What You're REALLY Paying a Real Estate Agent For

Are all real estate agents, idiots? Do you, do you have to be a putz to be a real estate? Now, Courtney, I know you may not believe this cause you're, you haven't been here as long as some of us, although you are a veteran team member. I've been here for quite some time. Um, those are both the names of things I've written. What is a putz? A putz? Well, we have to be careful here, but a putz is a derogatory term, but it's kind of like a good. I say a momo, a goober schmuck. Why are you being a momo schmuck is another in the, in the realm, but we should get it foolish. Yeah. Yiddish derived slang term primarily used to describe a foolish, inept, obnoxious person. That's why I said I have to be careful because it feels so good to be smart. I don't know much other Yiddish other than relatively mild, bad things to call people. You know, it's like most of my Italian that I learned from my uncles are all, uh, food or profanity. Mamma Mia. Mungia. Mungia Mori. All right. So what I'm saying though, is I once had a whole website called our all real estate agents, idiots.com. And I don't think there's anything up there anymore, but podcast listeners will now go and find out I'm sure. And Ian, we also had a recruiting website that said, do you have to be a putz to be a realtor? And the reason those things are real is because more often than not, sadly, the answer to both questions is yes. Most real estate agents just aren't that good at their jobs. They're not like the most brilliant expert, hardworking, well put together people. I do feel frustrated by like the side hustle of the whole thing. And that's the second part. So like the, just a way to make $10,000 every now and then so easy. Um, and it's not, but the point is that's kind of the public perception. So that's not the primary topic of today, but that lays the groundwork for the topic, which is what actually do most people expect a real estate agent to do for them? And then what do real estate agents actually do? So we're not going to answer a list of tasks that real estate agents do. What we're going to answer is what is, what is the value that a real estate agent can bring and how does that compare with how most people, and I don't mean like just, you know, the media and stereotypes. I mean, when people hire an agent, what are they expecting? What do they look forward to? What are they afraid of? What do they need? What do they don't want? That kind of stuff. So, um, we are a Dallas Fort Worth radio show podcast. Uh, and the reason for that is we live and work in Dallas, Fort Worth, and we help people buy and sell homes and remodel homes and live on land. And you know, provide shelter for their family and themselves in and around Dallas Fort Worth. So obviously we're going to speak relevant to this region, this area, the norms in DFW. So, so lean in if you are in DFW and you're thinking about making a move or you're considering selling a property by owner or buying a home on represented or going directly to a home builder or any of those things, this is going to be really relevant to you. And if certainly if you're outside of the area, I promise you, if you've bought and sold homes in a different part of the country, even in a different part of Texas, things are done differently in different areas, state by state. There's different laws and rules and contracts and agreements and city by city. There are different habits. There are different factors engaged in the process. And so I think you should pay attention. Uh, this can and will be very helpful for you if you are in any of those situations. And if you're just kind of curious about how real estate goes, this will be interesting to you too, because I promise you it often, almost never ever looks like it does on HG. I've been involved with a couple of HGTV shows and I promise you they don't reflect reality all that well. So quick ideals. Okay. What do you mean by that? Well that it's a 30 minute edit and so a big long process. You only get to look at three. You have to pick your favorite. And there's always the high priced one, the lower priced one and the one they give them constraints for. Yes. And then everything's going well until big climax. You have to make a big AB decision. So anyway, uh, also real estate agents don't spend most of our time at cocktail parties doing deals. Deals. How do you know Ryan Serhant a little, uh, from like millionaire real estate agent, New York and all that. And he's the closest to that, that I've ever seen like that. There is a little bit of the wining and dining and deal making and cocktail parties at that price point in that city. But even there, it's not the dominant. Wait, what do you think about him starting a brokerage here? He's done a pretty darn good job with Serhant. Yeah. I don't think as a brokerage they have like just this wildly unique selling proposition, but they are, they do things at a high level. I have to compliment that pretty impressive. And he's, he absolutely understands messaging at a level that almost nobody else in our business does. I do think them bringing their model to a market like Texas is going to be a bit of a shock to them and things again, like I just said, don't quite work the same, but they're not unwise. They're smart people. So, all right, let's get into it. What do people expect form an agent when they hire an agent? Um, there's a long list of things that we could say, but I want to start with Courtney as the non-licensed representative of the people in studio. What do you think most people, when they want an agent, what do they actually want? Why are they hiring? I mean, I think that they just maybe want a contract reader and my experience just boots on the ground. It sort of feels like we do every I'm doing the searching. I'm trying, I'm looking for what I want. And, and you're just my, you're my key. What is that? My, my door opener. Yeah. So the door opener is probably one of the more popular things. It's like, Hey, I can't get into that house