Editor’s note: This special four-part series will explore who controls the average real estate transaction, who or what is challenging and changing that central role and how it impacts the industry and consumers. (See Part 2: Battle is on for real estate consumer, Part 3: Web pushes realty agents out of spotlight and Part 4: Lenders woo and sidestep real estate agents for customers.)
You give them your home phone number, your cell number and home address. You invite them into your living room and show them your dirty closets. You share your personal financial information with them, discuss your divorce with them and they know what church you attend. You ride around in their car and talk about your job, your dreams and aspirations.
You don’t do this with trusted brands like Microsoft, Federal Express or Home Depot. But you do so with your local Realtor.
As consumers, we give our local real estate agents immense power over our decisions.
And that explains why agents control the average real estate transaction. They live and breathe the consumers’ needs at a time when they are making a game-changing decision: where to live. A Realtor becomes the trusted go-to-person for things like which lender to use, which home inspector to consider, which title company to select, which handyman to use and where to shop for groceries, day care and lawn furniture.
Moreover, agents’ interests are closely aligned with the consumer; the Realtor gets paid when the moving truck shows up to relocate the buyer or seller.
Who controls the average real estate transaction? Take a survey.
It’s not surprising that Internet services, mortgage lenders, title companies, real estate brokers or franchises haven’t dislodged the agent from the center of the transaction. Hundreds of millions of dollars have been invested to do just that, but so far the agent remains the trusted consumer partner in the primary decision of what home to buy, as well as what lending, title, escrow and legal services to use.
Bundled services, point of purchase, affinity partnerships, capture goals and affiliated business relationships are all code for strategies to dislodge the agent. But which of these efforts have materialized, who is succeeding, who has failed and why? What is best for the consumer and what is best for the industry?
This four-part series, “Point of Purchase: Who’s in control?” explores these initiatives and whether anything will truly change.
On Tuesday, the second part of the series, “Battle is on for real estate consumer,” takes a look at who consumers turn to as their first point of contact in a real estate transaction. Industry players increasingly compete for that number one position and brokers and agents continue to defend their relevance to consumers.
The third part of the series, “Web knocks realty agents out of home-sale spotlight,” will appear on Wednesday. This part explores innovations on the Internet, one of the biggest threats to realty agents’ center position in a home-sale transaction. Lenders, for-sale-by-owner networks, brokers and online companies are reaching out to consumers as the first point of contact.
On Thursday, the last part of the series, “Lenders woo realty agents for customers,” explores how lenders are approaching consumers for real estate purchase transactions. Despite these approaches, large lenders are actively partnering with real estate brokerages nationwide in order to get closer to real estate agents.
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