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ZOOCASA AND COMPETITION IN THE CANADIAN REAL ESTATE BROKERAGE SYSTEM

ZOOCASA AND COMPETITION IN THE CANADIAN REAL ESTATE BROKERAGE SYSTEM

I have been involved in every facet of the real estate brokerage business for 33 years. Over those 33 years I have experienced a lot of change in our profession. Each time there is change there is also a huge fear and concern over that change. Naturally this is a purely human and natural way that we all react to change.

The concern of change is directly tied to the amount of control we have in determining the change and how we perceive the negative effect on our lives the change will bring.

Yes everyone is reading and experiencing how the latest technological tools will bring huge financial benefit to the consumer. When we turn on a radio or TV or read an online advertisement, everything is being commoditized. Newer, cheaper, over and over again, we hear that price point is the differentiating point by the buyer. In a hard consumable commodity such as toothpaste or breakfast cereal or a television or a computer, that may well be the case. Yet even within hard commodities there are premium brands that don’t compete on price point, they compete on value and benefit.

When it comes to service industries such as real estate brokerage, commoditization is much more difficult, but can be achieved if allowed to be. Our goal as REALTORS® should be to ensure consumers truly understand the benefits they receive when dealing with a full service brokerage. We are fortunate that a well articulated value proposition will be successful in earning business.

But the key is to be well prepared and rehearsed before going in and sitting around the kitchen table with the potential client. This means that you have to take full responsibility to know what you and the RE/MAX organization brings to the table. Over the years, many agents have simply used the “gate keeper of the data” concept as their only service advantage. Today that no longer exists. Consumers are more empowered than ever in selling and buying their home. They have the hard data; they require interpretation of that data. They require the counselling services the REALTOR® provides. They need the all encompassing marketing plan to maximize their home’s value to allow them to make the move they want. They need a full service agent now more than ever, given the ever increasing complexity of the home transaction.

Ultimately, each agent has to take the time to be fully versed on every tool or service that is provided. Each sales associate has to fully understand how to implement these services and to know about the various affinity relationships that can be provided to the consumer for their financial benefit.

In the last few days I have received a number of calls and emails asking us, what are we going to do to fight the Zoocasa marketing plan and the consumer benefits they are providing? Further, this kind of competition will force us as sales associates to reduce our commission rates to compete.

As I have already mentioned, there is no need to panic over this. We do provide a number of consumer direct benefits. For example, the Tranquilli-T program is such a service. Yet it is completely underutilized as a true customer benefit that no one else can provide. Another is our TD Canada Trust affiliation as a tremendous tool that can be leveraged as well; we have mortgage calculators on our web site and mobile apps. We have the Fit To Sell and Fit to Buy programs that have proven to be very popular. Our web site features “walkability scores”. Our mobile app is the only app in the entire industry that has “Live View” (being enhanced with the ability to take photos and listing information to store in the “My Listing” feature). Our web site has a space planner tool. You can easily build a virtual tour and personalized promotional items for each listing using the Design Centre. You can create a QR code for each listing that will point potential buyers to listing information. We have the only multi-lingual web site, global.remax.com for home listings to be featured on. There is so much that we as a Brand offer consumers that are part of your full service brokerage proposition.

It is no longer sufficient to simply walk into a home, complement the owner on what a wonderful job they have done on decorating the home to get that business. You MUST be able to fully explain and articulate absolutely every advantage they will gain by working with you as opposed to a discount commission company or a Zoocasa representative.

You have to be accountable for your service. All too often consumers have had the experience of a REALTOR® making all kinds of promises on what they will provide, only to have exactly the opposite occur in that after 2 months later the sign is falling down and they haven’t heard a thing. Advertisements are poorly written, a virtual tour hasn’t been created, a QR code hasn’t been utilized, showings are poorly managed and then when a change is required or an offer comes in, the REALTOR® ops to do it over the telephone or by email. If that is the kind of service experience home sellers receive; is it any wonder they look to alternative business models?

The RE/MAX organization has developed as the premium brand in Canadian real estate. We have done this over the years by attracting the best affiliates in the industry, with smart savvy marketing, with a value proposition that is the best in the real estate brokerage profession.

