Real Estate Business crunches the key numbers from this year’s Top 100 Agents ranking and speaks to industry leaders to find out what separates elite from non-elite agents.
Some of the industry’s top performers have good news: it’s possible for every agent to qualify for the Top 100 Agents ranking if they’re prepared to follow the right system. And, no, that doesn’t mean having to become a workaholic.
John McGrath, chief executive of McGrath Estate Agents, is one person who believes everyone is capable of being a high-performing agent. Yes, some people are born with greater sales skills than others, but real estate professionals are capable of making big improvements if they have the discipline to stick to the right methods, he says.
“I’ve seen many agents who have out-listed and outsold all their competitors, yet who have far less talent,” he tells Real Estate Business.
I've seen many an agent who has out-listed and outsold all their competitors and yet have far less talent
“They’re normally better organised than the more naturally gifted. They’re more focused on the clients’ needs: they don’t wing it; they prepare and research. So even if you’re not as naturally gifted as others, there are things you can develop that will still win you the business most times.”
Prominent real estate coach Michael Sheargold also believes everyone has the potential to crack the Top 100 Agents ranking. He describes real estate as the perfect meritocracy – in his experience, everyone is capable of excellence, no matter their height, weight, background, lifestyle or education.
“If someone is committed to making it happen and they’re prepared to surround themselves with people to support that particular journey, it will happen,” Mr Sheargold says. In other words, dumb luck has nothing to do with it.
ACTON Cottesloe director Bev Heymans, who placed 47th on this year’s Top 100 Agents ranking, is proof that elite agents make their own luck. She moved from South Africa to Perth, which meant she had a limited number of relationships to call on when she started in real estate a decade ago. She didn’t win a single listing for her first nine months. One particularly bleak moment involved a close friend: Ms Heymans was sure she would get the job, only for the friend to call her and announce that she had decided to use another agent. Ms Heymans wished her friend all the best, hung up the phone – then burst into tears.
She resisted the temptation to quit. Instead, she fought through the rejection and ultimately starting picking up listings and sales.
“I think people give up too soon and they don’t do the hard things,” Ms Heymans says. “When it’s hard and unpleasant they can steer away from doing those tasks, because it’s not pleasant to get rejection.”
Like Mr McGrath and Mr Sheargold, she believes everyone is capable of reaching elite status as long as they’re prepared to follow proven systems.
“Some of the best agents I’ve met are the ones who aren’t that bright,” Ms Heymans says. “They don’t think that much, so they just do what they’re told, whereas agents who are more intelligent might find reasons why something isn’t going to work for them.
“To get to the levels of a James Tostevin [who placed first on the Top 100 Agents ranking] you have to be an exceptional person. That takes a skill beyond what a lot of people have. But to be just a good top agent, you have to have systems, you have to have processes and you must have motivation.”
“Most agents waste more than half their day”
If everybody is capable of becoming an elite agent – what then? Does that mean success comes down to nothing more than hard work? Are the top 100 just the hardest-working men and women in the industry?
The short answer is, no. There is no automatic link between the number of hours an agent works and the number of sales they make. All things being equal, more work will trump less work – but all things are rarely equal. Mr McGrath says agents need to work hard if they want to become elite, while stressing that working hard and being a workaholic are two different things.
“Most people who are at the top of our industry and our company probably do 50 to 60 hours per week,” he says. “They recognise that balance is important. They recognise that family and looking after other things in your life outside real estate makes you a far more interesting and authentic person. They recognise the importance of having time off and relaxing.”
Clarke & Humel principal Michael Clarke, who placed seventh on this year’s Top 100 Agents ranking, says the key is not so much working hard as working smart. He speaks from experience: his performance dramatically improved when his wife identified the “organised chaos” of his work routine and systemised his business.
“You can work your bum off, but if you’re working your bum off in the wrong direction all you’re doing is expending a lot of effort in an area that isn’t going to move you forward,” he says.