without, without you. I can't get all of the information without, right. And some of that is true, but man, oh man, oh man, oh man, oh man. Should that not, I repeat, should not be the most valuable thing you get from a real estate agent. Okay. So let's just deal with that one. Both sides of that one real quick, right? Agents get me access to houses. Now that's true. There should be some filter of who can and can't open people's doors and walk into their houses, right? There should be a licensing process. There should be some liability and some, you know, some process for making sure that's done correctly and legally and all that stuff. So I think there's wisdom in having to have a professional with some certification and clarification and documentation for who goes in the house. But gosh, in the world of technology, companies like open door have found a way. Although I think it's very much on the fringe of the rules where you can just go get in a house all by yourself. Now, I don't think that's wise, but my point is if that's the most valuable thing a real estate agent does, real estate agents are in very big trouble. And so are the clients because that's not all that valuable to open door. You know, we get in cars with strangers of Uber and stuff now. So at some point that's not going to be something you need a real estate agent for anymore. And that doesn't scare me at all because there are much, much, much, much more valuable and critical things real estate agents do. But that is one of the big expectations. It's pretty amazing when you think about all the things that used to be valuable or used to be cool. And then just in our lifetime, they've not, I was listening to a podcast the other day and they were reflecting a little bit on this. And one of the things they mentioned that I thought was really interesting was if you got a knock on the door back years and years and years ago, you were like excited. Like, Oh, who is it? Who's it going to be? And now when you hear a knock on the door, that's a commentary on our culture and deeper ways. But you know, you, I think I've said it on the show. We have one, we have another podcast for real estate agents to coach them. Um, but I think I've said it on this one many times over the years that, you know, that there's this mean, this picture that lives in my head at all times, which is like 30 years ago, you'd have a stack of junk mail from your mailbox. And people were staring at their computer screen and like, you've got mail. Like, Whoa, cool. I got an email. And now it's like I have 47,000 unread emails. But if I get a real letter in the mail, it's like, Oh, very cool. I wonder who this is from. It's the same concept of like, Oh, someone's at the door. They're like, Oh, someone's at the door used to get a phone call and it was really exciting. And so when he was calling you and now you get a phone call, it's like, Nope, not answering. Yeah. So, so all that is true in real estate is evolving in very similar ways. And the point is if opening doors is what you wanted most out of your agent, that's not the most valuable thing an agent is going to do for you. If you're an agent and you are priding yourself that I can get you in the doors, you're a dime a dozen. So can everybody else. You got to do something more valuable. Okay. I would say you actually get a penny every penny per million. Yeah. And guess what? They're no longer making pennies anymore, but they are sure making real estate agents still. Okay. So one of those ideas that you mentioned, Courtney is the real estate agent should find the house. You know, I've been doing this for 20 plus years and over the years, very rarely, but you know, people will get upset with us or one of the agents on our team on occasion. And one of them, and certainly with a traditional agent is like, well, I found this house myself on the internet. So what did you even do? It's like, well, we're very clear upfront with our clients that finding the home initially is not one of the more valuable things we do. We can certainly help you get access to homes that other people don't have access to, but I know that you can go on realtor.com or any of these other big websites, and you can see a lot, not all, but a lot of what we can see. So we're just going to tell you upfront, we can help you with that, but that's not one of the most valuable things that we do. There's a very high likelihood that you are going to initially find the homes that you want to see as fast, if not faster than me. Sometimes. I'm not staying up till 3am after work when we get excited about it. And so, you know, that that's not even my job. I'm not, I'm telling you upfront, that's not the thing that I do. That's uniquely valuable. Now I am going to help you sort and filter by more accurate data and understand, Ooh, I know that looks exciting, but remember we talked about this and that property doesn't include that. And so let's be a little bit cautious here. I know that looks great, but that's not the school district we talked about, even though it looks like it's in that area. Here's the dividing line. There's a lot of that where an agent is definitely still helping you quote, find the house. But obviously with all these big giant massive website portals that will email you and update you and text you and button, you know, buzz your phone when new homes come online, that's also not something that is the most valuable thing a real estate agent can offer. But people do expect that an agent should be capable at that, but hope, man, I hope your agent has a lot more to offer you than that. So finding the house, uh, is one of these things. Getting you into a house is one of these things. Now, Ian, you know that we train our agents and we talk to agents all the time about negotiation. So what do you see or what do you hear from our agents or our coaching clients? When, what, what does a client want in this category from us or from their age? Like what are they, when we initially speak to them or when they truly understand either