Beware the Real Estate Lead Pirates
The internet is a sea of information. There is an answer to almost any question one could think to ask. Unfortunately as with anything as big as the internet or the sea there can be pitfalls and pirates. So for goodness sake, beware the real estate lead pirates.
The internet is integrated into our lives more and more each day. It has become more natural to use it for anything and everything. It has earned our trust for the most part. This trust is very evident when it comes to the largest investment most people ever make, their home.
A home buyer leaps on their computer to look at homes. Alas, they have found one that warrants more investigation. They blindly fill out the information request giving their name, email address, and phone number. They are not sure where the request will land but are confident that someone who knows something about the home will get back to them.
In the same vein, a prospective home seller starts looking for a real estate agent to list and sell their home. They may end up looking at websites that rate agents. Several Realtor® selections come to the surface, so they fill out the information box on the website and wait for the phone to ring. They may even call the number associated with the particular agent of their choosing. In doing so, someone answers the phone but it is not the agent listed on the site.
The personal information the prospective home buyer and seller trustingly gave to the website may easily have fallen prey to the real estate lead pirates. These are companies, agents and brokerages that may sell nothing at all. They are looking for a referral fee. They strategically set themselves up at the top of Google searches. They also use paid placement in the “AD” section of the Google search. The lead pirates like to buy space at the top of web searches to entice buyers and sellers into contacting them. They are also very proficient at optimizing their placement on searches (also known as Search Engine Optimization or “SEO”).
Once the buyer or seller contacts the lead pirates, they call an agent in the area where you are looking for a home or live and offer them you! Yes, You are the lead. This referral comes at a cost to the agent of up to 35% of the agents commission. That one ill-directed email or phone call could cost your agent dearly. In the real world, less commission could mean less service.
The buyer may get a call back from an agent who is or is not the listing agent for the property. Worse yet, the website they visited may be based in Texas when they are looking for homes in Pennsylvania. The same is true for the prospective home seller, but the impact may be even greater. A seller who agrees to pay an agent 6% for their services would like to believe they are getting good value. It is likely that the agent will have to split the commission with another brokerage that sells the home. Using this scenario the seller’s agent would get 3% commission. After the lead pirates take their referral fee, This gets cut down to 2%. Now the seller’s agent, understanding that this may be the case, may not spend the dollars required to market the property adequately.
Home buyers, if you want to find the listing agent find out who the broker or company is, call them and ask for the listing agent. It may be easier to locate this information on Realtor.com but if you scroll all the way down to the bottom of a property page on Zillow.com, you will find the brokerage name. Maybe better yet would be to do a Google search for the address of the home you like and search until you find something that says “Listing Agent.”
Home sellers, Want to find a good real estate agent to list and sell your home online? Do a Google search for “Top real estate agents in (YOUR TOWN).” Look for three or four agents who come up on the first three or four pages of the search. Odds are you will find the right person to do the job. This process goes for buyers looking for a buyer agent as well.
Most real estate agents are not opposed to giving a referral fee for a good customer lead, especially when there is a true relationship between the referrer and customer. The issue is transparency. Pirates tend not to be transparent, especially lead pirates, Arrghhhh!
Knowledge is power!
Jeffrey C. Hogue