“To be successful in real estate, you must always and consistently put your clients’ best interests first. When you do, your personal needs will be realized beyond your greatest expectations.” – Anthony Hitt
There is an ever-increasing shortage in the availability of houses for sale in most major Canadian cities, including Toronto. As a result, property prices are being driven up, and real estate brokers are having to work harder in order to close deals and make sales.
Furthermore, there is a shortage of disposable cash, caused by the various global geopolitical and socio-economic crises. For example: there is no doubt that the election of Donald Trump as the 45th president of the USA is having, and will continue to have a significant impact on her trading partners’ and surrounding countries’ economies.
The housing market: making sales
In order to attract clients, real estate brokers will have to offer both the seller and potential buyer extra benefits such as paying part or all of the closing costs as well as offering a lower percentage on each sale. As a result, it can be said that the single driver of the trend towards low commission real estate is the lack of stock which is available for sale. In other words, real estate brokers are offering a full package of real estate services for as low as 1% commission.
Carolyn Ireland of the Globe and Mail newspaper spoke to Royce Mendes, a senior economist at Canadian Imperial Bank of Commerce, about the impact of the election of Donald Trump on the Canadian economy, and in particular, the real estate market. She notes in her article entitled, ‘Trump risk’ hangs over Canadian real estate market, that “Mr Mendes acknowledges that it’s difficult to forecast around “Trump risk” because of the contradictory signals coming out of the United States. But with threats of a border-tax adjustment and renegotiation of the North American free-trade agreement, there’s a chance his 72-cent forecast will turn out to be too optimistic, he acknowledges.”
The importance of customer service
While there are very few houses available in relation to the number of people who are looking for houses to buy, it’s not all doom and gloom. It is entirely possible for real estate brokers to survive in the current market conditions. The secret to survival is how you approach your potential customers. We have spoken at length about the need to offer additional benefits that other brokers are currently not able to provide; however, it is more important that you offer your clients a superior customer experience.
It is well-known that most customers will partner with a broker who is slightly more expensive but is customer service orientated. Therefore, it makes sense that the ultimate attraction is a combination of superior customer service and a reduction is the account that the buyer and seller will be required to pay you for your services. The trade-off is that you will have to work harder for your commission; nonetheless, you will garner a good reputation, which in turn, will ultimately result in an increase in the number of people who would like to do business with you.