If you're a buyer or a seller you may not have heard this one but for the average Realtor, we've been armed with this statement as an objection handler since the beginning of the profession.
SELLER: "We want to use XYZ Realty because they are cheaper."
AGENT: "I understand that and let me ask you ... If you had a choice between a two Doctors that would operate on you, would you choose the best Doctor or the cheapest? .... "
AGENT ... "Because selling your home is like financial surgery... "
For a long time now I've been fed up with this particular method of talking with a seller. Frankly, I could not say it, because we all know that what Doctors and Lawyers GO THROUGH to get to where they are, is nothing compared to the average licensing process of a Realtor. So for me, it was always a silly comparison that no educated person would buy into. After all, most agents can pick their licenses up at Walmart whereas Doctors and Lawyers actually have several hundreds of thousands of dollars tied up in education.
Then it dawned on me. Assuming that there was no health care system (socialized or privatized) and there was no "award" settlements -- Assuming that you would have to pay the bill in CASH. What would be the cost of a doctor's visit? In most instances, the cost would be anywhere from $150 for a regular visit to $50,000 for a small to medium sized operation. The cost for an attorney is a little easier. For their services you'd likely pay $150/hr to $450/hr for most lawyers. Obviously, if your using the "OJ" staff, you'll be paying a bit more.
Now let's compare that to the average home in Georgia. With the average price of a home being around $200,000, it already eclipses the highest cost. A $200,000 operation would most likely be some sort of open heart or brain surgery.
Now I hear the cynic in you saying, "But Realtor fees are not $200K and even if I pick the wrong Realtor I can still get a portion of that."
OK. Let's look at commissions. Assuming you hire the Jarvis Team and we decide to charge 7%, that would be $14,000 total commission. That's a little under 1000 hours of Attorney services and would cover most medical visits for the average adult for 20 or more years!
A mistake on hiring the right person can cost you 3 to 10% ! that's a "oops!" to the tune of $6,000 to $20,000 in just this example.
So I ask you, would you want to use the Best Realtor for the job or the cheapest?
Want to take it one step further? In the day and age where sellers may be walking the line and getting close to foreclosure, hiring the wrong agent could very well cost you your home!
In Atlanta, discount brokers on average sell for 3% to 5% less than a FULL TIME Realtor. It's worth noting that someone like Scott Daniels in Florida may very well buck this trend as he has a high-octane business. There are "discounters" that do so, because they can through their thoughtful business plan.
Russ - That's it. What seems like the cheapest is actually the most expensive.
Dennis - I see you're an analytical thinker or a cynic. As a Realtor, I'm sure you know what I mean, but yeah, if the best is cheaper, of course I'm going to use the best too. It's easy to prove discounters (in this market - Atlanta Real Estate) are not the best.
Gary - Everyone wants a deal. The key is showing them that you're the best deal in town AT THE CLOSING, not before.
I don't know about ATL or GA, but in NC at least we haven't gotten so easy as to traipse down to Wal-Mart for your RE license!
Another point I'll make - anecdotally... In NC, we get a monthly newsletter from the State Real Estate Commission. Consistently 70% or more of the actions are taken against single-agent or discount companies.
Bo - I'm sure you realize I was being sarcastic. The barrier to entry into Real Estate is so low in every state it does absolutely nothing for consumer confidence.
Great point on the actions.