Monday, June 7, 2010

Innovative real estate?

I have been thinking a lot lately about joining forces with a few brokers in other states and sharing my knowledge of alternative lending resources with them and their clients. I was not sure how to approach this so I Googled innovative real estate brokerage and was taken to a craigslist ad advertising a brokerage to agents. This brokerage talked about it's amazing level of innovation and how they adapted to this economy and how they are now booming in business. So I reached out and gave them a call.
In speaking with their founder and CEO I was given a good lesson on his history. He had come from a technology background and was consulting large real estate firms on Internet marketing when he started as an agent in 2006. His numbers were quite impressive with nearly 14 million in sales that year and almost 60 million the next. He was a top agent and in late 2007 started his own brokerage. Then the story changed. "The economy did this and the economy did that" was pretty much the gist of the remainder of his history. From there he decided to close all the offices and go virtual. He created a software system to make his office virtual, complete with avatars and 3D movement, astounding! But how in the heck does that change anything??? Does your system change the economy because that seemed to be your problem in the first place according to your story.
I think there is a general consensus that most of us were at the top of our game in 2006-2007. What people fail to realize is that it is not the economy that hurts us, it is the economy that exposed our weaknesses. Maybe that weakness was depending on it always being a seller's market. Maybe the weakness was depending on the availability of credit to buyers. In either case there have been weaknesses and a little preparation and diversification will be the most innovative step anyone could take right now.
So here is my suggestion to those that want to become the most innovative agent/broker of your time. Do something that fixes a problem. Most successful entrepreneurs will tell that problems create opportunities. For instance, why don't you create a private social network for clients that want to invest in REO. You could advertise this member only network on free sites or within your blog and have a self run captive audience of buyers and sellers just waiting for you to tell them what to do. I personally created such a site 2 weeks ago and advertised it on craigslist. As of this morning I have 44 members and potential clients. I have never met any of them and better yet I paid less than $100 to build the site which took me 3 hours. Here's another one... Pay a consultant a portion of your commission to find alternative forms of financing for your buyers that cannot get approved. What most agents do not realize is that there are alternatives to banks and mortgage brokers. The reason you do not know about those alternatives is because banks and brokers are the only ones marketing themselves. Government direct loans and not for profit entities usually do not have a sales department attending breakfasts with real estate agents. You have to seek them!
In the end technology has most likely contributed to the most innovative changes to date in the real estate industry but if you are looking to be innovative start thinking like a real business and do something that brings prosperity by solving the money problem first.

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