When Zoocasa and the Rogers empire starts up its PR campaign, understand they have an uphill battle to conquer. But they are a force to be reckoned with and one to be concerned about. We will prevail and succeed just as we have always done. But we can’t win if we become paralyzed by our fear. We have to rise above the 80 per cent of the licensed losers out there, by truly knowing our strengths and weaknesses.

Further to the consumer benefits, we have one other thing no one else can boast about; the customizable, full E-learning modules on My RU. Utilizing this tool will enable you to be even better prepared and educated than any other competitor out there.

The consumer is looking for a better way. And the good news is that we are that better way as we have always been. Our long history of building a positive reputation sets us apart. By being prepared, well rehearsed and articulate you will overcome any challenge that comes your way.

Really, in the end, it isn’t the change we are fearful of… what we are fearful of is how are we going to control the change and be prepared for it.

Set to work now to know what your true value is. Improve your presentation skills. Hone those basic salesmanship skills. Be prepared and rehearsed. Use and promote every service and tool we have. Walk into that appointment knowing all this, confident in your own ability to win that business.

If you do that, your personal long term success will be assured!

Elton Ash ABR CRES
Regional Executive Vice President

 

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NEWS HEADLINES

NEWS HEADLINES

Crash, Boom, Feast, Famine; headlines are designed to get your attention. The discerning consumer will take the time to read further. The intrigued consumer will take the time to read further and look beyond what is being stated; unfortunately both classes of readers are in the minority. The majority simply sees the headline, maybe read the first two sentences, then move on.

We can’t allow ourselves to do the same thing. When a sensationalistic headline concerning real estate sales activity or house pricing comes to our attention, our role as REALTORS® is to properly interpret that information then communicate the real meaning or story behind that news article to our customers and clients.

For example, in this morning’s online Financial Post there is a headline “Economic shock could knock Canadian housing prices down 44%, Moody’s warns”. The headline in itself immediately causes great concern with anyone who reads it. However, as you read the story, it actually refers to the pressure being put on all rating’s agencies to accurately predict what is going to happen to specific market segments in the economy. Further down in the story, “Ratings agencies came under harsh criticism in the aftermath of the financial crisis of 2008 for what was perceived as a failure to predict the U.S. housing market meltdown that precipitated it. Since then, there has been an attempt to strike a balance of thorough analysis with timely analysis, according to Grant Connor, an associate in equity research at National Bank Financial who previously worked on structured finance at Moody’s.”

Further it states, “At the simplest level, a stress case scenario should represent a realistic worst case scenario,” Mr. Connor said.” and “Moody’s Investors Service is in no way predicting the extent nor the causes of a large scale house price depreciation in Canada,” spokesperson Thomas Lemmon said in an emailed statement. “Along with many other factors, the home price component of our analysis provides that in order to achieve our highest rating, a mortgage pool would have to be able to withstand a 44% downturn.” Moody’s is the second ratings agency in as many weeks to seek input on a proposal to change the methodology used to analyze securities linked to mortgages.”

Then, at the very bottom of the news article, “In addition, Moody’s does not seem overly concerned about an over-supply of housing with the possible exception of the condominium market.”

You can see in the story itself, Moody’s isn’t predicting a house price crash of 44%. They are asking for input on developing a stress test to better able predict what a worst case scenario could be if specific predicted factors were to fall into place that would therefore affect the market.

In other words, politicians, regulators and business leaders are looking for ways to shift the blame or point the finger at anyone else if another financial crisis were to happen.

The fact of the matter is that all markets are cyclical. That will never change. We know that prices go up and prices go down. Over the world’s history, everything trends up in response to population growth and the resultant consumer demand.

We have lived through the greatest economic boom the world has ever experienced with the baby boomer demographic. It is purely natural and painful that following such a long run of growth, there will be a long run of economic instability. Up and down cycles are directly related to each other.

The thing is we have to see beyond the headlines of the particular cycle we are in. Back in the last up cycle, 1998 through to 2008 the headlines were all positive, nothing could go wrong. Now since 2008 the headlines are exactly the opposite. In our own situation as real estate brokers we have to appreciate two main philosophies when it comes to how we conduct business and control our own business lives.

