What I write in this article will be controversial. Traditional real estate agent theory suggests that a broker should stake out a position in a small sliver of their respective markets so that they have a firm and thorough understanding of that area, be it a neighborhood, subdivision, or string of homes.
In return, they earn all the sales in their “farm” and continue to dominate for years on end.
That’s the theory at the least.
In reality, how many neighborhoods do you see where all the sales are being conducted by the same agent?
I would like to argue that there are very few.
If you’re an agent reading this that happens to be in that position, my hat to you, but for everyone else, it usually doesn’t happen that way.
Now don’t get me wrong. I believe in the “farm” method (where you market to individual neighborhoods over a long period of time). However, I would never rest my entire business in just those neighborhoods.
Real Estate is Changing
There’s a reason 80% of real estate brokers are not in the business within five years after starting.
Something’s clearly wrong with traditional real estate theory and I think it’s due to many reasons that I will talk about throughout various articles I’ll post in the future. As well as other content I upload (If you haven’t already, check out my YouTube Channel).
I think the simple fact of the matter is that the world is changing, and most real estate agents haven’t adjusted.
Technology rules all now. It’s torn down borders, connected people who live miles apart, and has gone so far as to allow a doctor to treat a patient over skype (telemedicine).
With the world becoming so closely knit, why is real estate still local?
From what I know, as of the current moment of writing. I’m the only real estate broker in my region that is willing to drive two hours to Charlotte, North Carolina, from Asheville, to list a client’s home.
To me, real estate has no borders. I’m a national agent. And I love it.
Being a National Agent Works Better With Luxury Markets
Becoming a national agent is new.
Most agents stay local, and always will. But for those that want to travel and reap the best results from their business, will become an agent that provides service anywhere and everywhere.
I’ve found that this is more doable as a luxury real estate agent for a few reasons.
It must be worth traveling. If you’re like me and live in Asheville, North Carolina. A flight to Philadelphia, PA and back will cost me a couple hundred dollars. Not to mention other expenses like lodging and food once I’m there.
Then you must list the home, stage it, get photos, take video, etc. All of this can cost thousands of dollars (luxury market expenses are expensive). Then there’s the marketing expenses and after you’re all set and done, you’ve also invested a lot of time.
However, if the luxury home you listed was $5 million with 3% going to you in professional fees. That’s a pretty $150,000 check before brokerage splits.
Suddenly an impromptu trip to Philadelphia doesn’t sound so bad does it?
If the home being listed is only $300,000 with 3% in professional fees, then you’re looking at about $9,000 after it’s all finished with.
It might still be worth it. I won’t say $9,000 isn’t a lot of money, but unless you have the volume to back you up elsewhere, the time investment wouldn’t be worth it to me.
Luxury Clients Demand the Best
I don’t mean to toot my own horn but the only reason any person is going to request my services to sell their house in another state is because they know I’m the best.
Luxury clients want the best, they can afford the best, and they will usually get the best.
I’m not saying that non-luxury clients don’t want the best. Everyone always wants the best they can get.
However, in a saturated pool of real estate agents. How is anyone going to sort out the best from the crowd? Most people usually end up with whatever name they hear the most or whatever agent they stumbled upon at an open house.
These agents could very well be the best. But they probably aren’t.
One of the reasons why I choose to operate in the luxury market is because of the severe lack of competition.
This is a sound business decision. Why compete with 2,000 when you can compete with 50?
When you traverse your way to the top. Luxury clientele just seem to know. Then you’re demanded.
Why It’s Better to Be a National Agent
There are clear benefits to be a national agent. Even on a cross-regional level, which is the starting point.
You’re no longer in the eyes of a single city or community. You can increase your exposure tenfold just by playing in multiple markets. The more prospects you can target, the better.
Cities have different cultures. Maybe the direct mail campaign you ran in Austin, Texas you ran didn’t go so well, but the same campaign in San Antonio boasted amazing results.
Now you can make YouTube videos and not try to pander to a single audience in your small city and lose out on tons of possible clientele because they live somewhere else.
