How to Hire a Buyer's Agent
WHY
Why hire a buyer’s agent? The top 5 reasons will give you chills, simply because these are 5 things that you absolutely think about all the time and are likely experiencing in your business right now! Any one of these alone would be reason enough to hire a buyer’s agent… experiencing more than one should be an absolute wake up call!!
- You are SICK and TIRED of working evenings and weekends, when you could be spending time with your family. – Hiring a buyer’s agent enables you to NEVER have to work evenings or weekends again! Do what you do best, during normal business hours and leave the evenings and weekends to your buyer’s agents!
- You are tired of your earnings potential being capped, and you want to make an unlimited amount of money! – Eliminate the glass ceiling on your earnings potential forever by leveraging your ideas with other peoples time! “The middle class trades time for money… The world class trades IDEAS for money!” -Steve Siebold
- You hate the roller coaster income that comes along with being a real estate agent who is the lone ranger. By enabling you to focus on lead generation and marketing, buyer’s agents create consistent cash flow for real estate team leaders. No more massive up and down income swings! Hiring a buyer’s agent allows you to create and count on consistent, predictable income month in and month out!
- You want to have more fun! Working with a team is definitely more fun than being out there alone. Let’s face it, working and being alone sucks! Hiring the right buyer’s agents ensures that you’ll never be alone in the battle for success! Synergies will be created, life long friendships formed and untold fortunes made!
- You want to be able to focus on listings! Because you know you must list to last! – The highest paid real estate agents are ALWAYS the ones who LIST THE MOST HOMES!
Hiring buyer’s agents frees up your valuable time, so you can spend more of it bringing in listings, and never again waste a single minute driving buyer’s around from house to house “hoping” they’ll eventually buy something!
When Do I Hire My First Buyer’s Agent?
Quite simply: As soon as you have or can create a surplus of buyer leads.
By surplus, we mean more than you can or want to personally handle. Ideally, team leaders should ONLY work with seller leads. Furthermore, you should ALWAYS have more than one pig at the trough. (please don’t take this as an insult to buyers agents or any other position on your team, it is merely an example illustrated through real world experience).
When raising pigs, farmers know that the secret to helping pigs grow fatter, faster, is to have more than one pig at the trough. You see, when a pig is left alone and fed regularly, they grow fat and are eventually harvested for consumption.
The farmer’s goal is to get their pigs to grow as fat as possible, as fast as possible. This increases the farmers per-pig-profit, and enables them to ultimately grow their business as a whole.
Now, when two pigs share a pen, and in particular, the same feeding trough, they will compete for the food and each will grow fatter, faster than had they been left to feed alone.
The same principle applies to real estate agents! When left alone, agents will eat (earn) just enough to be satisfied, but usually not enough to be excited about selling real estate. When more than one agent shares the same pen (real estate team) and the same feeding trough (lead sources), they will compete for the feed (leads), follow up more tenaciously, serve the clients at a higher level, be more grateful for what they have, argue less and get fatter (richer) faster than if they were left to feed (work) on their own.
We’ve seen it time and time again! The same can also be said for other positions on the team, including administrative positions, listing agents, and even more vendors like lenders!
Having more than one pig at the trough also protects you and the team as a whole when someone leaves or fails to produce at the expected level. This, in turn, further ensures consistent income and predictable growth and profitability.
The most challenging time for real estate teams is when there is only one person in a given position.
Why Would Someone Want To Be A Buyers Agent On My Team?
Not all real estate agents love lead generation, and frankly there are 3 things every agent MUST do to be successful:
- Lead Generation
- Lead Follow Up
- Lead Conversion
Guess which one most agents struggle with? You guessed it: Lead Generation.
Most real estate teams provide their buyer’s agents with as many leads as they can handle. That’s good because there are a TON of great agents out there who are terrific at following up with and helping potential buyer leads!
These agents often times would way rather be apart of a team where someone else (the team leader) does the lead generation, marketing and so on, so they (the buyers agent) can focus on what they do best: following up with, showing homes to, and writing offers for buyers!
Focusing on their core competencies and strengths allows buyer’s agents to sell more homes and even though they pay between 25-75% of the commissions to the team, they make far more money in the long run!
Buyer’s agents, by their very nature, generally prefer NOT to be bogged down in the administrative work. Here again is a place the real estate team leader can bring tremendous value. By providing capable administrative support, team leaders ensure that buyers agents are able to focus on what they are best at: SELLING REAL ESTATE.
Coach Michael Hellickson discusses how he successfully segmented the work flow when the Hellickson Real Estate Team grew to over 44 team members!
By removing as much as possible from agent’s workloads, and enabling them to focus 100% of their time, effort and energy on speaking and meeting with home buyers and sellers, each agent and the team as a whole were wildly more successful.
This model proved so effective, that traditional real estate offices, not team, ENTIRE OFFICES were unable to produce even a fraction of the per agent production (and profit) that this new model generated!
How Will Hiring a Buyers Agent Make Me More Money?
Won’t I lose money by giving 50% of my commission to a buyer’s agent? There is a common misconception among real estate agents that hiring a buyer’s agent (or two or more) and paying them 50% (or similar) of the commission will result in the real estate team leader losing money… Nothing could be further from the truth! (What a limiting belief!)
You see, we all have the same number of hours in each day. At some point, we simply cannot work any more than we already are. One of our Club Wealth Coaching clients comes to mind. We’ll call him Billy-Bob to protect the innocent.
