Charlie Scott has more than 30 years of first-hand home building experience, much of it in senior management positions with an award-winning, nationally recognized Midwest builder. Currently, he's director of Woodland, O’Brien & Scott for Constellation Homebuilder Systems. Scott helps North American home builders grow their own customer-centric cultures, pursue operational excellence, and increase referral sales. Write him at Charlies@woodlandobrien.com.

Do You Really Want More or Less Realtor Generated New Home Sales?

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It is not a secret to regular readers that increasing a home builder’s customer satisfaction increases referral sales.  Many home builders blow away the 15% national average of referral sales and achieve 40-50%, by virtue of meeting the customers’ hierarchy of needs and having in place a respectful referral sales strategy.

Invariably home builders want their outside real estate agent cooperation rate to decline, as customer satisfaction and homegrown referral sales rates improve.  While this is completely understandable – it won’t happen – in fact, outside real estate agent cooperation usually goes UP!  Let me explain.

Very simply, an outside real estate agent is also a customer.   The more satisfied this real estate agent is (as determined by their client’s customer satisfaction), the more clients that real estate agent will bring to the home builder.  In other words, if the builder makes the real estate agent look good in their client’s eyes/experience, then that real estate agent will be back for more!  We encourage our home building clients to embrace higher outside real estate agent cooperation as a positive consequence of higher customer satisfaction.  After all, a real estate agent’s commission is a variable expense – and I’ll take incremental sales and any associated variable expensee any day as many times as possible, wouldn’t you?

This week’s management meeting question: “Do we have a love-hate, on-off relationship with real estate agents, or do we look at and treat our outside real estate agent network as customers?” 

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December 2016

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