Since launching their ground breaking real estate service, just two years ago, more than 150 South Canterbury home-sellers have benefitted from keeping over $730,000 extra equity in their pockets. That’s an average windfall of around $4,800 each – to use for what ever they wish.
Recent clients, Bill and Gail, said they plan to put their $8,721 savings towards building their new home. Jock & Lorraine said their $4,432 would pay for their new blinds. While Kay and Neville’s bonus of $12,258 went straight into their retirement fund.
When asked how these extra profits are generated for clients, Carl Slade, the founder of Restate said, “It’s simply a more efficient model.”
Firstly we set out to solve the two biggest issues with the real estate industry: It’s poor reputation and excessively high commissions. So asked ourselves – How could we raise professionalism and at the same time create more value for our clients?
The solution lay in accepting what is responsible for those problems in the first place, and that is, the ‘Commission-Only’ model our industry was built upon.
We looked at how true professions operate. Think doctors, accountants, solicitors and the like. They have a ‘Professional Service’ culture. Their key function is to protect and help their clients. They use their specialist knowledge and skills to the clients advantage. They advise and serve. In a real estate sense, this would mean protecting sellers from costly mistakes and helping them bank the most profit from their sale.
For obvious reasons, this kind of professionalism is attractive. To know your service provider will do the very best by you, removes much stress and worry.
We asked why nothing like this exists in real estate? Instead, the industry operates on a commission-only sales culture. You know; cold calling, self-promotion, scripts, sales pitches, closing techniques. On the whole you are dealing with commission-only salespeople.
Let’s face it. There’s that underlying doubt around in who’s best interests the industry is really working? And the commissions traditionally charged… well they’re based on the value of the clients property, which is totally unrelated to the actual work involved in facilitating the sale.
I mean, just because my home is worth more than the one down the road – why should I pay more for the same service?
And, if my home sells easily – because I’ve presented it well and priced it realistically – why should I pay the same commission as sellers who take two, three, or four times as much work and outgoing costs for the agent?
It just doesn’t make sense. The genuine sellers are effectively subsidising the non-sellers, as well as supporting all the time and money the industry spends on prospecting and self promotion. But that’s the way it’s always been done.
We thought it was time for a shake up. If respected industries can operate with a professional service culture, then why couldn’t a similar approach be created for real estate?
Do homeowners not deserve to know that the agent has their best interests at heart? Do they not deserve to bank the most profit possible?
This led to a massive amount of research and a total re-think of how the real estate industry works.
The next logical question: Based on a professional culture, could we develop an approach for real estate that could consistently create better results for our clients? That is to say, consistently sell homes at a higher price point, while at the same time reducing the clients costs – maximising their profit.
If this were possible, then homeowners could have total and complete confidence that not only would their best interests be protected, but they will also bank the absolute most possible from their sale.
In short, after just two years, it’s now proven to be more efficient for both our clients and us as agents. It’s a breakthrough. A real win/win.
Mr Slade said that they are now getting enquiries about their approach from sellers and agents in other parts of New Zealand, even Australia and the USA.
“It’s still early days, but there’s definitely some interest out there in the model we’ve developed. It’s seems we may be onto something special, potentially industry changing. So we’re starting to look at the best way to share the approach others.”
“But I’d like to make it very clear, our pioneering clients – right here in South Canterbury – are the real heroes of this story. We simply couldn’t have made this work without them.
After all, we are challenging the status quo, offering something completely different to what consumers are used to from real estate agents. As we know, people are wary and often fear change.
We are therefore very grateful to our clients for choosing to reject the traditional way and put their faith in this new approach. We can’t thank them enough for supporting our efforts to lead positive change in this industry. It’s really satisfying to see them rewarded with such great results.”
