Editor’s note: Real Estate Day in the Life is a recurring Inman News segment in which we spend time in the field with real estate agents. These articles offer insight about everyday issues in the real estate industry, differences in agent approaches to their work, and the wide variety of brokerage business models.
ZipRealty agent David Kerr’s office includes rows of real estate-related manuals and books, a copy of "Poetry of Robert Frost," his desk and computer, and an assortment of cat toys.
The company’s main office is located in Emeryville, Calif., but Kerr, like most of the company’s agents, typically works from home. Agents come to the office for training and sales meetings, and occasionally to make calls and work with their leads.
Kerr has been with ZipRealty for six years, and the company was founded in 1999.
He earned a bachelor’s degree in the history of art from the University of California, Berkeley, and managed his own carpet-cleaning company. Kerr had also dabbled in photography, and although he’s had a number of photos published in textbooks he says the market for stock photographers shrank.
Then he found real estate.
"I’ve always like houses and I thought — that’s an interesting process," Kerr says.
He was with Better Homes Realty for three years, but he says he was not satisfied with the results at that job.
"Zip said, ‘We’ll give you clients, we’ll give you money, a fax machine, a car,’ " he says.
ZipRealty agents are employees. Among their benefits they receive health insurance and a 401(k). The company provides client leads, technology, marketing materials, training, and broker and transaction support. Compensation is based on commission and is not a salary.
The company offers discounts to sellers and rebates to buyers. As of April 2008, ZipRealty had rebated an estimated $100 million worth of real estate commissions to buyers since its 1999 launch.
Despite a downturn in many housing markets and net losses for the publicly traded company, ZipRealty has continued to grow its agent force.
"We have added nearly 400 agents this year so far and we are recruiting a lot more experienced agents than we have in the past," says Leslie Tyler, vice president of marketing at ZipRealty.
"Many great agents are tired of trying to run their own Web sites, pay up-front for listing expenses, and spend most of their time finding clients. ZipRealty takes care of those things for agents so they can take care of clients."
At the end of the first quarter, Zip announced a net loss of $7.3 million or 31 cents per share (compared with a net loss of $3.1 million in first-quarter 2007). In the second quarter the brokerage company had a net loss of $1.7 million. That compares with a net loss of $1 million in the same quarter last year. Net revenues were $20.6 million in the first quarter, down 11.8 percent compared to first-quarter 2007.
At the close of the second quarter the company had 2,559 agents, compared with 2,070 agents at the end of second-quarter 2007. The company’s agents closed 3,121 real estate transactions in the first quarter compared with 3,110 in first-quarter 2007, though the dollar volume of transactions declined 15.3 percent. ZipRealty also announced a lawsuit settlement over its compensation practices.
Kerr turns on his computer and logs onto ZAP, or the Zip Agent Platform. The first thing that pops up on the screen is the "new registrant" notification. Kerr checks the information on a potential new client to find out who the client is and what the client is looking for. He says he always contacts prospective clients within 12 hours to let them know that he is a "real person."
The site also displays Kerr’s e-mails and all correspondence between himself and his clients, who have their own accounts on the site. John Oldham, ZipRealty director of marketing, says the company’s lead allocation process is managed on a daily or hourly basis. The client selects cities or ZIP codes to search properties.
The site also updates clients’ preferences and searches. If a client decides to look in a different area, that client can be transferred to a different agent who is better acquainted with a specific region.
Kerr checks to see if any clients who were on a different platform were moved to him. The ZAP site manages who is assigned to which Zip agent, and Kerr sometimes recommends other agents in the company who he already knows. There are no referral fees for moving clients back and forth. Kerr sends his clients new listings as they update their search parameters.
He has personally bought a property for himself using ZipRealty before so he understands the experience on both sides of the transaction.
Kerr says, "We work as a team. We recognize that we’re not the important ones here — the clients are."
Tyler says, "Some of our agents are team leaders and provide mentoring and help to other agents, and agents can always get a team member to cover for them if they have an emergency come up."
A menu called "Rising Stars" reminds Kerr which clients assigned to him have recently been active on the Web site and who he needs to contact for more information. Rising Stars include "Top Clients," which is a list of clients who Kerr keeps in contact with at least once a week.
Kerr sees a new client has e-mailed him about her search. He picks up the phone and leaves a message for her, reminding her that she had contacted him. He promises to follow up with her by e-mail. And he does.
"I’ve created a bunch of cut-and-paste e-mails rather than having to type the same thing over and over again," he says as he pulls up a Word document with messages for several different occasions.
"We’re seeing different trends in communication," says Oldham. "Different clients like to be communicated with differently."
The daily goal for Zip agents is "20-20" — they try to make 20 calls a day followed by 20 e-mails. The ZAP page called "Agent Dashboard" — "what I see every morning," says Kerr — displays all of his contact history for his clients and prospective clients":
Daily average phone calls for the month: 14.
Daily average e-mails to clients: 8.6.
Response time to clients: 2.2 hours.
Client pool contacted: 97.7 percent.
Rising Stars contacted: 98.5 percent.
"It’s my responsibility to make sure they get what they need," he says. "If I go out of town or up to Sonoma for the weekend, I take my laptop." Kerr works with electronic documents and says people are moving toward electronic signatures instead of sending faxes, which simplifies paperwork related to sale transactions.
"The challenging part comes when you’ve got more than one open escrow — making sure the client is treated equally and gets good service. Client satisfaction surveys are sent out after each escrow is closed," he says. "We communicate with our clients; we don’t put them on hold. We actually answer our cell phones."
ZAP is also available on mobile devices, Kerr notes as he checks an e-mail from his director on his Samsung phone.
