Realtors® and Home Builders: If You Knew a Sure-Fire Tactic to Generate More  Sales- Would You use it?

I’ve been teaching quite a bit of real estate continuing education of late and have noticed there is still a HUGE chasm between Realtors® and builders.

So here’s the questions…

How can Realtors® leverage builders to increase their business in 2010?

How can builders increase their co-op Realtor® sales?

Building relationships with Realtors® and builders is the fastest, easiest way to build your business. Here’s how to do it.


Cracking the Realtor®/Builder Code

Every time I teach a real estate continuing education class I always ask this question…


“How many of you derive 5 – 15% of your income from representing buyers in new home sales?”


The statistics are pretty consistent…about 5%!

That means 95% of Realtors® AND builders are leaving money on the table.

Here’s what Realtors® are telling me about WHY they aren’t comfortable with builders…

  1. They don’t trust builders. Either they’ve been burned by a client going directly to a builder or have heard a story about it in their office.
  2. They don’t understand the building process. It’s hard to admit but Realtors® don’t feel comfortable working with builders because they don’t understand the process.
  3. They don’t think of it. Most brokerages don’t have a training program that deals with buyer representation in new construction. Out of sight and out of mind.
  4. They don’t want to wait to get paid. Would you? Let’s see…you can sell a used home and get paid in 45 days or wait 6 months to get paid for a build. Tough choice, isn’t it!
  5. They don’t realize new homes are available in the area they’re showing homes. Most Realtors® don’t realize infill possibilities exist. Most aren’t aware of remodeling options and renovation financing either.

Now I’m sure there are more reasons but these are the top 5 I’m hearing on a consistent basis.

Builders Pay Attention

Because 85 – 95% of all transactions in any particular market are used- builders need Realtors® a lot more than Realtors® need builders.

Here’s the top mistakes I see builders making when it comes to working with Realtors®…

  1. Paying the builders representative a higher commission if no outside Realtor® is involved. And how is this set up supposed to foster better cooperation?
  2. Making the client registration process difficult. Have registration forms available at your model, office and on your website. Phone calls are just fine for temporary registrations too.
  3. Relying on the MLS for your Realtor® business. Relationships, not showings will build your Realtor® business. Remember Mr. Builder, you need them more than they need you. You have to put your best foot forward to get these relationships going.
  4. Treating the co-op fee as a commission. The 2-4% you pay out, Mr. Builder, is not a commission- it’s a marketing fee. The best news is you don’t pay a dime of it unless the sale is made.
  5. Offering to take 2-4% off the price since the buyer doesn’t have a Realtor®. Look, I work in the trenches with my clients and I know how tight deals are today. But the minute you utter these words to your buyer and they get back to the Realtor® community- it’s the kiss of death. AND think about it- unless 100% of your sales are with cooperating Realtors®, you don’t have a 2-4% co-op fee built in on every sale.

So herein lies our problem- Realtors® and builders keep traditional mind sets and no new business relationships are fostered. Well, is that good enough for you in 2013?”

Fresh Opportunities for the New Economy

Realtors® and Builders can’t continue the oil and water relationships of the past. Each needs a new avenue for business and both have something the other wants.

I’ve developed a list of “best practices” for Realtors® and builders. It’s called Cracking the Realtor®/Builder Code- 10 Sure-Fire Tactics to Jack up Your Sales.

This list is based on direct feedback from Realtors®, builders and builder sales representatives.

You can download it for absolutely FREE by clicking on this link>>

What about Your Thoughts?

Am I missing anything?

What are some of the successful relationships you have fostered with Realtors or builders?

We all have our horror stories of the past but that won’t help anyone grow their business today. I look forward to hearing what you think! Leave a comment below.

Happy Selling!


P.S. It doesn’t matter if you’re a Realtor and have never sold a new home or are a seasoned builder representative. You need to change the way you approach working with each other.