We know that the relationship between builders and real estate agents have been historically challenging. There has been a long gap of distrust that has prevented powerful partnerships from coming together to achieve mutual success. Real estate agents sometimes view their commissions as inadequate on new inventory, while builders aren’t comfortable working with agents who drop in without understanding their product.
However, it’s a very different market these days. According to the U.S. Census Bureau, new home sales were up last year, about 1.3 percent over the previous year. While builders used to own 15 to 20 percent of the business, today they only account for about 7 or 8 percent of the market, at a little over 430,000 new homes. Add in the fact that agents have spent the past few years working on short sales and foreclosed homes for narrow margins, the time seems right for builders and real estate agents to start working more closely together. Here are some ideas to get you started.
Take Advantage of “Start Fresh. Buy New.” Resources
“Start Fresh. Buy New.” is a multi-year marketing campaign supported by over 30 of the nation’s largest home builders. Builders and developers can take advantage of the campaign’s extensive educational website where you can find marketing ideas, building trends and answers to frequently asked questions. More importantly, builders can direct potential real estate agents, who want to form a partnership, to the campaign’s website so they can learn about their product quickly and thoroughly. This helps them understand what they’re selling and turns them into a marketing resource for your home building business.
Take the Time to Educate Agents
While a smart real estate professional can learn the basics of new home design and marketing fairly quickly, it’s worth taking the time to educate them about the specifics of your homes and the character of the neighborhoods where you build. You may not have the budget to hire an in-house sales team, but there are real estate agents that are looking for opportunities to expand. Invite a real estate team to tour your project or hold an open house for one of your finished projects. Most agents will say that they will refer a builder based on their reputation, past projects and personal relationship, and many will require a personal relationship as a critical requirement for referrals. Their reputation is on the line too, so you should have a good sense of one another before you start selling homes together.
Try Out the New Kid on the Block
One of the enduring challenges of working with real estate agents on new, unique or innovative products is that a successful agent with a proven track record is going to rely on their standard approaches and practices in partnering with a builder. If you prefer to work differently, it may be worth the investment to seek out and educate an aggressive up-and-comer with a good work ethic and finely-tuned marketing skills.