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Investor, Home Buyer in Suisun City, CA

New agent wishing to enter the luxury home market.

Asked by Investor, Suisun City, CA Sat May 10, 2014

I am starting out as a new agent, and I would like to enter the luxury home market both as a listing agent and a buyer's agent. I have a few questions about this market. Is there a decent chance of success for a new agent penetrating this market and acquiring a luxury million plus home listing, with the right marketing and effort? Or is it really a matter of joining seasoned agents that are already in the market? Has anyone had an issue with their broker not allowing new or inexperienced agents to work on acquiring larger listings and directing that business toward seasoned, top producers in the brokerage? I've heard rumors to this effect, but I want to ask whether this is the reality or not. In the end, I want to make sure that I am successful and that I have the best chances for success. At the same time, I am very interested in running my own business and reaping the rewards from my entrepreneurship.

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18
Investor’s answer
My sincere gratitude and admiration to all of you for the wonderful responses that you all have given me here. I really feel motivated, encouraged and excited now as I embark on this new career path. Best wishes for success to all of you!
0 votes Thank Flag Link Mon May 12, 2014
People with money don't get there by accident. They are pretty smart. While it's true that people will very often choose their agent not based on logic, statistics, or past record of performance and do business with people they know and like - it's also likely that someone who has a $1M+ property isn't going to do SOME research on the agent they hire.

I think positive and there are enough stories of agents getting listings or sales from people they would never expect (the old smelly man who looks like the bum who lives under the bridge but was really an undercover millionaire who bought the most expensive property in two, etc) - I think we also have to be brutally honest with ourselves. So here goes...

Do you think that sitting in front of a seller with Zero, One, or Two closed transaction under your belt will make more difficult or less difficult to get the listing?

If you guessed "more difficult" - you'd be right. And since you've not gotten a listing yet, you don't have an idea of how difficult getting a $750,000 listing is in order to be able to do a "more difficult" comparison to in order to visualize how difficult it is to get a $1M+ listing.

Here's what I would do if I were you.

1) I'd find that part of town which has a greater proportion of luxury homes. Focus your efforts there. Start focused farming. A lot of listings/sales you complete in that area might not be considered "luxury" but they probably are not trashed out beaters that only the most adventurous investor would want either.

2) Build Your List of Your "Top 100" - pick out 100 "luxury" homes in this part of town that you'd like to list or sell.

3) Do your Just Listed/Just Sold Cards (Property) - whenever you take a listing or sell one, send out a round of Just Listed/Just Sold homes and call the people around the house. Use a Mike Ferry script or something. Try to get MORE listings from the one you got.

4) Do Just Sold "Power" Mailers - whenever you sell a home, get a testimonial from your client. WRITE IT FOR THEM! Write it the way you think THEY would want to write it. Talk yourself up in it and reference obstacles your overcame together during the course of the sale. After closing docs are signed, ask them to review it. If they are excited and say anything like, "That's EXACTLY how I feel about working with you!" then ask them to sign with a Flair Blue Felt-Tip Pen and then sign a statement that authorizes you to use the testimonial in your marketing efforts.

Contact a wedding Calligrapher and have them do up 100 envelopes in Spencerian Script to your Top 100. Black or Red envelopes with white ink really make an impression. Round return address labels with YOUR address (not office address) should go on the back to seal the envelope closed.

5) Mail the Power Mailers - pop scanned, color copies of the testimonials into the fancy envelopes and mail them out.

Do this every time you sell a house. Your stuff WILL get opened by you Top 100 and becuase most of your business comes from withing their own town they will develop an affinity to do business with you. In the mean time, you're probably making bank AND gaining experience.