Billy-Bob is what we refer to as ‘poverty conscious”. Too afraid to “lose” what little income he has, he refuses to hire buyer’s agents, fearing the 50% he pays will be “lost income”. He worries that this will keep him from reaching his monthly goals, and his ROI on the $7,000+/month he is spending in leads will be reduced.
Billy-Bob couldn’t be more wrong! You see, his conversion numbers are terrible. He is paying for leads, then paying ISA’s (Inside Sales Agents) to convert those leads to appointments. He is personally going on 10 buyer appointments per week, and cherry picking the very best ones to follow up with.
If all he did was assign the ones he chose NOT to follow up with to 2 buyer’s agents, he would turn 4-10 buyers per month who he is currently NOT converting, into sales!
This would ultimately lead to approximately $20-50,000 in increased revenue, which AFTER splitting with his buyer’s agents would net Billy-Bob an additional $10-25,000 each and every month, WITHOUT taking a single buyer away from the pool he has decided to work with!!
As if that weren’t enough, he could EASILY assign enough leads to buyer’s agents to keep as many as 4 buyer’s agents full time busy, resulting in $20-50,000 in NET MONTHLY REVENUE, going directly in to Billy-Bob’s pocket!
BUT WAIT, that’s not all! (in our best Ginsu Knife Sales voice) Those same buyers agent’s will also produce sales that come from things like open houses, their own referrals, buyers that have homes to sell and more, resulting in EVEN MORE NET revenue to Billy-Bob without him having to give up a single lead that he is currently following up with!!
Silly Billy-Bob, you’re stepping over dollars to get to pennies! You could very easily leverage your current ad spread in to well over $500,000 in ADDITIONAL ANNUAL NET INCOME, without giving up your current income!
*Note from Michael – Incidentally, Billy Bob’s coach and I have been telling him this for 2 months now, and he has yet to hire a single buyer’s agent!! … Poverty Conscious!
How Do I Hire a Buyer’s Agent?
There are tons of ways you to find a GREAT buyer’s agent, or even more than one great buyer’s agent. Marketing to your vendors is the very first thing you need to do. Finding the perfect buyer’s agents won’t come easy if you don’t market to them!
- Cold call the agents in your market
- Ask for referrals
- Ask your lender
- Ask your title company
- Ask your home inspector
- Ask escrow
- Ask home warranty company
- Ask your broker
- Ask every agent, lender, broker, escrow officer, or attorney on every cross sale who they know.
2. Place your ads in all of the following places:
- Facebook – Make sure to boost your post!
- Indeed
- Craigslist
3. Email local agents in your market
INTERVIEW
When you are setting up the interview, you are going to do it as a group interview and have everyone arrive at a specific time. DO NOT TELL THEM THIS IS A GROUP INTERVIEW. There are 4 primary reasons for this:
- There will be no-shows
- Synergy and excitement are easier to accomplish in groups than one on one.
- People will learn from the questions others ask.
- Your time has tremendous value.
Not very many candidates will show up knowing it is a group interview. Do not lie. Instead, simply tell them to come down to the office, so you can tell them a little bit about you, your company and the position. If needed or helpful, offer to give each attendee a buyer lead just for showing up, then do it!
The group interview is a very effective way to leverage your time. There are many things that you can tell the interviewees as a group that will save you time on the one on one interviews. This also gives you the chance to see who stands out and would be the right fit.
- During this group interview you should talk about the following:
- Company History
- Personal Backstory
- The team
- Production level of the team and future goals
- The position on the team
- What you are looking for in a Buyer’s Agent
- Mention that you could be hiring more than one agent. We don’t let good talent pass by!
- The structure
- Team supplied leads
- Admin team completes TC work
- Team Huddle
- Team Meetings
- Number of Calls/Day
- Minimum Closing per month
- Other expectations
STRUCTURE
This will be talked about in the group interview. Letting the potential agents know that you have systems in place and enough leads to keep them busy is a must.
Providing your agents with ideally 50 leads per month per agent and letting them know what program you use to route your leads is necessary as well.
Your administrative team should be doing all of the transaction coordination work. Mention in the interview that the buyer’s agent can just simply give the paperwork to the admin team, show up for appraisal and negotiate the inspection, and move on to the next buyer!
There is a minimum of transactions they are expected to be closing each month, ideally 2 per month at a bare minimum. You should also discuss the daily team huddle and the weekly team meetings, and specifically how each will help each team member (especially the buyers agents) close more transactions.
COMPENSATION
This is a buyer agent split that is very generous. Most teams offer a straight 50-50 split for every transaction. The model above allows your buyer’s agents to make a little bit of extra money, if they will just go that extra mile and close one or two more transactions this month.
Something to keep in mind, NEVER advance commissions or money to your buyer agents. It is a very slippery slope, and once you go down that path it is extremely hard to turn back.
SELECTING THE AGENT
Keep in mind that you will likely need to hire more buyer’s agents than you think you need. This is because one or two of them will end up quitting.
At this point in the interview you are going to want to say something like, “for those of you that are interested, let’s sit down for a one on one chat about your goals, and whether or not we are the right fit”. From there you can then select the agent(s) that best fit with your team.
Hiring buyer’s agents is “mission critical” to building a career and a lifestyle that allows you to make a great living, while enjoying more than enough time off. Second only to hiring your first assistant, hiring buyer’s agents is the biggest game changer you and your business will experience.