You finally don’t have to buy a website domain that includes your city’s name and can build a real brand. I get so annoyed by websites like “Albuquerque Broker” when the name of the team is DwightSellsRealEstate (this isn’t a real-life team by the way, and if you’re name is Dwight and sell real estate, I appreciate you).
We all know that people remember brands well.
The argument against this notion is that for each product category, the average human can only name two to three separate brands related to it (ex. Coca-Cola and Pepsi).
But if we think about this, and I mean really think about it. If most other real estate agents aren’t building powerful brands, then would it be that hard to become the number one real estate brand that people remember?
What would you remember better? Berri Properties, with its gold logo and red berry dots, or Matthew Myre Real Estate?
Anytime there’s more exposure. Odds are you’ll have a larger pool of clients.
Being in luxury real estate, putting yourself in front of more clients means you have the ability to increase your income levels beyond your imagination.
For example, you sell two homes priced at one million dollars apiece. Your professional fees from those sales can put you in the $60,000 range for the year, a healthy income.
Now triple your market exposure and sell six homes at one million apiece. That’s $180,000. You get the point.
The greatest thing about luxury real estate is that not only is it more enjoyable to look at incredible luxury mansions. But it’s super profitable.
Because you have more clients, experience follows, and now your services are refined and mastered over time, making you the quintessential luxury broker for your region, let alone city.
Better Understanding of Luxury Real Estate
Think of national agents as world travelers.
When someone ventures to another corner of the world, say Europe. They experience new things and are exposed to different cultures. When they return home, they realize how many great things their home isn’t doing, and suddenly, they’re more knowledgeable than their peers.
As a national luxury agent. You’ll see many architectural styles, interior designs, floorplans, and materials that your home market alone simply couldn’t produce.
Now you have the upper hand against your rival agents, and can offer better service, better knowledge, and better experience.
Let’s say your client has a beautiful five-bedroom, six-bathroom single-family mansion with a twelve-foot-high foyer, elegant marble countertops in the kitchen, and white oak flooring in a sprawling open floorplan, maximizing natural light, letting the marble and white oak finishes to gleam with energy.
They want to list that home for $2 million and it’s the only luxury property like that in your area but the latest property to sell went for $1.6 million.
In your head, you know that a property almost identical to this one just sold in Charlotte, NC for $2 million but you’re in Asheville. What do you tell your client?
I tell my client that we’re going to list the home for $2 million.
I create a marketing plan to follow, citing the reasons why it’s a bargain for that home to sell at $2 million dollars, and I do what I do best.
Sell luxury homes.
I create markets as a national agent. I know what’s out there, and I know how to sell, and I serve my client’s best interests. If I know I can sell a home for $2 million, I’ll sell the home for $2 million.
Whatever it takes.
The Difficulties of Becoming a National Agent
Being a national agent isn’t without its challenges.
The first hurdle, of course, is getting licensed to sell real estate in multiple states. Some states allow online classes which are helpful but some, like North Carolina, require you to be in person.
The list of states that allow online classes and ones that don’t are on this helpful website.
These courses aren’t easy, and obviously it will take money and time to complete them, but on the flip side, it widens your playing field considerably.
Another thing to pay attention to is reciprocity agreements some states have with each other.
You could get licensed in one state that has reciprocity with others, thus allowing you to sell there without further licensing, or at the least, reduced requirements for licensing (ex. no classes, just test).
You’ll have to make a quick Google search to look up the laws for each state.
Just like real estate in general, the beginning is the hardest part. Taking those initial trips to list a home will cost money and time and most of your feelings will be uncertain about whether this will work or not.
That’s okay, just make sure you win the million-dollar listing and it will all be worth it.
Of course, you’ll need the funding to do this at all.
The biggest testing ground will be your home city. If you can net a sale at home, then you should be able to replicate that in other markets. If not, then you might want to rethink your strategy before amplifying it.
You Don’t Know Until You Try
There’s no doubt that this is a very different and entrepreneurial approach to real estate. However, I believe it to be very rewarding. It’s all about exposure and creating a brand across the nation so that you can create an endless stream of clientele.
Nothing’s better than that.