1. We are in control of our own destinies, no one else. So ignore whatever the headlines are, be they good or bad. Stay focused on your own business track, providing the best service you can.

2. In regards to real estate investing, counsel your clients and customers to buy or sell their real estate investment, principle residence or other property, based on their own personal circumstances, not on the media perception of the day that they will make a quick buck or lose a buck.

If we stay with these basic fundamentals, we, and our clients, will ultimately succeed and enjoy a positive lifestyle.

 

 

Elton Ash, ABR CRES
Regional Executive Vice President
RE/MAX of Western Canada (1998), LLC

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HAPPY NEW YEAR!

HAPPY NEW YEAR!

Happy New Year!

Each New Year brings a renewed optimism for the coming year as we review our past year’s successes and challenges to determine our goals and targets for the upcoming year. Sales success is never really determined by outside market influences but by our own desire and discipline in creating and meeting our own personal goals.

Of course, a “hot” market may make it easier to reach a goal, but a so called “soft” market is not a barrier to reaching success. It really boils down to one’s own work ethic and ambition.

Top producing sales people typically go through a period retrospection as the year gets underway. This is natural, after a year full of activity, reaching to meet that year-end goal, to have it all start over again. This is short lived as the previous prospecting activities kick in with the telephone ringing and emails coming in requesting information.

My experience over the years has proven that a consistent prospecting plan always yields results. The key to take some of the sales swings out, with less cyclical influence, is to maintain a steady prospecting plan day in and day out.

Therefore, it is critical as you set your plans in place to always maintain a consistent prospecting plan no matter what else is going on in your business calendar. This will ensure you will experience consistent monthly sales performance, as opposed the lows and highs many others have due to inconsistent follow through on their plans.

As far as overall market conditions are concerned, 2013 looks as though it will be a stable year with record low interest rates remaining in place. There shouldn’t be any economic surprises ahead of us.

So, set your plans in place and follow them. You will reach your goals and have a great year in 2013!

 

 

Elton Ash ABR CRES
Regional Executive Vice President

 

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SUMMER MUSINGS

SUMMER MUSINGS

It has been a while since my last blog. A very busy spring has kept me away from the blogging keyboard. However, now that summer appears to have finally arrived, it seems like a good time to share some thoughts.

Media reports on market conditions across the country have been generally positive with many reporters asking about a bubble burst in the Vancouver market. My response has been that all indications are pointing to a slightly slowing market with balanced conditions. This will mean no bubble burst, just a leveling of activity.

The federal government’s move to reducing overall amortization rates and strengthening equity ratios on refinancing is good news for our industry. Canada has escaped the economic meltdown the rest of the world has experienced; certainly due to our more conservative nature and strong lending policies. I believe more importantly though, as Canadians we can be very proud of our work ethic, overall productivity and social responsibility. I believe that these factors are the foundation that has really stood us well during these trying times.

We have experienced strong Regional growth this year. Our net sales associate growth has remained very good with new franchise sales to match. At our Regional Strategic Planning session earlier this year we set our goal to reach 40% market share region wide in 2016. We shared this goal with the broker owners and office managers at the annual Broker Owner and Manager’s Retreat in early June.

In order to reach that goal we will be working with all our offices to continue to provide an exceptional sales associate experience; recruiting and retention has to be at the forefront of our thinking. We will also be targeting specific markets for additional franchises where we feel we have room for growth.

Over the years, we have witnessed how our growth, which produces more signs, more advertising, more Brand promotion results in greater income levels for all sales associates. Ultimately our goal is to continue to ensure our sales associates are the most productive and successful agents in the business.

To this end our mobile technology, incorporating “Live View”, Augmented Reality, is leading the entire real estate industry in providing the consumer with a unique search experience that will bring them back time and time again. Make sure you are promoting this tool to your clients, Link.

Finally, now that the hot weather is here in Western Canada, take time and enjoy some well deserved family vacation time. I know a busy fall season is headed our way.

