Increasing Agency Profits Through Property Investment

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Traditional real estate brokerages face the daily challenge of searching for ways to maintain growth and profitability.

This often includes contracting with new agents, flooding the market with direct mail and sports schedules, and boosting advertising expenditures on television, radio and print publications. Many times with questionable results.

A better, more efficient means to ramp up growth includes adding property investment to the agency’s offerings.

This approach marries standard retail real estate practices with those of an investment brokerage. By utilizing this model an agency can interface with motivated home sellers and property investors. They can determine if there is a strong current market for the property and if the home can be sold quickly or listed through traditional methods. Often the agency can purchase the property itself at a reasonable price, understanding buyers will pay a premium for a home in that area. The end result is a substantial profit for the agency without incurring extravagant costs for marketing and other expenses.

The addition of the investment option creates a three-pronged approach to agency operations and what this writer has labeled The Trifecta Model.

The Trifecta Model trains and educates your agents to serve as consultants rather than aggressive over-the-top salespeople. It encourages them to meet with prospective home sellers in person and eliminate long and often wasted time spent with telephone surveys and negotiations.

Agents are encouraged to schedule appointments with prospective clients. They do an analysis and help the consumer or seller determine the right course of action to meet their needs. This can include helping them ascertain pricing and home staging, contracting the property with the agency as a traditional listing or simply offering them a reasonable purchase price to relieve them of the burden and time to sell the home.

This approach can double or even triple revenues. A solid example is Yates Estates, a fast-growing real estate agency in Atlanta. The firm has been using the Trifecta Model for over a year. The agency has grown from one superstar type agent to over 30 agents. The firm has participated in dozens of actual property purchases and sales. Overall the firm is on target for well over 250 transactions in the current year and continues to add not only to the team but also to the bottom line.

Adding to the success of Yates Estates is a strong internal marketing effort. This includes generating appointments for agents so they can spend more time face-to-face with clients. It also involves providing them with the proper type of signage and marketing materials to assist with the execution of the Trifecta strategy.

Education is, of course, a strong part of this process. This will require an investment and some time to learn this three-pronged strategy. Many veteran agents may be forced to eliminate old habits as they learn the rudiments of property valuation while newer agents welcome the opportunity to add this to their sales offerings as a way to differentiate themselves from the rest of the real estate pack.

As a typical agent struggles to meet the average of four to five deals per year, the addition of the property investment option can double or triple his or her production. Multiply this by five, ten, or fifty agents and an agency can easily double or triple profitability as it strongly differentiates itself from the competition.

Peter Vekselman has some 15+ years of experience in real estate and investing. A long-time business owner and entrepreneur he is one of the leading real estate investors in the Southeast and is the Owner/Principal of three companies. To learn more about the Trifecta Model, Peter can be contacted at peterv@pvretraining.com or 404-915-9685