Ever heard of the MORI IPSOS Veracity Index? It is an annual poll carried out by the organisation Market and Opinion Research International, which surveys the nation's trust in professions. Sadly it paints a picture of an all too negative perception for the average estate agent.
Just 30% of British adults (aged 15+ interviewed face to face during 18-27th Oct 2019) "trust estate agents to tell the truth".
Estate agents feature in the 5 least trusted professions, along with journalists, advertising execs, government ministers and politicians generally.
Here is why I think this is the case.
If we believe that financial remuneration drives a certain behaviour in business, then it is no wonder that estate agency in some quarters has a questionable reputation. Estate agents are not bad people. The vast majority of property industry employees want to do a good job, to help people to move home successfully and with the least fuss – and to earn a reasonable living for themselves. But the problem with the traditional estate agency model is that the way that its people are paid is not necessarily conducive with a great experience.
What exactly do we mean by that?
Believe it or not, where a fee of say 1.5% of the property sale price is earned, an individual agent can sometimes earn just 5% of that (plus their basic salary). For example, if we take a £300,000 property where the seller pays a fee of £4,500, the agent earns £225. In addition, each transaction might take six months to complete. Motivating?
A remuneration approach such as this can potentially encourage apathy towards customers. It can also force agents to run from one transaction to another trying to spin many plates in order to try to earn a decent income. Inevitably, those plates can drop when there are too many to keep spinning at once. It is incompatible with a positive outcome for the customer and can only serve to make an already stressful process worse.
But what if - as with the Keller Williams model - the agent that does the work and faithfully attends to the customer 24/7, were to be paid a larger proportion of the commission, instead of that money being channeled toward multiple branch office rents, rates, staff, car leases and so on? Well, that’s the way that the Americans have been selling real estate for decades and is the reason why, unsurprisingly, the USA has a much better reputation for real estate service and efficiency.
Keller Williams isn’t just an American business operating in the UK. It is a global company, the largest estate agency in the world, with 192,000+ agents operating in 44 countries. And whilst cultures and legal systems are of course different from market to market, one thing for sure is that no matter which continent you live on - if you pay people properly so that they enjoy their work, covet success and deliver exceptional customer service, it is a win-win for all parties concerned and that certainly drives good behaviour in any language.
If you would like to know more about who we are and what we do, please get in touch with me on 07487805780 or joshua.smith@kwuk.com. I would love to have a chat.