The Rise of Commission Discounters and Salaried Agents
Commission Discounters are, quite unfortunately, on the rise.
Their abhorrent offers of steep percentage discounts and flat $1,888 fees are pretty visible online.
This is placing unnecessary pressure on ethical, hard working realtors, who often have to contend with a rising DIY Buying culture and increasing advertising costs. To begin with, agents in Singapore already have a lower commission percentage than that of many countries, plus, they have many expenses to incur, with property portals unilaterally raising their fees yearly and what not.
So this is adding fuel to the fire, because it's a zero-sum game. There are no winners here, because:
- Agents lose business to cheaper providers, but cheap is not always best.
- Customers lose out on better services and higher professional standards.
- Bad agents are trading a potentially lucrative business for a lowly monthly salary.
It looks bad.
And I wanted to do something concrete about it and share an effective counter attack with real estate agents.
One Simple Strategy
Just one strategy to defeat $1,888 agents and discount portals at their own zero-sum game using what no one is talking about.
And that has to do with GUARANTEES.
What's a guarantee?
Basically, it's a promise for specific RESULTS or removing RISKS.
It's kinda like buying a microphone that comes with a manufacturer warranty, which says
"Free replacement for defects within 1 year of purchase."
The promise is that the manufacturer will guarantee that your purchase is free of defects, and if there are any defects within a year of your purchase, they will replace it for free.
That removes 2 huge risks for you:
- The risk of defects because you know you will take good care of your purchases since you paid good money;
- The inconvenience of manually searching, arranging and paying for replacements and/or repairs.
Basically they're removing the risk that you got a bad deal.
Pretty simple right?
Why aren't we doing this in our own businesses? Why can't we agents promise concrete results and remove perceived risks for customers?
Why Real Estate Has No Warranties?
I think the short answer is that everybody keeps on doing what everybody has been already doing for the past 100 years in real estate.
It's a classic case of 'Monkey See, Monkey Do.'
But now that this disaster is upon us, we have to change.
We need to resolve this and defeat those discounters at their own game.
Not by lowering our commissions and beating them on price, but BEATING THEM ON VALUE.
Value should be communicated in a Guarantee that promises specific results and removes all risks.
You decide what results you are capable of achieving.
You decide what risks your customers perceive about you.
Then write out a guarantee!
I hope we will see better days when discounters have been defeated!
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Yasser Khan is a real estate coach, speaker, and trainer at YasserKhan.SG who teaches Realtors how to make more Money, have more Time and enjoy more Freedom without all the B.S.
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