Are real-estate agent incentives really a homebuilder’s best bet?

Real-estate agents are a major factor in getting more than your fair share of sales. Ask any new home sales professional what got them to the top of our industry, and real-estate agent sales are sure to make the short list. It's not surprising that when builders need sales, they entice real-estate agents with all kinds of incentives.

Real-estate agents are quick to point out that they love spiffs and bonuses; however, they're short-term, expensive solutions that typically provide only tepid results. I have often compared real-estate agent bonuses to liposuction: a quick, painful solution to what could have been accomplished through basic changes in everyday habits.

So what makes a real-estate agent really show your homes and community? As a builder, you should pay attention to the following:

They know and trust the builder. Many companies short-changed the realty community during the go-go days when they could sell all the homes they wanted without paying co-op commissions. Today these same real-estate agents often look for retribution. While there is no way to rewrite history, owners and senior management should first consider how to personally reach out to the realty community to show their unqualified commitment.

Competent on-site sales team. With a lot of turnover among new-home sales professionals, many top real-estate agents feel like they are rolling the dice when they enter a new-home sales office. No amount of spiff or bonus will bring a top real-estate agent to a sales office if he or she believes the new home sales professional is incompetent or unable to close the sale. When doing outreach and meeting top real-estate agents, your sales staff shouldn't simply explain why they want their business; they should demonstrate their competence.

An easy-sale community. Time is a real-estate agent's most valuable asset. Real-estate agents want to show communities that sell themselves. When doing outreach with real-estate agents stress the compelling value of your community, sales you recently made and the attributes that make your community the easiest sell in the market place.

Great customer satisfaction. While everyone likes a happy customer, real-estate agents live or die based on the satisfaction of their customers. Most top real-estate agents receive 90 percent of their business from referrals. Top real-estate agents know that without a happy experience with their new home customer, their chances to get the re-sale listing in a few years are slim to none.

Spiffs and bonuses. Once you have addressed the issues above, go ahead and include all the spiffs and bonuses you can afford. Real-estate agents really love them.