Double down with door knocking and other things and you're sure to get some luxury homes signed up and from there you can use them as "proof" to get other luxury listings. You're off to the races.
6 votes Thank Flag Link Sun May 11, 2014
Great advice. I'm really needing to move up to higher-priced listings and your suggestions are greatly appreciated.
Flag Tue May 13, 2014
Investor,
You can have whatever buyers or sellers you bring to the business. The office you work for won't (shouldn't) control anything to do with this with the possible exception of floor time or office calls. Very little of our actual business comes from this and a broker would be doing their job to put that rare client with the most capable agent in their office.
If you hang out with luxury owners, join their clubs, participate in events where you are exposed to them, then you may get their business. The business goes to the people who know the people looking for the services provided.
I would spend your early career focusing on developing your knowledge and skills. If you are in business in two years, you'll be ahead of most agents who get their licenses when you do. Learn the basics and develop your own clientele.
3 votes Thank Flag Link Sun May 11, 2014
Hi neighbor (I'm in Cordelia, my main office is in Palo Alto). In California, brokers technically cannot assign agents to specific territories or market segments due to their status as independent contractors. That doesn't mean brokers don't encourage agents - especially new agents - to pursue the type of business they feel an agent is best suited for. And certainly many brokers hand out broker-generated leads to agents they feel have the best chance to close the deal, not to the "next agent on the roster." And absolutely there are brokerages where the broker has a core group of seasoned agents they funnel leads to while everyone else is left to fend for themselves. But that's the nature of this business. Whether you work in an office or you're an independent broker, your success or failure comes down to how you generate your own leads and manage your business.
Many brokers steer new agents away from the luxury market because it's so small and homes in the luxury price range move so slowly (local example: the most expensive single family listing in our area, 4286 Suisun Valley Road, is listed at $18M and as of this morning has been on the market 1,430 days). In my never humble opinion, experience in real estate is not measured in years, it's measured by the transactions an agent has under their belt. An agent who closes 50 transactions in one year has 10 times the experience as an agent who closes 5 transaction in a year. Stay in real estate long enough and you'll meet several agents who have 5 years of meaningful real estate experience spread over a 15 year career (and their skill level reflects it). Brokers want new agents to get a lot of transaction experience fast, so they'll usually encourage agents to work within the price range where most of the activity is taking place. But the market segment you pursue is yours to choose.
2 votes Thank Flag Link Sun May 11, 2014
Yes, (depends on your correct definition of the luxury market), NO, and NO.

You need to succeed in two things.
1. Getting an audience with these owners.Most resources available to newbies does not work in this market segment.
2. Making clear why they should trust a 'newbie' with such a valuable asset.

Knowing the collateral through which you have the opportunity to work will prove essential.
2 votes Thank Flag Link Sun May 11, 2014
Dan has shed some important insight regarding your question.
In the Tampa Bay area of Florida, luxury is identified as those homes priced over $800,000. In your part of California, that may be defined as a starter. Find out what defines luxury in your market.

As Dan reveal, these buyers and sellers are responsive to 'authority' influences.
And they will always ask you to present your credentials. When you have empty pockets of success, you will need a back up plan. They exist, but you will need to be prepared.

These folks seldom trade in the 'TRUST ME' currency.
1 vote Thank Flag Link Mon May 12, 2014
Congratulations! And welcome to the real estate industry. You have a great attitude and it sounds like you are motivated. I'm sure you will be successful. You can definitely get clients in your market, but it's important to be patient and understand that it could take some time before you are able to establish a successful business. And, you will also get lucky with some new clients as well. Don't get caught up in the rumors, just focus on working hard and running a good honest business. I doesn't hurt in the beginning to try to connect with more seasoned agents to see if they will forward you leads that they don't want to work, and to shadow them on listing and showing appointments. Also, try to be in the office a lot so you can hear about what issues other agents are dealing with, and see how they handle their business. Best of luck to you!
1 vote Thank Flag Link Sun May 11, 2014
Congrats to you first off on getting licensed!

I am also new to the market place, and to my area, mode here from SoCal. Yes anyone can get luxury listings if your in the right place at the right time or know the right people. If your broker is telling you no, I'd ask why? If they are saying due to inexperience then listen and get some experience selling, renting (same type of process just faster, less paper work, no banks involved and less money- but it pays the bills) or find a seasoned agent that will let you work with them and thats honest!

Some times we have to make baby steps first to learn how to run.... if your broker won't help you get where you need to be then look for another place to work. I did and interview process with loads of questions for them before I settled in where I am today and happy I did! Good luck!!
1 vote Thank Flag Link Sun May 11, 2014
You can deal with whatever properties are for sale or whatever properties will entertain you as a listing Broker. I suggest you team up with a more experienced agent to help you learn the ropes and get your name around many people do this to get started.
Good luck.
1 vote Thank Flag Link Sun May 11, 2014
Your broker can't and shouldn't dictate to you where to invest your efforts. One of my favorite sayings is aim for the moon and if you miss, you'll land among the stars. My second listing in my community was a $550,000 listing (we have only a handful of million dollar listings in our area) so this was a BIG deal. Today I handle many of the "luxury" listings in my area but I never turn down what I consider to be the bread and butter of my business. Real Estate is all about getting name recognition and as such it is a numbers game. Focus on growing your business and the rest will follow. Best of luck.
1 vote Thank Flag Link Sun May 11, 2014
The beauty of real estate is that the sky's the limit and you can create your own business. What you create has little to do with your brokerage.

