Sunday, 29 March 2020

New Home Training Needs a Good Dose of Salt, Part 2

Written by Posted On Friday, 01 February 2019 05:30

You can lead a horse to water, but you can’t make him drink unless you first make him thirsty. Think salt.

Which brings us to why homebuilders have so much trouble drawing larger numbers of real estate agents to their watershed events, even when the builder agrees to pay huge commissions and do all the work. Could it be their lack of thirst to lean about new homes or show new homes inventory? Even in the face of the tightest saleale resale inventory in years. 

Realtors® understand what is going on in their markets. They know Realtors® who are making huge commissions working with new homes and new condominium communities.

But the vast majority of the 1.3 million members of the National Association of Realtors® have no taste for working with new construction.

Studies show that Realtors® don’t want to wait for their presale commissions, they resist not being able to negotiate the price, and (opinion) they would not know how to find the right new home for a new home prospect if they had one.

So what is the solution to these concerns and fears? Offer training that teaches construction? Offer tours of construction sites? Lunch and learns?

Unfortunately, a major study commissioned by Builder Homesite Inc said that 63% of the 3002 Realtors® interviewed felt that builder training was ineffective. It did not say why.

Excuse me for asking, but why should homebuilders be teaching Realtors®? Should not Realtors® be teaching Realtors®? And, uh, why would a Realtor® need to know construction to introduce a new home prospect to the builder? What Realtors® need is a clean car and a GPS if they don’t know how to get to sales centers.

But wait, what would Realtors® teach Realtors®, especially when there is no thirst to do such a thing?

“He who controls the inventory controls the market” was the baseline philosophy of the Multiple Listing System until 2012 when Realtor.com and BDX partnered to offer home builders something they wanted and needed for a long time- access to the MLS without having to list their new homes inventory. BDX provided the new homes inventory feed, and 28 MLS associations around the country now access the same feed.

At this point, something critical started to change the culture. Inventory access was available via the Internet to shoppers as well as Realtor® and buyers for both new homes and resales started contacting Realtors®.

A 2018 NAHB report showed that 38% of these shoppers (up from 35% in 2013) are undecided, meaning they will buy a new home or a resale. This forced the Realtor®, ready or not, to start serving the needs of new home shoppers in addition to resales, especially now that they have access to new Home inventory.

Homebuilders understood the ‘undecided’ market five years ago when the number reported was 35% and immediately targeted this market segment to convince resale shoppers to buy new homes.

Realtors® seem to understand the need for new homes training of some kind, but no one seems to be thirsty enough to take even a swig at meaningful new homes training. Those that do recommend learning construction and ‘stopping by some sales centers” it seems.

The “training” reality should be obvious.

The training needed is not about the builder

It is not about the builder’s homes

It is about the Realtor®.

Realtors® need a large bucket of myth-busting truth to help them overcome their wrong assumptions, negative thinking, and costly no-training approach to working with new home buyers, builders and onsite sales teams.

To understand the need is to understand why more Realtors® are not thirsty enough to attend builder events or get involved with new home shoppers.

Especially, when the builder is providing the one thing Realtors® need most: saleable inventory.

It’s a shame because from a practical standpoint, new homes are the easiest to sell and close. The builder provides the most saleable inventory on the market.  Many production builders offer a service that recommends which homes to show, sets the appointment at the onsite sales center, and registers the prospect on the phone. Only a small percentage of Realtors® heard about this service, which has been around about 15 years.

More than 50 percent of the 244 completing a New Home Co-broker Academy survey said they did not know that there is an important exception to the builder’s ever-present ‘first-time’ registration policy. Knowing how to resolve this one issue can be worth thousands in commission.

The deeper problem is the fact that the Realtor® community does not know for a fact what to train or how to train its agents. Nor is it a priority.

The solution: Provide an affordable online course with an exam that any agent in any state can take that quells their resistance to sell new homes and creates a thirst to serve new home shoppers at the same level they serve resale prospects.

Once agents understand the benefits of adding the one thing they need most, saleable inventory, to their resale  showings and how easy it is to do, they will become more willing participants in new home events.-and sales.

 Once they get a taste of a new home sale, with the builder writing the contract and providing transaction management, they will thirst for more, 

 

 

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David Fletcher, NHCB

Lifetime Achiever David Fletcher is Founder and CEO of New Home Co-Broker Academy LLC, home of the New Home Co-Broker (NHCB) designation. More than 4,000 real estate agents have completed the  Academy's course, How To Build A New Homes Niche, a three-hour online course based on research, case studies and David's  long career recruiting, training and supervising onsite teams, who sold more than $3 billion new homes and condominiums.

Along the way, he wrote Condominium Sales and Listings and has been the featured speaker for the National Association of Realtors and a present at the International Builders Show. He served as chair of the Sales and Marketing Council for the Florida Home Builders Association. 

He started in real estate as the project manager for Bay Island, of the first major condominium communities in Florida. During this time, he obtained his Florida real estate broker's license, served as chair of the Sales and Marketing Council for the Florida Homebuilders Association, earned his MIRM designation, and served as president of the Florida Condominium Developers Association. It was here that he leaned to work with local Realtors, 

After a successful three-year run, he brokered 27 lender workouts, 11 rental conversions, a TPC golf course, and more than 1000 condominium units in six different communities. 

He recruited, trained and supervised onsite sales teams for more than 70 communities, always insisting on co-broker cooperation in his listing agreements. 

He has been a contributor to Realty Times for 16 years and contributed to Inman News for 3 years. 

His education philosophy is based on these simple assumptions:

  • Builders need qualified buyers. Realtors need saleable inventory. 
    Today's home shoppers expect their Realtor to help them navigate the buying process whether it be for a resale or new construction. 

To lean how you or your office can benefit with our popular online new homes course, visit our website. 

newhomecobroker.com
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