You can work your bum off, but if you’re working your bum off in the wrong direction, all you’re doing is expending a lot of effort in an area that isn’t going to move you forward
Ray White’s leader of elite development, Julie Ryan, says the top agents she works with get maximum value from their time. They don’t need to be workaholics because they’re so productive.
“Most agents waste more than half of their day,” Ms Ryan says. “Being focused on not wasting even a couple of minutes is a hallmark of someone who is going to achieve very strongly.”
This is what success looks like
A picture of a top 100 agent has started to emerge. They’re ultra-productive. They follow systems. They work smart. But what else?
The numbers fill in many of the gaps. The profile of the average top 100 agent reveals that they’re 41.5 years old, have 15.6 years’ experience, employ two support staff and charge a commission of 1.92 per cent. Last year, they sold 86.1 properties valued at $1.47 million each with a conversion rate of 90 per cent and a time on market of 31 days.
When asked to name their biggest challenges, 18 per cent said time management, 17 per cent said maintaining their commissions in the face of undercutting by rivals, 12 per cent said managing a changing business structure, 11 per cent said managing vendor expectations on price, 9 per cent said staff management, 8 per cent said finding listings and 7 per cent said balancing work with other commitments.
Top 100 agents, it can be seen, face the same challenges as every other real estate professional. That reinforces Mr Sheargold’s earlier point: elite agents don’t succeed because they miraculously avoid challenges; they succeed because they create systems and processes to overcome those challenges.
What elite agents get right
One of the traits of elite agents is that they regard themselves as entrepreneurs rather than employees, according to Mr Sheargold. That means they show initiative rather than wait for everything to be handed to them. A good example is education: elite agents proactively seek out new learning opportunities, while lesser agents wait for the boss to book them into a course.
“There’s no one in the Top 100 Agents list who hasn’t invested significant time and dollars into improving themselves,” Mr Sheargold says. “The elite see themselves as operating a business within a business. They’re not running with an employee mindset that real estate is a job. They see real estate as a profession and as a business.”
Another thing that separates elite agents from lesser agents is their clear market position, he says. They don’t try to be all things to all people. Instead, they find a niche in which to operate. That allows them to portray themselves as specialists and differentiate themselves from rivals.
In Mr McGrath’s experience, elite agents are “generally the best people-connectors I’ve come across”. They’ve worked hard to master the art of sales, which depends on building rapport and generating trust. “You need to have a base platform of focus and product knowledge, but on top of that it comes back to your ability to connect with people.”
But how do you get in front of the client in the first place? The answer is to constantly work on building a local profile, according to Mr McGrath. That can involve database marketing, sponsoring local events and establishing relationships with key local influencers such as bank managers and accountants. “They need to perceive that you’re the best at what you do, but they also need to meet you to make that decision.”
Ms Ryan from Ray White says elite agents recognise that it is now the consumers who are in charge, not them. Before the internet, agents acted as gatekeepers to market information. Now, not only are listings and sales histories and property data easily accessible, but consumers can also influence agents’ reputations through social media posts or online reviews.
As a result, elite agents are very responsive to consumers’ needs, Ms Ryan says. That means not only responding rapidly to queries, but also providing informative answers.
Another reason elite agents reach the top is that they constantly strive for self-improvement. That’s the opinion of Ms Heymans from ACTON Cottesloe, who doesn’t take her top 100 status for granted.
“I find the market is changing so rapidly,” she says. “That strategy and dialogue that worked a month ago might not be relevant today. We do ongoing training and role-playing all the time to be aware of what’s working and what isn’t. Our responsibility is to the vendor, so we have to make sure we’re on top of our game and know what will impact a buyer.”
Ms Heymans makes a point of reading a real estate manual or listening to an audio guide every day. She does formal training once a week, receives visits from external trainers about once per quarter and also attends conferences. She says every one of these sessions improves her performances. “Sometimes, it’s something you just have to hear again – it doesn’t have to be new, you just need a reminder that you have to be doing it.”