one, what are your observations around negotiations? So I think when initially when people talk to us, their idea of negotiation is give me the best price. Yep. Yep. And then over time they understand there's more to it and yeah, there's like layers of negotiation that happen all throughout. Yeah. I think basically, I mean, every piece of a contract is negotiable. I think people come to it. Like you said, I just want the best deal. I think they go farther and they would define a good negotiator as like this win at all costs, ruthless. We win, they lose bulldog. And that's kind of what they expect. We then often educate or encourage people to view it a little bit differently. Actually we train this the way we define negotiation is anything that I do as your lead agent or our entire team does that would affect any piece of this transaction in any way at any time. And that is obviously a much broader definition of how we answer the phone, how we deliver information, how we say yes and how we say no. All of this is negotiation. So the Ian's point, everything in the contract, every line, every dot, every letter, all of it's negotiable, but it's also everything we do that increases or decreases your leverage or increases or decreases how much they like you or like us or are willing to deal with us. It's not even always with the other agent or the other client. It might be with an inspector or an appraiser or the title company or a lender or whatever the case is on speed. It's not just money, leverage, liability, time, all, all of these different things. And I think the three, three of the key things that we point out to our clients is if anything that affects your time, your energy, your stress, money, I mean, that was four things, well it's time stress or money and energy is kind of in that stress deal of like how much are you having to put into this versus we're able to do it for you. But the point is people do expect people to get agents to negotiate for them. The irony here is in the state of Texas, and this is true in every state that I'm aware of, there's actually zero negotiation training required to get a real estate license, including a broker's license. So believe it or not, nobody is training the vast majority of real estate agents to negotiate at all. You don't have to take a single class, read a single book or piece of paper about negotiation to get a real estate sales or brokerage license in the state of Texas. It's so strange. I promise you there are people running brokerages full of agents that have never taken any sort of formal or quality training on negotiating. I think that's what scares me the most. Yeah. But that's the expectation. That's why NAR does research every year. The national association of realtors does research every year, at least every other year on consumer behavior and what consumers want. And they survey why do you hire agents and negotiation every year? I've been doing this well over 20 years. It's negotiation comes back as number one or number two access to properties is the other one that is one or two almost every single year. This show is brought to you by the Todd Tremonti home selling team, where we guarantee to sell your home over the average price and under the average time. We also guarantee to help you buy a home and save at least $5,000 throughout the purchase process. Check out over 800 five-star reviews on Google. We'll get back to the show. But people don't know that they're hiring agents to do something that agents are not even required to be educated, trained, mentored, guided, held accountable to in any way whatsoever, period. End of story. It's just not part of it. Now here at the Todd Tremonti home selling team, that's a big deal. We train on it. We read all the books I obsess over it. Over the years, I bought all the Harvard negotiation courses and read everything by Herb Cohen and gone through all the FBI, Chris Voss negotiation. And then we talk about it basically in every single team meeting. We don't even always say today's negotiation training, but we say, how are we communicating that? How are we delivering that? What is the impact on our client? Is there a better way to do that? How are we using that clause? Why are we using that addenda? All those kinds of things. So one of the other things that people expect from an agent is negotiation, but people are just ignorant. I don't mean stupid. I mean, without information, they're just ignorant of the reality that most agents are not at all trained in negotiation. There's actually one pretty decent certification that agents can go opt for and get all the certified negotiation expert. And it's decent. It's definitely not world-class, but it's something. And most agents actually have nothing. You know, another thing that I think people expect in around negotiation is just like this very short term, you know, get the contract the way I want it. And we're always telling them, I know that's what you want, but that's actually not the best. We need to have some leverage for long-term also. We might get to the night before closing and you may be called away to an emergency work or family health situation in another part of the state. And if we needed to ask for a day of delay so that you can handle something more critical or some crazy surprise, and we have gouged them for everything we could get out of them in the contract phase three or four weeks ago. And they're like, no, we're not giving you another day. You can pay a penalty or forget you. You don't get the house anymore or vice versa. You know we're not selling you our house anymore. We can opt out now. That stuff is real. And what people want this bulldog short-term negotiator thing is not always best. Now, sometimes you have to do that. Sometimes you need an agent who's capable of that, but more often than not, like 98 out of a hundred times, you need someone that can win now, but maintain a relationship with some longterm leverage remaining. So that's a lot on negotiation, but it's a big deal. Um, there's another thing