It’s the “educated agent” that’s likely to succeed in a post-NAR commission landscape in the US, according to experts.
In March, the National Association of Realtors (NAR) reached a US$418 million settlement over agent commissions, agreeing to eliminate its rules on sales commissions – practices that plaintiffs claimed artificially inflated costs.
The decision has thrown the industry into turmoil, with speculation that it could mean an exodus of agents from the industry.
In a a video on what the top agents are focusing on in the wake of the NAR settlement, Berkshire Hathaway HomeServices Beach Properties of Florida Chief Executive Officer, Jimmy Burgess, and Keeping Current Matters CEO, David Childers, reveal the goalposts have shifted and agents who are prepared to evolve will be the ones who come out on top.
Leveraging education as a competitive edge
Education and transparency will be key components of an agent’s role in the short-term.
“I don’t know if there has ever been a better time in history to be the educated agent,” Mr Childers said.
In a time of change, agents must arm themselves with knowledge, and understand the intricacies of the recent developments, he said.
Consumers have been “blitzed” with information but their opinions are “malleable”, according to Mr Childers.
He said the key for agents would be to educate buyers and sellers on the reality of the situation, because many people believe the NAR decision means they “don’t need to pay agents any more”.
“How we explain this out in the market and how we position ourselves as the educators will be remembered,” Mr Childers said.
“Going forward it’s also about educating people in the market because over the last couple of years, agents haven’t had to bring that.”
A mindset of adaptability
In times of change, adaptability becomes more important than ever.
Mr Burgess said change can be “scary for people”, but now was the time to embrace education, equip yourself with the facts, and adapt communication strategies to meet the evolving needs of clients.
“Most agents know what is happening,” Mr Childers agreed.
“Good agents understand what is happening.
“But great agents can explain what is happening.”
Back yourself
Agents are still essential trusted advisors for home buyers and that’s not going to change.
Mr Childers said that people still need agents and are willing to pay for their services.
He said that there is more demand for homes than there are homes available across the US.
“People are willing to pay for advice in the largest financial transaction of their lives,” Mr Childers said.
In a recent survey, 76 per cent of people still said they wanted someone by their side representing their interest when buying a home.
While 91 per cent of people felt that it would be very stressful to buy a home without a broker on their side.
Mr Childers said this points to the fact that there is still a need there for buyers and it’s up to the agents to demonstrate to clients what their value is.
“Become the person buyers and sellers in your local market look to for clear, concise information that they have complete confidence in,” he said.
“By doing so right now you will create a separation from your competitors that will be difficult for them to ever make up.”
