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Takeaways:
- Brokerage donates 25 percent of every commission and still turns a profit.
- Little need to advertise, demographics, scrimping and philosophical buy-in from agents drive business’ success.
- Socially minded value proposition can create immediate trust between agents and clients.
A $1,500 donation to the American Cancer Society was recently made in honor of Laurie Loew, owner of Austin, Texas-based Give Realty.
The gift may have been a gesture of support to Loew, who was diagnosed with stage 4 cancer in March. But it also embodies the success of her brokerage.
Give Realty donates a quarter of every commission it earns to nonprofits on behalf of clients. And socially minded buyers and sellers flock to the brokerage, often forming lasting bonds with its agents.
A couple who purchased a $200,000 home with Give Realty chose to honor Loew by selecting the American Cancer Society as the recipient of the brokerage’s donation.
Laurie Loew (right) with her sister (left) and mother (center), who passed away unexpectedly this month.
Real estate agents and brokerages often make donations. But when the going gets tough, the gesture — which is often more a marketing strategy than a truly selfless act — can disappear.
Some agents tend to toot their own horns about giving back. Loew isn’t one of them.
Speaking in a calm and tender voice, she often revises statements or employs self-deprecation to downplay both her accomplishments and hardship.
She’s an unmistakably sincere person, and it’s difficult to disbelieve her when she says that she founded Give Realty to make the world a better place.
The facts also speak for themselves: Give Realty has donated more than $440,000 since its launch in 2008.
Give Realty clients who recently donated $3,878 to Outreach Ethiopia, “whose mission is to assist the orphaned and vulnerable children of Weledi, Ethiopia.” Source: Give Realty
When Loew first hatched the idea for Give Realty, many of her peers thought she was nuts. They would have been even more skeptical if they knew that she would launch the brokerage just six weeks before a financial meltdown.
But “to the amazement of a lot of people in the industry,” Give Realty was able to weather the housing crisis, and it has emerged as a paragon of social entrepreneurship in real estate.
The seven-agent brokerage doesn’t only funnel money to nonprofits. It actively cultivates generosity in clients.
Every client who works with a Give Realty agent must choose the recipient of the donation that comes out of Give Realty’s commission.
If a buyer or seller can’t easily decide on a recipient, Give Realty will personally introduce those clients to nonprofit organizations. Loew also sometimes refers clients to a friend who consults with nonprofits because Give Realty wants to remain “a neutral third party” in a client’s decision.
Give Realty takes measures to ensure that clients don’t renege on their commitments. The brokerage writes a provision into a buyer client’s sales contract stipulating that the promised donation go straight out of escrow to Give Realty, which then passes the gift on to its intended recipient.
Seller clients are responsible for making agreed-upon donations themselves. If they don’t, they violate their sales contract.
Give Realty closed around 60 transactions in 2014, according to Loew. It’s on pace to do the same number of deals this year.
Loew thinks Give Realty might have been doing more volume this year if chemotherapy hadn’t sidelined her.
Agents at Give Realty earn compensation based on commission, while Loew pays herself a salary.
Part of the reason Give Realty can turn a profit boils down to the demographics of its market, Loew says. Austin residents are eager to give back, and they gravitate toward innovative ideas, she said.
“It has a huge volunteer rate,” she said. “I thought it was a really great place to give it a try.”
Another reason: The firm doesn’t need to spend much money to drum up business. Its mission resonates deeply with certain segments of consumers.
Although marketing is typically a “huge expense of creating a name,” Give Realty has “others marketing on your behalf,” she said.
The firm’s value proposition also tends to breed immediate trust between agent and client, freeing up Give Realty agents to spend less time reassuring prospects or clients and more time putting together deals.
There is “a lot less hand-holding for sure,” Loew said. “You’re already on the same page. You already care about something. You already want to make a difference in the world.”
A recent Give Realty client donated $880 to the American Red Cross of Central Texas “to provide relief for victims of the recent Central Texas floods.” Source: Give Realty
That goodwill inevitably nets the brokerage plenty of referrals, which account for 80 percent of Give Realty clients, according to Loew.
Philosophical buy-in from its agents also underlies Give Realty’s success: Its agents choose “to live conservatively” according to the firm’s website.
“I do live my life differently. I live in a very modest house. It’s a lifestyle choice,” she said, though she added that she still earns “six figures a year.”
Give Realty deducts the donations it makes on behalf of buyer clients from its taxable income. But in the case of seller clients, the sellers receive the tax benefit, not Give Realty. That’s because they make the donation directly, not indirectly through Give Realty.
“We choose to make a charitable donation in lieu of most ‘normal’ business expenses — like office space, expensive advertising and/or marketing of the business,” she said. “We don’t cut corners on our client’s marketing efforts, just the business.”
Loew says that making Give Realty’s donations “foolishly high” has turned out to be the smartest thing she’s ever done.
Having previously dipped into her retirement savings to keep Give Realty afloat during the housing slump, she now earns a comfortable salary.
And she cherishes the relationships she’s formed with clients more than ever.
“My clients have been totally there for me,” she said, speaking of their support for her during her treatment. “I get cards in the mail from them. They’re rooting for me. They’re supportive and come to chemo.”
“My clients end up being my friends.”
If you’d like to learn more about Give Realty, Loew invites readers to email her: info@giverealty.com.