 

 

 

 

Elton Ash ABR CRES

Regional Executive Vice President

RE/MAX of Western Canada (1998), LLC

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CREA AND TECHNOLOGY

CREA AND TECHNOLOGY

I just returned from a Franchisors meeting with the Senior CREA Leadership Team in Toronto. We had very good discussions about the Futures Project, the Data Distribution Facility (DDF), Federal Affairs, MLS® Home Price Index, the CREA Stats Boutique and the REALTORs® Care Foundation.

Generally the discussion was cordial with a fair amount of agreement on the topics, except for one thing, the future of realtor.ca! From my perspective, there is no question that realtor.ca and the precursor, mls.ca, served a critical role in our technological development in the Canadian real estate industry. Today it may be a different situation; it seems to me one of the biggest issues the Competition Bureau has with organized real estate is realtor.ca and the closed environment around it.

In response to the rapidly changing brokerage environment, CREA initiated the Futures Project. This is a tremendous initiative that CREA should receive full accolades for. There has been a tremendous amount of work, effort and time go into this at all levels of membership. Certainly the upcoming AGM in Ottawa will be ground breaking as the entire project is discussed and decisions are made on our Industry’s future.

One of the ideas to be discussed will be for CREA to look at developing a business model around spinning off realtor.ca to a third party to manage. The reasoning being to provide better management and control over the product and develop a better customer/consumer experience. It could even be developed to accept FSBOs and become the ultimate web site for consumer search for real estate.

This was the one idea all the Franchisors had an issue with; never ever even contemplate such a move. If this is a way to please the Competition Bureau, then shut realtor.ca down completely. Never allow FSBOs any opportunity to advertise their own home on a REALTOR® site. Further, why have an Industry site that is really competing with our own consumer listing search sites?

From our RE/MAX perspective we have worked very hard with a tremendous investment to develop a listing site that has become very successful. We will continue to develop remax.ca and Leadstreet to be the best tool for both consumers and sales associates. Many would agree that today, realtor.ca only exists to level the playing field and take away the competitive advantage we have. And today, I would believe that.

I believe the Data Distribution Facility will be a great resource and tool for all REALTORS® to use and take advantage of to display listing information on an individual licensee basis, on a brokerage site, on regional or national Franchisor sites. I no longer believe that Canadian organized real estate needs a consumer oriented web site to search for property. Through IDX data sharing agreements and Broker Reciprocity any single entity or organization has the ability today to display all the mls home listings available in those particular markets. This then leaves it up to the Franchise organization, the brokerage or the individual to develop and compete for their share of the market. And most importantly, allow each of us to truly compete and win in attracting the greatest amount of business.

The upcoming AGM in Ottawa, March 24th and 25th, will be one of the most important ever. Take the time to review the entire Futures Project. It really is a well executed document with some very valuable insights as to where our industry needs to go. Make sure your Real Estate Board of Directors is aware of your thoughts and concerns before they head to Ottawa to express them for you.

I look forward to hearing from you on this topic.

Elton Ash ABR CRES
Regional Executive Vice President

RE/MAX of Western Canada (1998), LLC

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RETURN ON INVESTMENT & A GREAT TIME?

RETURN ON INVESTMENT & A GREAT TIME?

The Quebec conference has come and gone and we are all back to our day to day activities. The feedback I have received to date was that the overall conference was one of the best ever; the content and entertainment fabulous and interesting.

Ken Schmidt’s story about the Harley Davidson’s history and business model was inspiring and interesting. The Global Panel made up of Vinnie Tracey, Walter Schneider and Alan Tenant addressed some key issues in our industry and brand. The breakout sessions were well attended with a lot of ideas being exchanged.

Amber Mac’s social media presentation was exceptional as she really brought a greater understanding of how to maximize the benefits of this new world. And how could anyone not laugh with Derwood Fincher’s hilarious take on Candid Camera.

Finishing off the weekend with the Cube performers during dinner and then dancing to Alter Ego really capped it all off.
The greatest benefit of the conference for me was in renewing old friendships and meeting new people. This included networking and learning how we as your Franchisor can continue to build on our overall Brand strategy to assist you in being successful.

I look forward to hearing your comments on what inspired you or what you really appreciated and enjoyed at the Quebec Conference?

 

 

 

 

 

Elton Ash ABR CRES
Regional Executive Vice President

 

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