"That’s saved my butt a number of times, if I needed to get a phone number," he says. "If you’re out and about you can go through the (multiple listing service) and look properties up as well."
Because Kerr does not visit the office often, he manages all of his marketing materials from home. ZAP allows him to design fliers, signs, notes and posters for properties using pre-designed templates. He then checks the MLS to make sure the information matches.
"The system does all the marketing for me," he says. "It automatically sends e-mails from me. In traditional real estate, you spend your time making cold calls. (These) are warm calls."
ZAP sends out a variety of automatic e-mails to clients to check in on the home search, inform of the benefits of pre-approvals and invite clients to look at homes. Automatic listing updates are sent out when clients set up a home search in any region, which includes Kerr’s contact information.
"These automatic e-mails are supplemented by personal e-mails," Kerr says. "Zip pays for the fliers, Sunday open ads, and all of the Web site marketing."
Kerr does not have a traditional 9-to-5 job. The upside of working from home is the ability to work flexible hours, he notes. Kerr sometimes takes a swim during the day and then returns to work, but he says that his work has the ability to suck him in.
"I will come in here (to my office) intending to spend half an hour, and three hours later (it will be time) to meet a client. There are some days you will work 12-14 hours a day."
Kerr prepares paperwork to meet with a client with whom he will be showing homes in the West Oakland area. He scrolls through listings on Paragon 4, the East Bay Regional Data MLS online platform.
Kerr is the director and incoming president for the Oakland Association of Realtors and a director for the California Association of Realtors. He says the association is in the process of setting down rules and parameters for a new design for the statewide MLS initiative. The initiative, called CALMLS, aims to establish a statewide property information database that could potentially be the default MLS system for Realtors across California. He finds the details on each home in the MLS and clicks the print button.
"The other part that takes up all of your day — waiting," he says as he leans back in his chair, waiting for the printer.
The homes that Kerr will be showing today are bank-owned foreclosures, or real estate-owned (REO) properties that have been bought back by the banks through a foreclosure process.
Tyler says, "One of the biggest challenges we’re dealing with is the large increase in distressed property sales. They take much longer to close and can be a source of frustration for clients who are not prepared for approval delays and having someone else overbid them. So our teams have to work harder to educate and prepare buyers for a sometimes difficult process."
Some clients are hanging back these days, Kerr says, adding, "People need to recognize that the market is great for buyers. Sometimes the media says the market is otherwise."
From home searches to broker tours, the process of buying a home can be exhausting, but Kerr says the most rewarding part is when he finally gets to close escrow and hand the keys over to the client.
"Then they realize they have to mow lawns and make a mortgage," he says. "Part of the fun is doing all that and making it a home, doing the little things."
ZipRealty agents work with residential properties up to four units and do not work with commercial properties. The majority of Kerr’s work is with single-family detached homes in the Oakland, Berkley, Piedmont, Richmond, Albany and Alameda areas in the San Francisco Bay Area region. He particularly enjoys working in the Richmond Annex, a neighborhood in southeastern Richmond.
John Oldham and David Kerr get into Kerr’s Saab on his way to meet a new client. As he drives through a neighborhood in West Oakland, Kerr comments on how much the area has changed. He passes by the old 16th Street Train Station that operated from 1920-41 and the Central Station housing development. This development is in one of Oakland’s oldest neighborhoods and used to be at the end of the line for transcontinental rail passengers.
There is an old Victorian undergoing rehabilitation, beside which is a lot that Kerr was preparing a flier for. A sign hanging from a barbed wire fence displays his name and phone number. The redevelopment brings a broad group of prospective buyers, he says. "Revitalization — that’s always a good thing."
The first house his client will view is an 1883 two-story Victorian. It’s a fixer-upper. The stripped walls reveal redwood framing, and the white linoleum in the kitchen is chipped here and there, with orange tile peaking through. The stairs don’t have handrails. The large rounded windows have intricate detailing on the framing — details that aren’t common in modern architecture.
Kerr walks around and surveys the space as he keeps an eye out for his client. The client is looking for something to invest in and something that’s rentable. She is obviously not afraid to do some work, and she walks around the space with her three curious daughters.
"They like looking around," she says of her daughters. "They think it’s some kind of adventure."
After just a few minutes she decides this house won’t do — she tells Kerr how she doesn’t like the staircase that leads directly toward the front entrance. Feng shui 101: A staircase that points to the front door suggests that the energy will flow straight out the door, says Kerr.
Designs like this are common among Victorian homes, but if the client doesn’t like it you just move on to the next one, he says. The ZipRealty Web site displays everything from for-sale-by-owner properties and REOs to pre-foreclosures and empty lots.
"Zip allows the client to drive the transaction," he says. "The nice thing about the site is that it doesn’t filter — it shows you absolutely everything. You get to filter it."
As he drives to the next home on the list, Kerr navigates the one-way streets and no-through streets in the area.
"I just remembered the most challenging aspect of my job — trying not to lose the client behind me," he jokes, as he checks his rearview mirror for her minivan.
With her navigation system-equipped minivan, his client takes the lead. Driving by the property, she pulls down her window to tell Kerr it’s not what she’s looking for. Onto the next one.
After two more, one on Fifth Avenue and one in what used to be called "Brooklyn," it’s time to call it a home-touring day.
Kerr recaps the day with his client. "Was it better than you expected or worse than you expected?" he asks.
She is most interested in the one-story property on Fifth Avenue — it’s near the new Chinatown area and within walking distance of Lake Merritt.
Despite the gaudy colors of the mint blue walls, the tall windows covered in mint blue lace curtains, and the lowered ceilings, the client and her curious daughters are still charmed by this Queen Anne and its orange and lemon trees in the front yard — the remnants of its original luster seem to inspire them about its potential renewal.
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