Recently I was on a listing appointment and was the 2nd of two agents being interviewed. Toward the end of our meeting, I asked the sellers to compare and contrast the presentations.
One of the key differences was that the other agent spent considerable time touting the power and size of their company. I do not know the name of the other company. It very well could have been RE/MAX so this is not a knock on the company was being represented. Personally, I very rarely speak about the size of our company. It is my opinion that the size of a real estate company should not in any way be a decision factor when selecting an agent to help in the purchase or sale of a home. It just doesn’t matter. I cannot think of any home since the growth of the internet that my buyers have purchased because of anything a real estate company did. They certainly have been attracted to a home because of the marketing efforts of an individual agent but the company – not at all.
I am coming at this belief from a position of strength. There are only a handful of companies in our market that are known countrywide and probably none known worldwide like RE/MAX. The RE/MAX sales volume always represents a huge share of our market. But total sales volume in and of itself does not mean your home has a better chance of selling. It all boils down to the individual agent. There are great agents in large companies and great agents in one office companies. The reverse also holds true. In a large company or a small company you will find agents who are not the right match for you.
(It is hard to really know who is 1, 2 or 3 in a given market. Various charts calculate the volume differently. Each RE/MAX office is a franchise. Some reports treat each franchise as a company. If individual franchises are compared to a large regional company like Weichert or Long and Foster, none will really will stack up. But if taken as a whole, the RE/MAX numbers are certainly significant. The same issue would surface with Century 21 or Keller Williams as their structure is also based on the franchise model.)
BUT DON’T THE BIG COMPANIES ADVERTISE MORE?
Absolutely they do. But it has very little to do with getting your home sold. Most of the advertising is geared to make the consumer feel that the company has great agents that will develop a well, planned and stress free strategy to help you sell or buy a home. This has very little to do with getting a home sold. It has everything to do with getting you to pick up the phone and call the local office of that company or getting you to visit their website.
Yes, there are homes advertised in the newspaper. There are still full or half page ads placed by major companies to showcase some of their listings. But again, I believe that advertising is intended to show that a particular company is a major player in the marketplace. In today’s world, newspaper ads do not sell homes. It is the internet that is the main driver of traffic and how the home is presented on the internet is a decision the individual agent makes.
Let’s look at one of the key themes of RE/MAX advertising. Our ads often state that we have experienced agents. That is both true and important. Experience is a critical factor in selecting an agent but does that mean all RE/MAX agents are great? Well, they may be great but maybe not great for you. Your best match could be an agent from a one branch company or an agent from another large company.
(FYI, RE/MAX agents are typically more experienced because of the RE/MAX business model. With many traditional business models, agents have relatively low fixed costs and high variable costs that come into play only when they sell a property – mainly the commission split. The RE/MAX model flips that a bit. We have very high fixed costs regardless of volume – significant monthly broker and management fees – and lower variable costs. Thus unless one is productive or has deep pockets, it is hard to stay with RE/MAX for a long period of time. There are very few new agents who can start their careers with RE/MAX. I know a few who have and been quite successful but they are the exception to the rule.)
DOES SIZE EVER MATTER?
There are two areas where size may matter
The first is in the training arena. For newer agents, large companies often have sophisticated and comprehensive training programs run by folks whose only job function is training. Now, in contrast, a smaller company may not have a training department but very likely there will be a mentoring structure in place to help new agents get acclimated. Both systems have pluses and minuses. And, again, both systems have nothing to do with getting your home sold. Great agents can come from either system.
The 2nd is when a buyer or seller does not know any local Realtors. Let’s say a buyer is moving to Vienna from out of town and needs help finding a home. They don’t know who to call. Very likely they will start looking up agents with a name brand over their head. I am the same agent regardless of where I work but as part of the RE/MAX system, I may get that call. I find it very unlikely that I would get that call if I were Facenda Real Estate.
But, again, neither of these size advantages translate into getting your home sold.
IF THE COMPANY SIZE DOESN’T MATTER, HOW DO I PICK AN AGENT?
Well, that is a whole different blog. The short answer is that you need to be confident that the agent will work well with you and has a well planned strategy to get you where you want to go. I hope that person ends up being me but it may be another agent from a large well known brand or it could be a great agent from a small mom and pop shop. You will be tied to this person for several months and could be going through some stressful times with them. It is the relationship with the individual, not the company that matters.
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