I'm a full time agent, and I am also an Advisor. I realize that giving up to
a 35% referral fee is pretty high, so there must be a reason for it. Before
I go into why it's so high (and why you should be happy it's so high), you should
realize the upside of being an Advisor:
You can find good investment properties and email them to the client
database.
We are projecting to have more than 10,000 clients registered on the
site in the next year. If you have a good investment property, it's likely that
it'll get snatched up. We do this now and we have typically written an offer
within four hours of emailing them out. Only Advisors can do this.
This is not a lead generation business, it is a true referral network.
Agent Connect, Service Magic, and House Values are all lead generation businesses.
They collect data and send it to agents for a fee. You will be working with
clients who are referred to you. You don't have to win them over, they
are coming to you because they want to work with you, not because you're paying
for them.
You will be able to work with a large number of clients without spending any
marketing dollars.
A rule of thumb is that long term, successful Realtors spend at least 20% of
their revenue in marketing. Because this is a referral network, not a lead generation
system, you receive clients at no cost except the referral fee.
Investors have the best credit and easiest financial scenarios.
You wouldn't be reading this page if you didn't have experience
working with investors. As we all know, investors tend to have the best credit
and easiest financial scenarios. They don't need to buy, they want
to buy, and if finance was an issue, they wouldn't fly to your market to be
looking. They buy on numbers and data, not dreams and heartstrings. Show them
a valid deal that is worthy, they will buy it. Sure, we have all had the bizarre
investor that wants a 100% LTV, neg-am, no doc, non-owner occupied loan, but
in general, investors tendo to have a more stable financial picture.
Working with investors means that you could sell them multiple properties.
We estimate the average investor will buy three properties, and many will buy
all three in the same market. (Even though we push geographic diversification,
investors tend to get sweet on a particular market.) If you go hunting for properties
and find five good deals, they could easily buy two or three of them. The cool
part is, if they "only" buy three of them, you still have two more
to email to the client database. This means that you reduce your wasted research
to almost nothing. There isn't a one of us who hasn't found three good properties,
the investor you were working with didn't write on a single one of them, and
you get frustrated having done all that work. With NARREIA, if you have a good
one and you've ran it past all your own clients (why give up a referral fee
if you can sell it to one of your own clients?), run it up the flagpole and
see if you can find any takers. Like my momma always said, "Work smarter,
not harder." Actually, my mom never said that, but it does apply here.
(By the way, NARREIA is fun, too.)
NARREIA provides free investor education, online and soon in traveling
seminars and conventions.
Some of you (like me) enjoy working with newer investors, but others hate it.
While many of NARREIA's Clients will be new to real estate investing, they have
access to free education. It also means that there is a standardization in their
instruction which will provide a common foundation of terms and concepts, making
them easier to work with than your randomly discovered investor.
Advisors tend to be closer to the action.
There is no "inner circle" at NARREIA, but the Advisors
tend to be closer to the action, and therefore, will be seeing the properties
that float by. As most (if not all) of the Advisors are also investors, this
means an incredible investment opportunity.
Advisors will be invited to attend Advisor Only functions.
The true value of this benefit is still left to be defined, but one example
is the first day of our convention in 2007. There, the Advisors will meet,
and a portion of the day will be to share systems and techniques with each other.
We all have our strengths and weaknesses. If one of you have come up with an
incredible marketing system and another has a great technology solution and
yet another has a telecommunications package that rocks, why should we all reinvent
the wheel? The Advisor group is incredibly intelligent, and the synergy has,
so far, been extremely rewarding. Like my local operation, NARREIA is a team,
and team players will understand the power of our synergy. (Oh, the team concept
includes Clients, too. We can glean a lot from their participation, feedback,
and scouting reports, as well as their dialog in the Forum.)
The Market Conditions element of the website is like RealtyTimes,
but with an investment focus.
A small portion of our website has some similarities to www.RealtyTimes.com.
If you're not a member there and posting market conditions for them, you are
missing out on one of the best marketing dollars that I've ever spent, especially
online. Realty Times costs $500 a year, and you can post in 5 places. Their
definition of "market" is very different than what most people think.
They consider Las Vegas, North Las Vegas, Henderson, and Summerlin as four different
markets when they are just four different sections of the whole "Las Vegas
Market." I encourage all of you to be a member of Realty Times, but the
issue as it pertains to this document is that I'm letting you post on NARREIA
for FREE. There will never be a fee to belong, so this isn't a "let's get
them to post until we get inertia and then start charging them" routine.
NARREIA depends on good, solid market condition reports from our local area
experts, the Advisors. A significant distinction between Realty Times and NARREIA
is that they will let anyone who pays them $500 to post, and you can post as
often or seldom as you wish. At NARREIA, you are invited to post, for free,
and are expected to post, or are asked to downgrade. We have an RSS feed, which
means that all of the reports that get posted on the site will be broadcast
to potentially thousands of other websites looking for good content.
When that happens, your name and a method to find you are printed with the article,
in whole. Consider it an incredibly powerful and free marketing tool. (Now get
writing!)
Benefit from the coming value of the label "NARREIA Advisor".
Right now, it may not seem much, but I believe within the next year,
the label of being a NARREIA Advisor will carry a lot of weight. Before
there was a designation for CRS or GRI, those designations didn't seem to mean
much, but it does now. I honestly don't know how much those designations mean
to the clients. CCIM was nothing the day they released the designation, but
it signifies a very small, elite group of commercial agents today. To be clear,
these designations are very different because they require many hours of regulated
courses, whereas the NARREIA Advisor designation process is very subjective.
To the public, however, right or wrong, this distinction is almost transparent.
I believe the buzz about NARREIA will be so big very quickly, the public will
definitely know the value of the NARREIA Advisor label. It is definitely something
to consider.
Most Referral Fees are gone after a Client has been registered with NARREIA
for two years.
When an Agent refers a Client into NARREIA, they receive a 30% referral fee
for any contract written by a NARREIA Advisor in the first two years the client is
registered with NARREIA.
That's very generous considering the industry standard is a 20-25% referral
fee on one (maybe two, if you know it's coming) transactions, period. Upon
a Client's second anniversary with NARREIA, a referral fee is no longer due
to the Agent that referred them into the group. Realize, if you buy a property
for a client this year, they will probably keep it 1-5 years. If they hold it
for two years, when you go to sell it, you will not owe the Agent a referral
fee, and will only owe NARREIA a 5% referral fee. There are definite short-term
benefits, but there are long-term benefits as well.
Advisors have a much longer residual referral fee schedule.
If I still haven't gotten your attention yet, this will likely do it. As I
said, Agents get a 30% referral the first two years their clients are registered, with nothing in the
following years. Because Advisors have to do a good amount of work, they
are rewarded by a longer, more advantageous referral fee schedule.
They receive a 30% on all transactions for as long as they are an active Advisor.
This means that you have a much longer residual revenue stream when compared
to Agents. Again, this is a privilege earned by Advisors, which is fair. It
is also incentive to keep your profile active, as this referral schedule only
applies to Advisors. If you fail to keep your profile current by not posting
market conditions for more than 45 days, your account is downgraded to Agent
and the Agent referral schedule will apply.