Ian that I'll bump to you cause you're always having to work with our agents on this is that people sort of expect from an agent that if things are fast, then that means they were easy, right? So what's your commentary on the expectation from the consumer sometimes that fast is easy and I want fast versus the reality. Yeah. So, I mean, I can think back and think of times when we've sold a property, for example, and we've sold it super quickly. And I'll never forget this happened with somebody that I knew and we got an all time price for them. And it was like in the first weekend and it was an incredible like deal that we wasn't like it just sold fast cause it was too low. It was like fast and record. And the response was like, well, we should have done more than right. And it's like, should have asked me. No, like we shouldn't. Like we did everything we promised we were going to do and delivered it. And that is people's thought though is like, well, then you did it for less. Like you should have sold it for more. You should have asked more for it. So one of two things happens. What Ian just said, which is like, well, if it's sold that fast, we priced it too low, which by the way, probably statistically market wide is true more often than not. Like, Oh, well, we didn't ask enough cause it went really quick with quality strategy. That is often not the case. No, we hit the bullseye. And if we had priced longer, it would have taken longer or whatever. The second version is, and this doesn't happen as often, but sometimes people will say, well, it's sold in two days. Do I still have to pay a full commission? This was like really easy. Obviously. Oh, dang. Hold on a second. Right. Your pipe dream, your greatest goal was max money and fast. We don't get paid for time. We get paid for results, which is what you want. And by the way, if it had taken forever, you would have said the opposite, right? I don't want to pay. Do I still have to pay your commission? It took so long. And if I was using the same logic, I'd be like, no, you wanted to pay me for time and I'm terrible. And it took me two years. You should pay me a fortune, but we don't get paid for our time. And that's good for both of us. Because if we're really, really good, then we can make better money faster. But only when the client makes a great return on their investment and gets their, gets what they want out of the situation. And we had the same thing you mentioned earlier. Like, well, I found the house by myself. Like, why should, why should you get paid for that? It's like, it's the same thing on like the other side. Yeah. And this doesn't happen as much with us because we're setting the expectation up front. Like that's actually not a big part of what we get paid for, but what we hear from other people, like on different teams on just around the country is that it's very common and it's often exactly that. Okay. So there's another one that we laugh at on our team. Courtney is when we're in a neighborhood and we see a yard sign for sale sign that is not one of ours. And it has this sign writer, one of the top or bottom small signs that says neighborhood specialist. So you can say anything about yourself, but doesn't that sound good? Like if you were in that, right. So, so I think people expect sort of that he or she is like the mayor of the neighborhood. They know everyone and they know all the school stuff and they know all the street stuff and they know all the remodelers and they know all the rumors and they know where the parades and the parks and, and by the way, all that stuff is good. But the expectation that that is one of the most important things is a miss. I personally would rather have an agent that's never even been in my neighborhood. Who's a world-class marketer and negotiator and has great technology and great tools and systems and can attract a ton of buyers. I'm not saying that's perfect. I'm saying I would rather have someone who's world-class at selling homes quickly for more money with a smooth process, with low stress and demand on me and does things well and ethically and all those good things. But I'd rather have them never have been in my neighborhood with all that than be everybody's favorite neighborhood realtor and not be an expert and world class at marketing and negotiating and planning and have help and have technology and all those things. Now before things like the internet, that was probably a little bit more valuable. It was more valuable. It still wasn't as critical because a great agent could still go do their research and their data and the principles of marketing and negotiation and process management were still there. But I still value a neighborhood specialist. It's just more often than not when we see the writer and then we communicate with the agent, they are only a neighborhood sort of rumor mill specialist. They're like, I've lived here for 32 years. Nobody knows this neighborhood better than me. And then it's like, well, why did you price it so terribly when we made an offer? Why was your counter offer on the wrong documentation? When we discussed what's best for both of our clients, why were you completely blind to the fact that you totally failed your clients by over disclosing this information? So we find that the neighborhood specialist, not all the time. If you're an agent and you're listening and this is annoying you, maybe I'm not talking about you. I'm talking about the kind of agent that is like the neighborhood friend and rumor mill person, but not an expert agent. And so oftentimes people expect that and what they can see looks right. But what they can't see the expertise behind it is lacking. And that ends up being really costly for them. A couple of other just quick ones. People sometimes people expect a big brokerage behind you with a big brand that I've known and seen and all over the country for 30 or 40 years. But people that have bought and sold a house a few times usually come to the conclusion that the big brand, the big brokerage, the big website