Recently on our consulting forum, we had a very interesting discussion about where our value today lies as agents. It seems that in the tough market that we are working in, many agents are competing for listings by charging less than the competition and requiring less commitment in the way of an exclusive agency contracts with buyers.

This is so sad because you can never compete on price and stay in business. No matter how low you go, there will always be some desperate soul who will charge less. And when you don't require a commitment from those you work with, you only underscore that your time, experience, and expertise has no value.

In my last book, I talked about the difference between a commodity, which can and should be shopped by price and a service where the quality, level of expertise, talent or experience makes a big difference in the outcome. When an agent or brokerage competes on price, they reinforce the perception by the public that agents are all the same, a commodity, and therefore they should be shopped by price. However, when a real estate professional understands and articulates their value, the consumer will beat a path to their door and the competition will be left in the dust.

Realtor® Wynne Achatz made a very astute comment about our value:

"WOW let's go back to 1996 - That is when my consulting really began full strength. I was bedridden for 3 months. Took 126 listings and negotiated 32 transactions. How? Clients wanted my help (consultation). They took their own pictures with my camera, measured their own homes, we looked at options, discussed what was needed to get the property ready for sale, action was taken, seller listed and put up their own signs ... never minced about the fees. What it all boils down to is that when you have something of value, folks will feel compelled to want it. The "I have to have it" syndrome.

Be confident in yourself. By the way: I am now charging $195 up front, non-refundable to take a listing or go under contract with a buyer. This is not considered part of a commission either. I have gotten more than a standard commission by listening to what the consumer wants and then getting paid for it! WE never had it so good."

If you don't know Wynne Achatz, let me tell you that she is one of the smartest professionals out there. Let me underline what Wynne said: when she was laid up, clients were obviously not paying her to run around doing functionary administrative type tasks ... THEY did them! Her value was that of a fiduciary: negotiating, interpreting and troubleshooting. She was sought after for her expertise, not her busy work.

Now, fast-forward to today: though technology has taken over more and more administrative level tasks while property search and valuation sites continue to pop up online almost daily, many agents are still in the circa 1975 mind warp wherein they believe that their value is in running around putting signs in yards and being the "gatekeeper" of information.

When the consumer asks why they can't do some tasks themselves, the vast majority of our industry is still getting upset. HOW DARE THEY! Many agents, deep down, are threatened when consumers take advantage of the information explosion brought to us via the Internet and get their initial property information online rather than coming directly to us. These agents and their brokers still don't get that their value does not lie in the old paradigm of who does the most administrative tasks that the consumer could do themselves aided by technology. They still don't get that the consumer, given their druthers, may choose to not receive (and have to pay for) some tasks that seem only valuable as proof that the agent in fact earns their commission.

However, if you truly can change your paradigm and embrace the fact that your value lies in your experience, expertise, and judgment, it won't threaten you that the consumer may want to hold their own open house or run their own paperwork around. I don't know about you, but I'd rather be negotiating contracts then throwing lock boxes on doors or waiting around for the fire department to show up and check the smoke detectors.

It should be no threat to us that the public now has access to real estate information, because the value is NOT in the information itself but in the interpretation of that information! If you are paid for your expertise, then you are no longer competing with the Internet to be THE source of data, rather you are paid to make sense of what all the reams of data actually means. In fact, the more data the public has access to, the more they need an information interpreter, not an information provider.

And please, let's dispel the notion that giving up some administrative tasks will somehow lessen our earnings. There is an old expression: "It's not the years in your life but the life in your years." Take the time you would spend doing jobs that are no longer needed to be done by you and devote it to other paying clients. And for those who say that clients will never pay a non-contingent fee for expert guidance, go back to Wynne's story. From 1996 no less!

When speaking with a new prospect about services and their value, I always make my "Nordstrom-Walmart speech": "In real estate, there is Nordstrom and there's Walmart. I only do Nordstrom. Now, as a trained consultant, I will give you a lot of choices in the types of services you can get and how you can pay for them. But, in terms of the quality of what I provide, I only do Nordstrom because Nordstrom is what's going to put the most money in your pocket when you walk away from the closing table. Now, if you are looking for Walmart, there's nothing wrong with that and you're in luck because there are tons of Walmart agents out there to choose from. But that's not what I do."

Know your value. Because when you peel back all the hype and really understand today's consumer, what they really want is real estate choice, not real estate cheap.

Published: September 17, 2008

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Mollie W. Wasserman is a pioneer in the development of Real Estate Consulting. She is the founder of the Accredited Consultant in Real Estate (ACRE®) Designation Course and Coaching Program, and author of the book Ripping the Roof Off Real Estate - How a Multi-Billion Dollar Industry Came to Have an Identity Crisis. Mollie is a real estate broker, ABR, e-PRO 500 (Select 50), iSucceed Mentor as well as one of only 200 CyberstarsTM. For more information about the ACRE® program, visit TheConsultingTimes.com, the premier journal of Real Estate Consulting or see the latest videos on Real Estate Consulting at ACREonYouTube.com.