Before I get into why a real estate sales background is crucial to becoming a successful buyers’ agent or, as I prefer, a buyers’ advocate, I’d like to run through what a buyers’ advocate does.
Key differences between sales and advocacy
A buyers’ advocate is working for the buyer to get them their best deal and help them along the journey to achieve their financial and life goals. The process of being a buyers’ advocate is very different from being a sales agent.
The approach you take with each client is more consultative and you need to factor in many more parameters than simply achieving a fair purchase price. For investors, you’re looking at your client’s risk profile, considering multiple wealth creation strategies, researching the market, liaising with other property professionals and more. For homebuyers, you are refining their home-buying brief against their budget, researching the market, liaising with other property professionals and much more.
Buyers’ advocacy is a process, not a transaction, and it’s time-consuming.
An understanding of sales commissions and structures
To be able to help clients achieve their property investment or ownership goals, we need a firm grasp of how real estate agencies work, the real estate sales model, and how individual agents get remunerated. It’s critical that we understand who gets paid what, as that affects our approach to purchases and how we negotiate on behalf of our clients.
Experience in a competitive sales environment
The culture of real estate agencies can sometimes be dog-eat-dog and highly competitive. Real estate agents are trained to talk up a property; they can make what is essentially a property ‘lemon’ appear to be a solid asset with good capital growth and/or yield prospects. That’s their job. The problem is that although the property might be cheap, a lemon is a lemon and anyone who buys one will have problems when they want to sell.
Our role as buyers’ advocates is to protect property buyers and to do that, we need to understand what we’re up against.
Real estate skills that are second to none
Clients who engage a buyers’ advocate are paying us for our insights and insider knowledge of the industry. Our clients may have been ripped off before, or been pressured into making unwise choices.
When we have practical, on-the-ground real estate experience, we can use our real estate skills to help our clients make the best choices for their risk profile, and their wealth creation or lifestyle goals. With first-hand property experience, we can meet sales agents head-on – fully aware of the sales tactics they’ve learned (that you probably learned too) and see through the fantasy sales talk.
On the flip side, sales agents say they prefer dealing with experienced buyers’ agents over the inexperienced general public, as the property transaction can be completed in a professional and timely manner. Less time is required by them to educate the buyer, as we do that, and buyer emotions (and stress) are more effectively managed.
People joining from outside the industry
Conversations I’ve had with solo franchisees wanting to join me, under the Property Mavens brand, indicates that there are individuals with no real estate experience seeing the role of a buyers’ agent as an attractive way to earn ‘easy’ money and gain property experience.
The problem is that a real estate licence alone doesn’t get you the level of property market experience you’ll need to be an effective buyers’ agent or advocate. A better place to start is in real estate sales; then, with a minimum of two years of live mentoring and selling experience, you could consider changing sides.
Experience with the market and financial acumen is vital to the role of a buyers’ agent and property advocate. Without a solid property background and the ability to assess properties on their merits and potential, it’s neither safe nor prudent to advise clients without calling in a property expert. The advice you give and decisions you help your client make will be life-changing decisions. Mistakes can be costly, especially if you’re offering investment advice without a licence.
Hence it’s important that you have not only the right qualifications, but also, real-life experience to ensure you’re able to arrive at the best outcome for your clients.
What types of property decisions do buyers’ advocates help with?
Buyer advocacy can’t be learnt in a six-week course. It takes years to gain the depth of knowledge you need to be truly successful and worth the fees your clients will pay you.
It’s only through a combination of on-the-job training, certification and mentored time in the market that will give you enough experience to advise on the following for your client, and more. The types of decisions we help our clients make include:
- Choosing and buying a financially sound investment property.
- Securing the right home and lifestyle, allowing for practical living expenses.
- Using your property knowledge to negotiate a fairer buy price.
- Assessing a client’s property portfolio for capital growth and rental returns.
- Renovating for growth in a home or investment property.
Education, advice and guidance
At times, the advice we offer clients might feel a little harsh but our role as a buyers’ advocate is to remove the emotion and be firm in guiding clients about potential purchases. We might have a client who has their heart set on a particular property but it isn’t the property they can afford or need to buy to achieve their life goals. It’s our job to educate our clients and guide them to making the right choices.
As buyers’ advocates, we offer advice and counsel. We’re helping clients make property decisions that will have a huge impact on their financial future. Think about it: the wrong advice could end up ruining someone’s life. Prior real estate sales experience is, therefore, essential as it will minimise the chances of a client wanting to sue you.
If you think you could make it in the buyer or vendor advocacy world, please get in touch. More members make for a much larger collective property advocacy brains-trust.