Agents can market new homes inventory and shop by address.
INMAN NEWS — Builders Update rolled out a new technology feature last month that may change forever how real estate agents and homebuilders do business. A lot of business.
“We need to be clear that this is not a new feature for homebuilders. Our mission is to make our technology work for real estate agents, because if it works for them, it will work for homebuilders,” said Bill Gaul, Builders Update Chief Executive Officer.
Gaul, a West Point graduate and successful Internet entrepreneur, added “For it to work, real estate agents must be able to provide available inventory directly from their websites to their ready, willing and able prospects to showcase home builders. The challenge was how to protect the real estate agent in the process.”
With that background, over a three hour lunch Gaul, he proceeded to share why their new technology, which rolled out in January, will ‘revolutionize the Realtor/Builder relationships and change the way real estate agents practice real estate.”
“We solved the problems,” he said, “that our research with real estate agents told us we needed to solve if real estate agents were to become seriously committed to marketing and showing new homes inventory.”
“We learned that they want to show new homes, but they feel it is difficult to find just the right inventory as they could on MLS. New home builders don’t typically put all of their inventory in MLS nor is it up to date with complete information. But even if they do, they are not sure how the builders’ prospect registration works,” Gaul said, “There are serious issues involving trust that homebuilders cannot solve.”
What he was telling me was not news, but what he said his company had done about it, is so compelling and so hard to accept that I offered to do something I have never done: spend whatever time it took to see for myself why he was so proud.
This could be too important not to not know firsthand exactly what the technology did, so over the last 90 days or so, I spent more than 15 hours with the company’s Chief Operating Officer Lee Goldstein on the phone and at the screen going through every detail of the site. I questioned, challenged, reviewed, and did all I could do to determine what I thought was “truly innovative” vs. what might be just “me too.”
Home builders reach out to real estate agents by providing services, events, bonuses, encouragement, training, and now, even offering to set up appointments for agents’ prospects. In return, 63% of all new homes sold in 2012 were indeed sold by general real estate agents, according to NAR’s 2012 profile report.
Most of us know how through social networking, just one anonymous agent who brings an unsubstantiated commission complaint against a defenseless homebuilder on the Internet could sully the reputation of working with all home builders. So when someone with Gauls’ credentials tells me that his company has solved the problem, I listened.
Here are the top three innovations that without the third one listed, the other two wouldn’t matter. With it, the first two become sales technology imperatives.
1. Problem: Agents cannot offer new homes inventory on their websites because their commission cannot be protected.
Solution: Agents can now offer new homes inventory and floor plans from their website with no additional effort. Builder’s name and contact information as well as a MLS type detail sheet are provided to the prospect only after the prospect agrees to use that specific real estate agent offering up the information to them. Additionally, if Buyers perusing the Internet for new homes are not yet represented by an agent, they are offered a licensed agent who works in their desired area, creating even more free leads for agents.
2. Problem: Agents cannot shop new homes by home address.
Solution: Agents now can, using map technology shop by specific address or within self-defined boundaries.
3. Problem: Prospect registration can be confusing, inconsistent and generate more doubt than assurance regarding the homebuilder’s commission policy.
Solution: Electronic prospect registration initiated by the agent, approved by the builder in real time, recorded with a date and time stamp attached.
According to Gaul, the electronic prospect registration is currently patent pending.
From my view, it is the electronic prospect registration that captivated me, because this technology delivers something much more than speed, convenience, and inventory. It delivers TRUST.
It delivers registration clarity and confidence, date and time stamp included. It gives the agent much needed control of the prospect and the home builder’s thoughtful acceptance or rejection of the prospect registration.
“At West Point, we had an honor code that shaped my life,” Gaul said. “You could build a trusting relationship with others using this common code during the exchange of information. In business, we just needed to create a little bit of technology to foster honesty by backing it up with real facts.”
The underlying truth of the matter is that without trust as the cornerstone, there can be no meaningful relationship, no matter what the seller does for the prospect, in any business.
“If agents perceive that the commission could become an issue, due to prospect registration conflicts, agents will not participate with that builder, or for that matter ‘builders’ in general if they can help it,” Gaul added. “Regardless of the technology available.”
“On the other hand, builders need to know they are working with real prospects. The fact that the prospect is willing to work with a Realtor is a good indication that the prospect is seriously looking for a home, be it resale or new,” Gaul said.
“We are not concerned with the number of ‘hits’ on our site. Rather, we are focused on delivering good prospects to the homebuilder working through a network of real estate agents from around the country and the world for that matter, and the agent gets paid if the prospect purchases a new home from that builder. It’s the ‘if it wasn’t for me rule’ being applied, electronically.”
Lee Goldstein, Builders Update’s Chief Operating Officer, said the company designed the system to work with builder’s current policies and procedures, giving them final word on how long pre-registration lasts.
Pre-registration is an option designed to protect the agent until he/she can bring the client to the model, in case the prospect walks into a sales office, after they were educated by that agent but before the agent has a chance to introduce them personally at the sales office.
Real estate agents register at no cost. Builders pay a registration fee based on the number of subdivisions that are involved.
“We feel we have a trust based system that delivers every feature that agents have said they needed to become truly involved with new homes,” Gaul said.
Evidentially, agents are testing his assumption. “We have had an increase of more than 1,100% in agents registering with us and using the free service since we rolled out the electronic registration capability, in January,” Goldstein said.