Residential real estate brokers are often portrayed as slick, confident, fast-talking salespeople, always impeccably dressed, and well-coiffed (see: all the stars of Million Dollar Listing).
But brokers are people too — they make mistakes, some of which could be costly and jeopardize future business.
Broker’s Weekly spoke to agents to find out some of the most common mistakes brokers make, and tips on how to avoid making them.
One of the biggest themes that brokers discussed was not educating a client enough.
Louise Phillips Forbes, a broker with Halstead, has been in the industry for 25 years. She learned over time how important it was to stay on top of her game in terms of being knowledgeable.
“Because I represent developers, and buyers, and re-sellers, I am very data-driven, and to be honest, 25 years ago I was not data-driven,” said Forbes about her rookie days. “I was just grateful someone would give me their apartment.
“I find that when brokers walk through the door with a buyer, they often do not know the market themselves. They’re advising to win the trust of a client. What I do to elevate their knowledge, is that I share some of the data I’ve compiled for that seller about the building.”
That also includes interpreting data from comps correctly, in order to use it to their client’s advantage.
Forbes emphasized the importance of making sure a client looks further into the future when purchasing an apartment.
“I feel that a lot of time, individuals try to buy space for where they are today, instead of foreseeing what their future might provide them,” she said.
“I’m always trying to think of a long-term buy. At the end of the day, one can only spend so much a month when buying an apartment, but if I can help them find a place that might need a little work, but that gives them a maids room, or a possible third bedroom, instead of paying a lot more for something that has views, I can help them prioritize.”
And when buying an apartment in a small building, with less than 20 units, Forbes stressed the importance of having a professional inspection done before signing any paperwork.
“When you come from a position of educating, it disarms and gives someone a level of trust,” said Forbes. “I’m really interested in finding the right home at the right time and the right price for the buyers; 95 percent of our business is personal relationships. With the most important thing being the right home, the rest will happen in time.”
Kimberly Nicole McCampbell, a Realtor based in Houston with Berkshire Hathaway Home Services-Anderson Properties, said one the most common mistakes she sees are brokers slacking off.
“They get lazy, they assume that they know everything, and they don’t necessarily go over documents the way they should,” she said. That includes not staying up-to-date on current laws and guidelines.
“Some are lax when it comes to keeping up with education and what’s going on in their market,” said McCampbell.
And in a world that seems to revolve around social media, many older brokers aren’t keeping up with the times.
“Some of the older broker firms, and older brokers themselves, are not necessarily doing what they should to get on social media and the internet, and marketing and advertising,” she said, adding that keeping up-to-date information on social media profiles, including job positions, and working on marketing themselves rather than “riding the coattails” of a big company, will help their business significantly.
Jessica Escobar, with Citi Habitats, learned from her mistakes early on during her first couple years as an agent, and one of her biggest takeaways was staying organized and keeping a record of everything she did.
“I’ve done a really good job of creating a database,” she said. Escobar recently spent a morning writing personalized cards to all of her former clients. “I literally went through everyone I’ve ever rented to and wrote little cards to them to say hello. Most agents, what they do is very transactional — they kind of just move on to the next deal.”
Though the notes were time-consuming, Escobar said it was worth it because it’s part of building repeat business.
“We have a great opportunity to go back to business we’ve already created. Keeping in contact with past clients means you’re not constantly trying to look for new business,” she said.
In a field where pay is commission-based, a deal falling through can be a big blow to not only a broker’s bank account, but also their confidence. Take the time to blow off steam, re-focus, and don’t make the mistake of letting losses get you down for too long, said Escobar.
“At the beginning of the month, we’re in a unique position to start from the beginning and reflect on our business,” she said.
“The last four deals I was working on, they kind of died. But being able to get that latte, or go to the gym, whatever it is that makes you feel better — do that and get over it.”
With the current state of the market — lack of inventory and sky-high prices — Escobar makes sure that her clients are informed about how competitive the field is.
“Clients aren’t in a lot of room to negotiate,” she said. “So with buyers, when we go into ‘best and final’ – it’s just that. There’s no second ‘best and final.’ With the market the way it is, and interest rates remaining unchanged, as a buyer with a lack of inventory, you really don’t have a lot of leverage.”
Managing clients expectations, and giving them a clear picture of how tight the market is, can prevent heartbreak.
“Until they lose their first bidding war, they don’t get it and don’t understand,” she said.
“That’s what it takes sometimes with a first-time homebuyer. Have that conversation before you see anything, because they get emotionally attached.”