That said, it sounds like you are trying to go from zero to 100 miles an hour rather quickly. As a new agent there is a steep learning curve. You need to learn your markets, real estate laws, transaction paperwork, inventory, and so much more.

You might want to find a luxury agent that will mentor you into their business. Perhaps start as a buyer's agent for a big name agent and work your way up. Just a thought.

Best of luck.
1 vote Thank Flag Link Sun May 11, 2014
Breaking into the "Luxury Home" market can be rewarding but is generally the result of agents investing time and patience, working their way up to eventual success. Managers and brokers will normally be more encouraging of agents entering this market when they feel the agent has enough experience to warrant this initiative.

The Luxury Home market is a different real estate undertaking that requires an expertise that includes knowing this market, understanding the needs these buyers and sellers, an in the trenches working appreciation for marketing this product, and usually a commitment to investing a larger amount of personal time and money to do business.

This is a good example of the need for agents to start at the bottom and work their way up as opposed to starting at the top......

Probably the best way to break into this market sector is to do so based on your own initiative. This means targeting your own luxury listings and customers when you are ready. Waiting until your broker/manager starts feeding you with these leads will likely never come...that is until you have proven yourself and gotten their attention.

My advice is to start small but think BIG, knowing that you will eventually get there. There's a lot to learn in this business.....consider beginning with "little steps...."

Best wishes,

Bill
1 vote Thank Flag Link Sun May 11, 2014
First, you must pick a location and start with a small quadrant of luxury homes that is nearby.

Second, you must find your niche and sales strategy. What do you represent? and what makes listing or purchasing with you different?

Finally, in addition to your traditional marketing strategies, such as mailers, door knocking, and now the new modern way of marketing, such as on-line marketing, websites, and on-line lead generation, I would join a local organization or charity and get actively involved within your community. Getting to know your community leaders and going out and shaking hands with your local business owners and neighbors is more personal and impressionable than a post card or your on-line profile. However, if you have the cumulative affect of all 3 strategies (Traditional, On-Line, and Local), now you are not just marketing yourself, but branding yourself in a particular area - which is exactly what you need to do to enter the luxury market.
0 votes Thank Flag Link Mon May 4, 2015
Asked another agent in your office who is in the luxury market, if you can do open houses for him or her. Most agents will be glad you're willing to do this.You might pick up your first client this way.
0 votes Thank Flag Link Sat May 2, 2015
In most offices you have to do your own marketing and the broker will not interfere whether you are marketing to luxury home owners or first time buyers. However most home sellers will list with someone who was recommended to them or someone who has sold a lot in the area or a relative. You can market to your sphere of influence first to get any listings. Or you can team up with an experienced agent and learn and help the agent . The others have already given you good advice.
0 votes Thank Flag Link Sat May 2, 2015
I would recommend associating yourself with this "higher class". Be seen, in public, in areas where these homeowners spend their free time. Consistently market to them - Flyers/Postcards/Just Solds/New Listings, etc. It'll be important to get one or two listings/sales that you can use to impress and earn the initial name recognition and respect from these targeted homeowners.
0 votes Thank Flag Link Wed Apr 29, 2015
Actually, I think it's more a matter of having the right kind of business and personal contacts. It's not something that can just "happen" for you unless you have a way of getting to know clients in the luxury market. I worked for many years in a luxury(Beverly Hills) area and have 24 years worth of contacts from that. If I were just starting, I think the best thing you could do is work under a Realtor who has experience in luxury property and stick there for at least (5) years so that you can also develop similar relationships.
0 votes Thank Flag Link Sun Apr 26, 2015
It has been my experience that succeeding in the high end requires either 1) a truly robust COI & past-client database or 2) assertive prospecting & ground-pounding.
Last year I signed up with a NC company called "Luxury Listing Group" . Basically, they assign a salesperson to call all the expired's, just listed, just solds on my behalf so I do not have to.

It has been a wonderful experience with all the listing appointments being qualified. If you don't want to call yourself this may be a good resource.

Best of luck!
0 votes Thank Flag Link Thu Apr 23, 2015
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