Should Real Estate Associations Make Basic Sales Training Mandatory?

Written by Posted On Tuesday, 29 March 2005 16:00

In the more than 25 years I've been a real estate broker, I have never seen a more difficult time for a newly licensed agent to make a living selling real estate. Listings are harder to get, buyers are entering bidding wars, and new home buyers are waiting sometimes more than a year to move into a new home. Competition is fierce, and commissions are being cut without a whimper.

Is it time for local Realtor associations to standardize basic sales training? To require the completion of a sales training course, before agents are allowed to become members?

Why should Realtor associations be responsible for training? It is the local association that has the numbers, staff, and marketing clout to set the sales training agenda and get it done.

For the record, I conduct seminars for newly licensed agents before they place their license. I have talked face to face with more than 100 newly licensed agents over the last year, and I ran a poll on my website for weeks to find out what new agents are expecting and what they are concerned about.

25 percent of the 157 agents who completed the poll expect to earn more than $60,000 in commissions their first year. About 34 percent think "learning to explain financing" will be the hardest part of sales training. Of course, this isn't true either.

My findings are not new.

New agents coming into real estate don't have a clue what they are getting into. They have no idea of the importance of a business plan, prospecting, or what their costs are going to be.

The National Association of Realtors reports that about 85 percent of those coming into real estate have no sales background.

My guess is that the other 15 percent for the most part, have some retail experience but that doesn't mean they know how to sell either.

This means three things:

  1. Agents have not a clue about how to prospect (and we all know developing a database and a farm takes them too long to get to their first closing).

  2. They need to know how to build trust, determine needs, and make a professional listing or sales presentation.

  3. They do not know what the value of their service is, so they cannot defend their commissions, even if they were trained to do so, which they aren't.

It's pathetic, and it is not fair to the agent. When are we as an industry going to face this problem?

Maybe we don't know how to face it, it could be too unpleasant and political to face. Perhaps we don't want to know the attrition or retention rates, because down deep we know it is ugly.

We have become an industry of vendor-driven trainers.

Vendors will have us believe that every agent to be successful, needs whatever it is they sell -- a laptop, software, PDA, website, contact systems, Internet marketing and all the rest. Maybe so, but not yet.

Associations push education, which they should, but until the agent learns to prospect, he or she has about all the education they need for the moment.

What new agents need to do first, is focus on getting prospects today, and not focus on another thing until they do. This needs to be important to their association, their broker, the sales manager, and their trainer.

As a group, we don't know how to sell. The general public doesn't look at us as professional sales consultants, most think we make way too much money for the services we provide; and we're not good enough sales people to defend our fees.

Maybe it's time for association leadership to take a zero-based approach to training and start with the reality that commission selling is a very hard way to make a living. In most professional commission-based companies, you don't start selling until you can make a professional presentation, resolve all concerns, and write contracts.

Associations assume most of their members will become successful, but the numbers say differently. This is manifested in its long list of worthy education programs, not one of which has to do with basic prospect and sales training. For some reason, associations have chosen to overlook the most important training of all; helping their new members learn how to prospect, list, and sale real estate with the following excuses:

"Who's going to pay for this?"

Can you think of any potential sponsors who would like to meet new agents? I thought you could. There are probably some potential sponsors reading this column who would like to be in on such a program, who need to make a phone call to their local association. Also, most MLSs generate enough money for their associations that they could easily afford to add training. It's a good investment for the association as well as the agent.

"It's the broker's responsibility."

This cry will come mostly from franchise brokers who perceive their training to be a recruiting advantage. Of course, this is the short view, because the better trained all agents are, the better off the industry is.

These members have to understand that they are not serving the board to protect their interests. They are there to enhance the professionalism of all members, as I am sure most do.

"It's complicated."

No it's not. It's simple. The local association has everything in place to make it work. It's a matter of the will. There is nothing complicated about it, set a date and do it.

Here's what I think it will take to get it done.

  1. Offer a two day sales and listing course.

  2. Keep the curriculum focused on prospecting and basic sales training.

  3. Tailor it to your market.

  4. After the first three programs, evaluate it.

  5. Decide what you want to standardize.

  6. Give graduates a certificate of completion.

Make completion mandatory. Send these agents back to their offices with the ability to:

  • Get prospects today.

  • Sell their services.

  • Defend their commissions.

  • Overcome a few objections.

  • Make a professional listing presentation.

  • Professionally show a home.

  • Clearly present the benefits of dealing with a Realtor®

The association shouldn't be responsible for an agent's success. But agent-members should at least know what to do, and what to say in a listing and selling situation.

Here is how to get it done:

Associations can ask for proposals from professional sales training organizations, have them submit a curriculum proposal.

Associations may need professional sales trainers at first, but after standardization, perhaps you could train your own members to become instructors.

The benefits to any association that provides training are:

  1. Higher membership retention.

  2. A great service for your broker membership.

  3. More professionally performing agents.

  4. Greater rapport with your members.

  5. Stronger selling of your association at the customer level.
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David Fletcher, NHCB

David Fletcher is a co-founder and CEO of New Home Co-broker Academy LLC., an online e-commerce business. Visit David's website to take his famous 3-hour online course, How To Build  A New Homes Niche, to become a certified New Home Co-broker (NHCB). More than 5,000 graduates. Content is based on his long career and onsite sales success working with both builders and Realtors to list and sell more than $3 billion in new construction. If you are a broker who wants to offer your agents a way to add new homes to their resale inventory and home shoppers, this is your solution. 

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