What non-elite agents get wrong
It’s often said that hiring an assistant is an essential step on the road to becoming an elite agent. However, as Mr Clarke from Clarke & Humel points out, delegating work can actually detract from an agent’s performance if not handled correctly.
“One of the major ways where a real estate agent goes wrong is they decide that all they’re supposed to be doing is listing, selling and negotiating, so everything else should be farmed out to their assistant – but then they do no work with the assistant [to make sure] they understand how the assistant is going to shelter the agent from all the other stuff,” he says.
Mr Clarke believes it’s a big mistake for people to think they can be disorganised and write high volumes. He also believes that assistants amplify their boss’ behaviour. “If you’re a disorganised mess, then you’ll have a team of disorganised mess. If you’re organised, systematic and productive, then you can have by extension an organised, systematic and productive team that allows you to take more work on board.”
Mr Sheargold points out that lack of self-belief is another thing that stops people becoming elite agents. He says everyone is capable of becoming a top 100 agent if they follow the right processes – but that many people don’t believe it, so don’t fight to reach the summit.
He highlights the example of Roger Bannister, who in 1954 became the first person to run a four-minute mile. It had always seemed an impossible feat – but then, in the 12 months after Bannister’s famous run, another 37 men emulated him. The moral to the story is that a goal becomes easier to achieve once people convince themselves it’s possible. Mr Sheargold advises agents to find somebody from the industry who is outperforming them and ask what they would do if they were in the lesser agent’s position.
Another thing that holds back non-elite agents is fear of rejection, according to John McGrath. He says some people are so scared by the thought of missing out on a piece of business that they don’t chase it in the first place. Mr McGrath offers two pieces of advice for dealing with rejection. First, agents should take it in their stride, because vendors are making commercial rather than personal decisions when they decide to use another agent. Second, agents should seek feedback about why they missed out on the job.
Mr McGrath says a common reason why non-elite agents fail to win listings is that they don’t know when to keep quiet. “Great salespeople are great listeners as opposed to great talkers,” he says. “A lot of people who get into the industry think they have to be a slick talker.
“As a great agent, you need to listen and understand their goals, understand their concerns and then be able to articulate a simple plan to deliver on their goals. The agents who fail to communicate simply generally confuse the marketplace.”
Tech-savvy agents will own the future
We know what agents need to do today if they want to become elite. But what about the future? Will elite agents in five years practice the same habits as the elite agents of today?
Ms Heymans from ACTON Cottesloe is convinced the industry will look markedly different in 2016, let alone 2020. “To be an elite agent in six months’ time you’ll be doing different things. I can’t stress that enough. It’s the ability to change and to recognise that you have to change.”
Technology has been driving rapid change in the real estate industry, but Ms Ryan from Ray White says that it will never be able to supplant personal relationships.
“People are sometimes concerned about the amount of technology out there and whether technology will replace agents. I don’t believe that’s the case. I believe that agents who use technology really well will replace agents who don’t.
“Without the appropriate use of technology, agents can’t move fast enough and can’t remember enough. It’s agents who use technology to be very responsive who are going to win the next round.”
Mr McGrath identifies two factors likely to divide the elite agents of the future from the lesser agents. The first is overseas Asian investors. He believes smart agents will source an increasing amount of their business from this growing and higher-value demographic. “They will also understand those cultures and how they can best serve people from those cultures,” he says.
The other emerging trend concerns market share. Mr McGrath forecasts that the size of the Australian property pie will remain about the same – but that there will be fewer slices to go around.
“Elite agents who have mastered the art of selling will be leveraging themselves through building a team of people around them and utilising technology, which allows them to be more efficient and handle more business,” he says.
“Everything, ultimately, will be digital in terms of the transaction and process, so they will have invested and understood technology better than the rest.”