Public perception of real estate agents
Exotic summer vacations, elegant dining experiences, high-performance European cars, custom-tailored Italian suits, luxury handbags worth five to six figures – these are often the images that some members of the public associate with real estate salespeople. It's a perception that might still linger. However, the term "profit" seems to carry a negative connotation in New Zealand, only celebrated in the context of sporting achievements. I agree that our industry doesn't enjoy the best reputation when it comes to financial matters.
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For the record, I have a fondness for European cars, although I don't currently own one. When I spot a Range Rover, I find myself asking my wife if we should consider purchasing one, especially since our accountant has suggested it for potential tax benefits. A word of advice – while there are exceptions, many accountants lack imagination. Speaking from my past experience as an accountant, I feel entitled to jest about the profession. It bewilders me why people often seek business advice from accountants.
The main idea I'm aiming to convey is whether real estate agents truly deserve substantial compensation. And if they do, why is our industry met with such scepticism?
Imagine a young, talented, and ambitious salesperson entering the industry in their mid-20s – a trend becoming more prevalent these days. Thankfully, the trend is shifting towards valuing vitality over experience, much to the chagrin of my colleagues Jojo, Jo, and Wendy.
Envision this individual working relentlessly for a year or so, finally gaining traction. With their hard-earned commission, they decide to use it as a deposit for their first European car, financed. The rationale behind this decision is to maintain a certain "brand image" as their clients expect them to exude success. Having spent the bulk of their commission, the cycle repeats as they dive back into securing more sales. This time around, they reinvest their newfound earnings in tailored suits, exotic vacations, and business-class travel. Their accomplishments are well-deserved, and the pattern continues. Their circle of friends applauds their achievements on social media, acknowledging their success.
I believe people's dissatisfaction with real estate agents doesn't primarily stem from the commissions we earn. Rather, it's the stereotypical salesperson described above that elicits scepticism. Instead of squandering initial capital on depreciating indulgences, why not allocate it to marketing efforts? By marketing, I'm not implying presenting oneself as a New York agent handling million-dollar listings. What if some of the earnings were directed towards growth, like hiring a personal assistant or investing in personal development?
Regrettably, most salespeople haven't been educated on reinvesting their earnings back into their business. Making matters worse, some real estate office proprietors actually encourage their staff to follow such patterns, seeing it as an effective way to motivate salespeople.