- Dallas brokerage Real Estate Concierges is floating a new business model, touting its lifetime real estate consulting services as its core value to clients.
- The firm is on track to close 25 transactions this year and is profitable.
- Real Estate Concierges floats another model that attempts to shift agents and brokers’ value propositions as technology makes transactions easier and perhaps cheaper.
Three weeks ago, Charles Gay and his wife returned home to find their garage side door kicked in, their MacBook Air and iPad gone, and their living room TV broken.
After reporting the crime to the police, “My first thought was to call Heather,” Gay said.
Real estate broker Heather Anderson, 35, helped Gay and his wife buy the three-bed, two-bath Dallas home a few months earlier. On the call that day, Anderson gave him advice on how to deal with his homeowners insurance company, which eased his mind.
The intimate association Gay has for Anderson and his family’s home is no accident — Anderson’s betting her real estate future on it. Anderson’s been in the industry for 13 years and has owned and run a traditional real estate firm, Janus Real Estate Group, since 2009.
But she helped Gay and his family buy their home through Real Estate Concierges, a brokerage she co-founded in October with a model that addresses the eroding value she feels brokers and agents bring to a deal.
Sensing a growing proportion of tech-savvy, do-it-yourself consumers, along with the popular portals and new digital technology that makes life easier for both agents and clients, prompted Anderson to ask herself: “Where does a broker and agent’s value really lie?”
The answer? A brokerage must go beyond the transaction to justify a traditional commission rate, she reasoned.
While it charges clients a full commission and provides full service, Real Estate Concierges’ core focus centers on becoming a client’s lifetime consultant for all things home, including accounting and change-of-address services.
What if a former client needs their gutters cleaned, a door resized, real estate tax or investing advice, recommendations for a good roofer, tips on what to do when they’re burgled? Real Estate Concierges has a handyman on staff (the first two hours with the handyman are free with closing; his services are $50 per hour thereafter), and its three full-time agents are ready to take a call to share their expertise anytime.
By providing ongoing, useful real estate information and services, Anderson and co-founder Jay Remley believe their firm will secure long-lasting relationships with clients, capture repeat business and referrals, and justify the full commission rate as real estate’s landscape continues to change.
Like a growing number of real estate brokers, she is tweaking her business model to adapt to technology and consumer changes. Concierge services aren’t new, but Real Estate Concierges is putting a different spin on it with technology.
The three-agent Real Estate Concierges has been profitable since March and is on track to close 25 deals in 2015, according to Anderson. She plans to shutter Janus Real Estate Group, which has nine agents and closed 157 transactions and $33 million in sales in 2014, and fold it into Real Estate Concierges.
The “broker as real estate consultant” model
Real Estate Concierges’ clients have access to a back-end dashboard where they can access all their transaction documents at any time. They can also see a list of the brokerage’s preferred vendors.
Like other brokerages looking to rewrite their models for a new real estate era, Real Estate Concierges has full-time agents who earn a salary and benefits.
The team approach ensures that there’s always someone there to cover when a client needs help, Anderson said.
Finding agents willing to be team players is hard, however, she said. To encourage buy-in, agents get an ownership stake in the firm with shares that vest over four years.
Some of the services Real Estate Concierges provides sellers:
- The firm provides sellers access to the change-of-address app Updater and provides other move-related support as needed.
- It connects sellers with an accountant, who advises them on how best to handle their closing proceeds, how it will be taxed, and gives advice on whether to reinvest it or apply it somewhere else.
- If sellers or their relatives have any real estate question associated with the close or down the road, the firm encourages them to reach out.
Some of the services Real Estate Concierges provides buyers:
- Upon closing, the firm sends out its full-time handyman to make sure the home’s in top move-in shape. He touches up paint, installs new locks and other light maintenance as needed at no cost.
- For bigger maintenance needs, the firm helps vet and get quotes from service providers.
- The brokerage also helps them shop for homeowners insurance and negotiate taxes.
- Each buyer gets a housewarming party, paid for and coordinated by Real Estate Concierges.
Why change the game?
Anderson and Remley studied the habits of millennials, the digital-bred generation of individuals born between 1980 and 1995 poised to dominate real estate, to shape their new brokerage model.
More than 50 percent of millennial homebuyers found their homes themselves online, according to the National Association of Realtors’ 2015 Home Buyer and Seller Generational Trends report. That’s more than any other generation. Older generations, too, relied more on the Internet than their agent to find their homes.
Where buyers found the home they purchased
|Generation (Year born)||Internet (% of respondents)||Real estate agent (% of respondents)|
|Gen X (1965-1979)||49%||28%|
|Younger boomers (1955-1964)||39%||36%|
|Older boomers (1946-1954)||34%||39%|
|Silent generation (1925-1945)||24%||27%|
That stat, paired with Anderson’s experience with buyers and sellers and Remley’s as a real estate investor, helped strengthen their position.
Remley, an executive at Google, lives in Silicon Valley and met Anderson several years ago when he used her firm to help buy and manage Texas investment properties.
In 2013, Remley gave a talk to a group of Realtors in Dallas about how technology will change real estate. The blank stares and resistance in the room surprised him. That night, he and Anderson, who attended the talk, went to dinner and began working on their business model.
The early results suggest that Anderson and Remley’s test is a success. It’s profitable, and at least one former client isn’t going anywhere.
Anderson was the first agent Gay and his wife interviewed, and she may be the last.
“If I’m in the market for buying a house again, I’m going to call her,” Gay said.
Odds are, he’ll talk to her before then.