By Bill Johnston
The real estate salesperson is the “general contractor” in the sale of property. He or she delivers some of the required services to the consumer directly (open houses, negotiation), and contracts out other key duties to the “sub-trades”. These sub-trades include: mortgage brokers, property inspectors, lawyers, movers, title insurers, stagers, photographers, sign installers, printers, deal processing staff, professional measurement firms, and others. The law, our codes of ethics and prudent professional practice dictate that we ensure our customers get the best service throughout our relationship with them.
The real estate professional’s success hinges on building long-term, mutually beneficial relationships with clients, colleagues and sub-trades. The MLS system, which is the cornerstone of our profession for residential practitioners, is designed to foster a high level of co-operation among members of the profession. That benefits both the professionals and their clients by making properties and property information easily accessible.
We have enjoyed our “general contractor” status for decades. People place us in that role by making us their first call when they want to buy or sell real estate. We are able to guide the transaction, and are paid a very good sum for our efforts. The sub-trades are paid a relative pittance for their contributions to the transaction.
Some members of our profession mistakenly assume that we have a permanent right to the general contractor role. Complacency sets in, service standards drop, and the door is opened to the “barbarians at the gates” of our profession who think they can do the job better than we can.
Microsoft, General Motors, Zillow, lawyers, title insurers, mortgage brokers and others are already making inroads in their efforts to convince the public that they can handle the whole real estate transaction cheaper and better than we can. When we cut corners, we simply make it easier for these alternatives to take our business from us. Our best defense is to look for ways to improve our service, and then implement those improvements consistently.
All of the tools required to preserve our role as general contractor in the real estate transaction are at our fingertips. We simply need to use them.
A few years ago, a group of us got together to play a game of slow-pitch softball with a local accounting firm. After the game, we limped off to the local bar for beer, chicken wings and socializing. The party was in full swing when I noticed one of our salespeople sitting alone at the end of the table. He looked uncomfortable and out of place. I asked my friend Bob; “What’s up with Greg?” Bob said; “Greg’s a great guy, but he has no ‘short-term personality’.” When I stopped laughing, I realized that Bob was right. Greg has a heart of gold, and has great professional skills, but he lacks the ability to socialize on a casual basis.
“Short-term personality” (STP) is what wows the other person in the bar. Call it charm, charisma, sex appeal or “bedroom eyes”, it is a useful quality in most social situations. Real estate professionals need some STP in order to get business relationships started. But it is long-term personality (LTP) that enables us to build win-win relationships that work.
LTP can also be called “character” or “integrity”. People with lots of LTP recognize that success (in terms of enjoying life) requires a win-win approach. Furthermore, every relationship that we enter into as real estate professionals is designed to be long-term. And the best long-term relationships are those in which both parties feel rewarded.
Let’s look at the various relationships that we establish during our professional careers:
Buyers and sellers – Our codes of ethics dictate that we always put the interests of our clients ahead of our own. When a buyer or seller agrees to work with us, it is an act of faith. Because the consumer is ignorant about real estate brokerage matters, he or she makes the decision to work with a professional. At that point, the consumer is vulnerable. If the professional chooses to prey upon the consumer’s ignorance, the professional can cut all sorts of corners and often can get away with it.
This applies to any professional relationship. For example, I go to the dentist because I am ignorant about dentistry and I choose to remain so. When I sit in the dentist’s chair and open my big mouth, it is an act of faith! I hope that, when he looks in, he won’t be thinking about the $8,000 he needs for the trip to Barbados. I hope that he applies his professional knowledge to determine what dental work I actually need. Could he tell me I need major repairs and get away with it? Probably he could, because I don’t have enough knowledge to protect myself from his selfish deception.
In real estate, consumers are vulnerable to the unscrupulous salesperson who chooses to prey upon their ignorance. We have a choice to make in terms of building our professional careers. Do we want to prey upon the consumer’s ignorance for our own short-term gain (win-lose), or do we want to put the consumer’s interests ahead of our own, thereby building long-term, win-win?
Next time in Part 2, we’ll look at relationships with others in the real estate industry.
Bill Johnston obtained his M.A. in psychology from the University of British Columbia in 1976, graduated from Osgoode Hall Law School in 1980, and was called to the Ontario Bar in 1982. He entered the real estate brokerage business in 1982. He has won many sales awards and has served several terms on the Board of Directors at the Toronto Real Estate Board. He is a broker at Royal LePage Your Community Realty in Thornhill, Ont. Email [email protected].
