When it comes to real estate, we know agents influence everything from the locations a buyer considers to the type, size, and style of home they purchase. But that's only the beginning. Not surprisingly, REALTORS®are also sought out for real estate-related services.
A survey from Campbell Communications and Inside Mortgage Finance Publications "revealed that real estate agents hold sway when it comes to choosing a lender," said The Truth About Mortgage. "In fact, the survey claims 45% of buyer decisions regarding which lender to go with are controlled or influenced by real estate agents."
Larry Vecchio, broker of VRI Homes and founder of Homesin.com, has found this to be true in his East Coast-based real estate practices. "It would make sense that a buyer would approach their trusted real estate agent for counsel on resources like mortgage lenders, inspectors, and insurance agents," he said.
A lively conversation on Zillow's advice thread tackled the question of whether a buyer should use the home inspector that was recommended by a client's real estate agent. While opinions were mixed, the common sense response was: If you trust your real estate agent, you should trust their recommendations.
A trusted expert
For many real estate professionals, the trust factor extends beyond industry-related factors, allowing agents to exert influence over a wide range of factors.
"We probably refer three to five things to every client - contractors, oil tanks, cable companies. Even local restaurants we recommend," said Vecchio.
Vecchio established Surf Your Town, with community websites in every town served by his companies that list preferred vendors and allow clients to find recommended businesses ranging from banks to bed & breakfasts and carpet cleaners to chiropractors close to home.
"People consider us a community expert, so they ask for recommendations all the time. The percentage who take our recommendations is probably 80% or higher. If they ask us for a referral, they're at least going to follow up. That's the trust level we've established within our communities."
Knowledge of the area
Today, building that trust is about service, but it's also about knowledge. Moving from one house to another, even if it's just next door, could trigger a need to seek out new utilities; people who are moving to another city or state, typically need more guidance in this area. Who better to turn to than their real estate agent, whose job it is - quite literally - to know the ins and outs of the area.
If you think this isn't an important factor for buyers, consider the story of "Seth." This work-from-home software engineer bought a house in Kitsap County, Washington after extensive research into the available Internet in his neighborhood, according to Ars TECHNICA. The story of how he was repeatedly foiled in his attempt to secure said Internet service is maddening, but the bottom line: Unable to get what he needed, Seth chose to sell his new home after just two months.
The upshot for agents is: It pays to be someone who's keyed in to what's available in their target neighborhoods and able to serve their clients as an area expert. Some agents have even had great success by promoting the high-speed services offered at a specific address for a tech-savvy clientele.
The science behind referrals
Referrals are nothing new. Pre-Internet, referrals were one of the main sources consumers had to find an agent, a doctor, a tailor, or a house painter. But the ability to do a Google search and find anything they need in a couple of clicks has not lowered the likelihood that people will follow the referral given to them by a friend, colleague, family member, or real estate agent.
A study on Media Post shows that "59% of people consult friends and family for purchasing decisions - and that, even given a recommendation, they are likely to do further research," said ConversionXL. Tech company Vendasta reports that "more than 88% of online shoppers incorporate reviews into their purchase decision."
What that means for agents is that clients will ask around when they're looking for you, and then they'll look to you for whatever else they need. The experience you provide matters, and your influence goes far beyond which neighborhood they should buy in.
Especially if it's a neighborhood that doesn't offer high-speed Internet.