A Commitment to the Client
For consumers in the market to buy or sell a home, the model has typically been a straight-forward process. Buyers and sellers contact a local agent to explore their options and sign an agreement. Whether they research and select a top local agent or contract a licensed relative, how they choose the agency that will assist them is of growing importance. In many respects, most traditional brokerages and their offerings are very similar. They all provide “million-dollar marketing”, an endless campaign of open houses, and a gratuitous handshake to affirm their corporate mission statement that says things like “helping you discover your dreams.” While this all sounds wonderful in theory, these dreams can become nightmares in the absence of proper counsel. In many respects, the Real Estate industry has gotten a pass. Home purchases have traditionally been a staple in the American consumer diet. Everyone needs a place to live. As a result, the manner in which the industry conducts business has been less than scrutinized, to say the least. The very definition of Agency has suffered in the quality of services it provides. Proceeding unchecked, agents continue to pursue volume business, within traditional industry guidelines that often leave clients behind as a result. As we enter ever-trying economic circumstances, it becomes increasingly urgent to examine the finer points of this process. This helps build a brand of guidance needed to truly Consult and Advise clients. What’s more, it employs a templated process to protect consumers from the potential downsides of any prospective deal. In order to provide effective solutions, the onus must be placed upon truly serving represented clients. A growing lack of industry awareness in this context has necessitated an Advisory Approach.
Savvy investors closely monitor the market and the investment vehicles they use to participate in these markets. In economic downturns, these investors pivot and swiftly contact their brokers to adjust and protect them from financial loss. This is precisely what makes them savvy. They have a working knowledge of the subject matter that allows them to make heady decisions and ask educated questions. Successful brokers that advise these investors operate under the understanding that their success, is directly linked to the success of their clients. They develop forward-thinking strategies to enhance their client's returns, or they are replaced. Financial markets are extremely liquid. Fortunes can be made or lost immediately as a result. These very same fortunes can be made overnight, but typically they are amassed over long periods of time and rooted within a fundamental methodology driven by purposeful data. This type of approach is commonly referred to as an Advisory stance. Applying it to the purchase and sale of Real Estate can empower consumers to become investors rather than just buyers. How does one become a savvy investor within a routine home purchase? By engaging an Advisory Approach to the process. This act consists of answering a focused battery of questions designed to help them do so. Upon answering these questions, they develop the education and the awareness to ask their own. In this process, they grow their ability to properly vet agents and qualify the ones that will have any client’s highest interests at the fore.
This becomes a comparison that illustrates the contrast between traditional brokerage versus an Advisory Approach to Real Estate. Both approaches represent a differing set of values. The focus of traditional brokerage places more weight upon quantity over quality. This model of business ‘bakes in’ the reality that a certain percentage of their deals will not close, signaling that they do not have all the facts needed to serve their clients on the highest level. Citing a disparity of resources needed to properly-assess market challenges, it becomes easier to recognize how the interests of many clients are often neglected by a lack of due diligence. This void of research is filled in the form of enhanced valuation techniques as part of a comprehensive analysis. Most agents simply do not have the necessary tools needed to provide clients with the highest level of transparency that rises to the magnitude of Advisory. The industry has become an environment of agents competing against each other rather than on their client’s behalf. This reality is further accelerated by the influences of professional coaching, a new fold in the industry that specializes in helping agent’s market TO the client rather than FOR the client. Coaching services are geared toward bolstering the agent’s annual income. Reading the fine print reveals that coaching’s core initiatives often run counter to the inherent needs of the clients they are tasked to serve. Herein lies the contrast between Traditional Brokerage versus an Advisory Approach. Traditional brokerage focuses on signing the most clients. Advisory focuses on helping the most clients. The distinction is clear. Advisory provides agents the intel and transparency to decipher if they are truly capable of providing solutions and carrying out a prospective client’s wishes. The true measure of an Advisor is defined by their ability to willfully decline business if they do not feel they can deliver the desired results. Engaging an Advisory Approach, clients are presented data-driven reasoning, made aware of all findings up front, and wiser for the experience.