that makes them want to be successful.

So far here is what I have learned. Good real estate agents are entrepreneurs at heart. They instinctively know what the end product looks like ( in the case of real estate it is nothing more than creating a system that will continually reward them with buyers and sellers) and then building a plan to get there. They have the ability to think on their feet, adapt or fine tune their strategy as the environment changes, and never lose sight of the prize. Every morning they wake up with set tasks and don’t rest until every chore is scratched off their list. They look for different ways to do work faster and better yet they quickly dismiss ideas that have no merit. Like entrepreneurs, creative types share similar traits. Whether they are craftsmen, chefs, set decorators, artists or designers, they start off with a vision and know what steps they need to create the finished product. Of course somewhere along the way both creative types and entrepreneurs know that learning the ins and outs of real estate is an important key to their success.

So the question remains, can success be learned or are we born with it? In doing the research for the this post I came across an article in psychology today about perseverance. According to the author, it’s what separates the winners from the losers in both sports and life. What makes us persevere and achieve our goals? It turns out that it boils down to science and something called Dopamine aka the “reward molecule”. Interestingly, scientists agree that we all have the power to increase our levels of Dopamine by forming good habits and having a positive attitude. Could it be as simple as that? Could the key to success be a positive attitude? Well maybe partially. Like in business, runners experience that same reward. If you ask a runner why they run their answer is usually something like “it makes me feel good”. Maybe all an agent needs to be a rock star is to experience the first taste of success.

At our company, we provide additional training for new agents that, amongst other goals, is designed to teach them the basics of day-to-day planning, time management and the art of prospecting. When we studied the agents that went through Bosley U over a three year period we found that nearly 80% had achieved significant success. In our minds that was proof that teaching the techniques of good business was a missing ingredient in standard licencing. A clear goal, a vision of the future, an understanding on what needs to happen to get there, and a strong knowledge of the real estate fundamentals are the building blocks of success. So it seems that the old saying “success breeds success” may have some value. Perhaps that explains why one person sell 40 homes a year and another sell 4.

mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.

4
Jul

Don’t Do The Crime If You Can’t Do The Time

crime blogLet me start by saying unequivocally that I try to follow the rules. I tell my agents…work hard, make money, do the right thing, stay out of trouble and when in doubt, ask. These ideas have served me well. I suppose that’s why I get incredibly frustrated when others can’t do the same. I mean, is it too much to ask that we all compete with each other on an equal playing field? The reality is that there are plenty of opportunities to create an advantage in your business either through advanced technology, perhaps some service advantage or maybe it’s price cutting, and I should add here that I have no problem with any model that tries something different as long as it follows the laws that have been put in place.

But here’s the problem….lots of agents and companies are content to live outside the law because they know they either won’t get caught, they just don’t care or know that no one is going to turn them in. REBBA 2002 created the rules and regulations for which we must all adhere to and they are supposed to be administered by The Real Estate Council of Ontario. For the most part, the rules are not open for interpretation. They are black and white, not varying shades of grey. For instance the advertising guidelines are pretty clear. Display your true and legal name, your designation, contact information and above all clearly identify the company you work for (not place it in a footnote somewhere on another page). If you have taken your RECO update then you are aware that advertising guidelines form a major section of the course. So why is it that, on a daily basis, I come across advertising, whether it be in a website, on a sign, a flyer or business card that doesn’t comply? Simple. Agents know they can get away with it. They know Someone is not going to turn them in for not clearly identifying who they work for. It’s petty and a waste of time and the offender, if found guilty is likely to get a minor slap on the wrist or a $100 fine. Big deal. Call it the cost of doing business and quiet frankly does anyone out there have time to launch a complaint for a minor infraction? No. It’s hardly worth the time and to be quite honest, in my personal experience, many of my friends are breaking small laws like that here and there.

The truth is, I know some people who are breaking some pretty big rules too. Small companies that operate unregistered branch offices, agents that pay bird dog fees or knowingly disclose pertinent facts about competing offers. Frankly the list could go on and on and RECO is as much to blame because they won’t do anything unless you make a formal complaint. That means putting yourself out there, something that prevents most complaints from happening. So when an agent shows me a marketing idea that clearly breaks advertising guidelines I tell them that we don’t win THAT way. Their response? Well, so and so is doing it.

So what’s the answer? Well RECO could do nothing and people will continue to push the limits and before long we are working in the wild west OR RECO could adapt a DIS type service similar to that of the Toronto Real Estate Board. TREB’s DIS (Data Integrity Service) is an anonymous tip hotline for agents to complain about MLS listings. A similar system would keep RECO inspectors busy and initially we would see a huge spike in complaints and levied fines and like all hotlines there is always the possibility for abuse, but the goal here is to create a level playing field and nothing less. Complaints need to be backed up with proof and solid evidence. Minor or first infractions could be corrected with something a simple as a warning and a subsequent follow-up.. From there…sky’s the limit. It’s not a perfect solution and it’s probably filled with holes but the end result is clear. It’s time for our industry to get back to the business of buying and selling homes not looking for loopholes in a system that rewards rule breakers.

mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.

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