The residential real estate industry has for years believed in truths that, well, could be argued as simply untrue. And, at best, I think these things are myths.
Bombarded by new approaches, tales of opportunity, shiny objects and sensational threats about the demise of the industry, people in real estate have come to accept notions and ideas that could be debated.
So what are these things and why are they thought to be false? Because the promise they made to the industry has not been kept.
So, I have chosen what I believe to be the top five myths to explore today.
1. Internet leads are leads
There is no doubt that we have been sold “leads” when someone inquiries about us online, but are they really leads? I suppose at least a part of that belief is due to what we have been charged for these online leads.
If we paid for the online leads, the assumption is that they must have some value. At least they are of higher quality than traditional inquiries. Or are they?
Signs placed in lawns generated sign calls. Ads placed in magazines generated ad calls. And yet despite that, sign leads and ad leads never existed. They were then — and remain today — inquiries. After all, would you pay incrementally for a sign call? Or an ad call? Doubtful.
How big is the pool? How new are the bathrooms? Why are they moving? When was the roof last replaced? All inquiries, no matter how they are communicated, are just inquiries. And the myth is that these questions somehow disappeared and leads appeared in their place online.
A lead is a qualified inquiry in which a connection has been made to pursue a potential transaction. So some inquiries turn into leads, but not all inquiries are leads.
The lesson learned? Yes, answer those Internet calls, but remember, they are really no different than all of the other inquiries we receive in this business.
2. Agent and broker websites are effective
Now before you launch out of your chair in rage, hear me out. There are dozens of providers of broker and agent websites out there today. How effective are they in the overall scheme of the consumer’s online real estate experience?
A website cannot be relevant if it has a bounce rate greater than that of an NBA basketball. And that is what we have in this business.
If you think that the IDX search functionality offered on your website is something acceptable to consumers, think again. And if you have been promised anything to do with SEO or SEM that pretends to be “effective” by a vendor who charges you $125 or even $25,000 per month for your website, that is pretty much a total myth.
Keyword search is where it’s at — and it is nowhere to be found in broker and agent websites. The days of using endless drop-down menus are over, my friends.
When presented with that root canal experience, consumers bounce from your sites right back to Google, Bing and Yahoo. And when they do that, the search results do not direct the consumer to your website. The winners of that game are the major portals.
Winning in the website vs. portal game as a broker or agent is a myth. Doing this requires immense resources like hundreds of millions of dollars a year and an index of a hundred million properties (of which fewer than 4 million are actually listed at any one point in time).
3. Consumers are engaged with our industry
I hear agents and brokers who declare they have absolutely figured this one out. Game over. Really? And when asked how they accomplish this really challenging dynamic they explain “they have a relationship with the client.”
Well, people have meaningful relationships in life, but they are not ordinarily with their real estate broker or agent. In contrast, I have a relationship with Amazon but it is solely based on what its platform does for me, not because I think Jeff Bezos is a nice guy and I like him.
The quality of consumer engagement in this business sucks. The portals have figured this out, and because the information we receive from the MLS industry is limited — they do it better and they win.
We need to understand that consumer engagement in this business is a myth that is only supported by the fact that we have “taken the market captive.”
In other words, we have tied up the seller with a listing agreement, and we make the offer to provide assistance in making sales. But holding the consumer hostage does not really count as “valued engagement.”
4. Brands in real estate are relevant online
This one wasn’t always a myth, but it certainly is today. If more than 95 percent of all consumers begin their search for a property online, this one needs to be taken very seriously.
So put on your consumer hat.
What do you type into the Google search bar when you want something? The brand, or the desired thing you are searching for?
So, nothing is different in real estate. If I want a four-bedroom, three-bath home on the water in Newport Beach with a boat dock, that is what I search for online.
Consumers do not search by broker or agent brands because that is not the product they are looking for when they go online.
I will argue, though, that once a consumer arrives “in the market,” strong brand presence can hijack the online traffic. Meaning that the visibility of a brokerage company is quickly revealed by the presence or the lack of signs and office locations in real life that may otherwise be masked or unknown online.
To hedge against the loss of brand value in search, simply be a listing machine. When someone wants what you have listed and buys the property, you are a winner.
5. The agent is at the center of the transaction
I saved the most important myth for last. In my 36 years in this business, I can say that the biggest concern I have for the industry is that we somehow believe this to be true.
The consumer is and will always be the only party at the center of the transaction.
It’s because we have been told by NAR (National Association of Realtors) and others in organized real estate to believe this myth that we are now under a continued attack as an industry by all those who clearly understand that we are not at the center of the transaction.
Think about it. All of those who have entered this industry have done so because they put the best interests of the consumer first.
Dispelling the myth that “it is all about us” in everything we do and continually improving what we do for the consumer experience should be centric in this business of service.
So have any myths been dispelled? I hope so, or at least I hope that this might set the stage for a healthy and open debate that is required to create immense new opportunity for our industry.
Kenneth Jenny is an expert in the residential real estate brokerage industry and real estate marketing.
