Referrals can be a big part of a real estate agents business. And referrals from past clients, friends, and family are even better. A referral from a past client provides some of the best gratification for a real estate agent letting them know they did a good job with the past client.
But this article is not referrals from these sources. This article is about referrals from outside sources…usually other real estate agents. Real Estate agents receiving and sending referrals to and from other agents is in some cases a part of every day business. In a perfect scenario…the referring agent knows the client, either professionally or personally, and is referring them to an agent who may be better equipped to assist the client or perhaps to a state or region where the referring agent is not licensed to do business. In return, there is usually some sort of agreed “referral fee” connected with the acceptance of a referral.
For example. I am licensed in Virginia and Maryland. But lets say an agent from Kansas is selling a home for their seller who is moving to Virginia. That agent could call me and refer their seller to me (for a fee) to help their client find a place in Virginia. In that instance…the referring agent has direct and intimate knowledge of the client and has made direct contact with me…maybe even “pre-interviewing” me. This is how the “agent to agent” referrals should work.
With the growing use of the internet…a new hurdle has developed. The “random referral”. It can happen with a buyer or a seller. The customer goes on say Google (or any other search engine) or a real estate website that is not MLS based (Zillow, for example)…they put their real estate query in the box. Let’s say “How much is my home worth”, “Real estate agents on Chincoteague Island, Va.”, or “Houses in Ocean City, MD”. The search brings up several websites or results. At this point…the site wants the customer to enter the information about the query. For example, the address of the house they want to sell, the area they want to buy in or something similar. Also, the site want the customers contact information.
So here is where it derails. The site tells the customer that someone will be in contact with them. The site (which could be based on the opposite side of the country or even out of the country then automatically emails one or more real estate agents who may or may not be an expert in the area in question and tells the agent that the is a customer who needs assistance and for a fee, the agent can have the contact information. Which the real estate agent has the choice of saying yes or no. So one might say…”so what? How does that affect me?”. And here lies the answer.
First the experience issue. An inexperienced agent can get this referral just as easily as an experienced agent could. The customer may get an agent who knows nothing about the town or area in question and will give the customer inaccurate information and answers. The second issue is the financial issue. The referral affects the bottomline on what the firm or agent will receive in commission. Which may affect the service received. This of course would never be an issue with our firm, Dockside Properties, that offers OUTSTANDING service regardless of the commission received. 🙂
There are other issues in the mix, but you likely get the idea. The sad thing about this is the most of the buyers or sellers entering this information online have no idea that this referral process is going on in the background and in many cases…were planning to call the same real estate agent “when they were ready” to take the next step. In some cases…the customer may have been a past client of the agent and just wanted to get a ball park on price without bothering the agent yet. But once the agent accepts this referral…it is difficult to “get out” of the referral.
So here comes the moral of the story. If your considering selling or buying a home in the area…don’t go on a random website and try to find out what your home is worth or what homes are in your price range. And even if a site is more well known…like Zillow, you are still not getting accurate information. That pesky “Zestamate” is never right (when your done here…go read my blog about Zillow.) And even though this article is not about social media…that isn’t the best source either. Social Media tends to only offer up individuals who usually less experienced…sometimes even agents who offer kickbacks for the number of times a person mentions their name….and you probably don’t want the agent who pays for the referrals. You want a Realtor who is experienced and active in the area that you are looking at. The best thing for you to do is to call a Realtor in the area you want to do business. Ask them for information about them, their business practices, and their results. Then both you and the Realtor will have some rapport and you will have a more solid and successful relationship.
With that being said…if you are interested in buying or selling on Virginia or Maryland’s Eastern Shore. Give me a call at 757-894-1479 or online firstname.lastname@example.org .
Thank you for reading.