being in offices all over really have little to no value for them as an individual buyer or seller in the market. Big brands does not equal success. Hello, Dallas Cowboys. No, wow. I will say, I will say that I know, I know good agents across the country at big brokerages and tiny brokerages and you know, personally owned groups and big, you know, office lists, virtual ones. It's just not that alone doesn't mean anything is what we're saying. Um, the other one is I think some people really do. And Courtney, we've openly disagreed about this. Some people think like I want an agent with their face out in the open. Like I want to see your face and know who you are. Um, and then there are people that would say, that's this. Does that make you nuts? It kind of makes me crazy. Yeah. Like the, the joke in our industry, cause it's often true is that that photo is from 28 years ago anyway. So if you met that person, you wouldn't even know it was the same person because they like, they have their 27 year old glamor shot. But don't you think it's like how we date now? I don't, I haven't dated him. I mean, I hate my wife, but we're celebrating 24, but 22 years. Congratulations. But my point is that you are dating the world. Yeah. And I think I know what you mean. I'm not positive. Now we're all about images and not words. We're dating the world. The first showing is online. There you go. Remember when we did an episode on online sales of houses? Yeah. My point is this. I don't have any problem with people being like, Oh, I got a face with your face out there. I can get, well, my face is out there. It's sure as heck is not on yard signs though. But I do think people sometimes expect that image marketing. And all we're saying is again, it does. That is not in and of itself bad, but there are a lot. And we would say the vast majority of agents are marketing themselves more than they are marketing the property or their services or their unique value. So you're like, Oh, I've seen her everywhere. I don't really know what she's good at. What is she an expert? She's in the neighborhood and her face is everywhere. She's really pretty. Or he's, he's got that quirky marketing thing and I see him, but I don't know what he can do for me. So that's where we would caution people. And certainly where we coach agents. Okay. Let me just say very quickly, we value things very differently at the Tata Tremonti home selling team. This is obviously a passion of mine. We have a 13 point buyer program for our buyer clients. It is not about glamor shots and just what people want out of agents as a stereotype. We're going to do the things that our clients want us to do. But sometimes if somebody wants us to do something and we're like, that's not what we view as valuable for you, then we don't work together. We just say, Hey, we're not a fit. That's okay. You know, it's like if you needed a law firm, there's one right one out there for you. There's thousands of them out there. So we're not just going to do what people want to get their business. We're going to say, this is where our expertise is. This is how we believe we can help you the most. We're going to first evaluate what you need and what you want. And if we're a fit, we're going to move forward together, but we have a 13 point buyer program. We have a seven step proprietary marketing system for the sell side. We have a six week all in blinders on bootcamp style training for our agents. And then we have ongoing forever, ever, ever years long training for them. So we're offering value in very unique ways and we're offering values from a perspective called what's in it for them. Like where's the real value for you as a buyer or for you as a seller. And this isn't a commercial for me. I'm just sharing the philosophy of what I think people ought to look for when you are hiring an agent to help you buy or help you. So I think specialization really matters when agents are saying, Oh, we can help you buy and sell and rent and commercial residential land. And you're going, Whoa, that actually sounds good. But if you stop for a second, you go, no, what are you in? What are you world class at? I want someone who's incredibly gifted and has a great track record and maybe even guarantees their results. That's not likely to be someone who's a generalist at all these things. So this episode is about what do people generally expect out of agents and where does agents value actually coming from? What should you maybe not be so focused on and what maybe should you focus more on? And we're saying expertise, unique value systems, process, proven track records, specialization, not necessarily who can open the door. Who's got the best photo out there? Who does everybody in the neighborhood know their name the most, right? You know, who's at the biggest brokerage? Um, who can do it all? We're actually saying, be very, very careful of the typical expectations. Dig a little bit deeper, ask some better questions. And maybe once in a while, just say to an agent, you know, what do you do that others don't? What do you do that you're uniquely good at? What do you do? How can you help uniquely help me in my unique situation? So hopefully this was helpful. I am Todd Tremonti. We do run the Todd Tremonti home selling team. And if we can help you buy, sell, invest, or just think about real estate differently, even if you're just planning way ahead, you can go to Todd Tremonti team.com and check us out. We'll be happy to set something up for you at whatever pace is ready for you. Maybe just a phone call, maybe a zoom, maybe a sit down in person in the office. Maybe we get you a little backstage pass to the MLS or show you those processes and those systems introduce you to one of our world-class agents. You could probably even give Courtney a high five if you're in the office. So I'm Todd Tremonti. That's the Yanni Don, the English wonder himself, still riding high from the world cup and triple C herself, the full price. Courtney also riding high. We're here for you. Todd Tremonti team.