Communication is at the center of real estate. While it is crucial for the success of any transaction — from a traditional resale to a short sale — proper communication is almost never achieved without facing major obstacles.
Simply put, a real estate transaction is a negotiation between a buyer and a seller who must communicate effectively to complete a deal. However, looking more closely, their ability to communicate depends on the real estate agents and other entities involved in the process such as closing and title offices, attorneys and loan originators.
Inevitably, at some point communication will break down. One person will mistakenly fail to pass along a message; one party will be confused about next steps; a real estate agent will take a vacation day; a document will go missing — the causes are numerous.
The best way for agents to repair persisting communication issues is to identify exactly where the most common barriers lie. From there, they must proactively work to prevent those occurrences from creating poor experiences for their customers. Contact must be improved not only between buyers and sellers, but also among every party and individual touching the transaction. By creating a more streamlined experience in a process notorious for challenges and delays, agents have the opportunity to create returning customers and secure the valuable referrals on which their businesses rely.
Agents of change
San Diego-based real estate agent-broker Jesse Zagorsky, like almost every agent, has firsthand experience with communication hurdles. He has made significant changes to eliminate the communication issues he and his peers face, and as a result now enjoys better internal operations and happier customers at the end of the day.
Jesse shares that the most common communication gap is also the one that can occur at any stage in the process — unknown status updates. With so much back and forth, relying on emails and phone calls makes it difficult for real estate professionals and consumers alike to identify exactly where the process stands at a given time. Action items and documents can easily go missing or be completed improperly, leaving people to wonder who is responsible for the next step. They often ask themselves, “What am I expected to do next? And when?” Jesse knows of many offices that hire full-time transaction coordinators as an attempt to manage this issue, a costly solution that still does not provide everyone with constant updates and true visibility into the status of the transaction.
In today’s connected world of Facebook, Twitter and Instagram, everyone immediately knows when a friend becomes engaged or lands a new job. People now want the same instant knowledge and clarity during a real estate transaction. According to Jesse, “Having constant updates is not just a luxury, it is a necessity. I now use technology to bridge the gap between myself, my clients and all other parties to keep everyone apprised of a transaction’s status. Having a full-time employee for this simply is not practical, and this strategy still doesn’t provide customers with access to the immediate insight they want. It also doesn’t stop agents from receiving constant phone calls with questions and confusion about what to do next.”
Communication and compliance
With so many moving parts in an agent’s office, there are several inevitable communication gaps. Jesse shares that for himself and all other brokers, these back-office barriers are now more than inconveniences, they are serious compliance issues. Brokers and agents must remain continuously connected to ensure all paperwork and documentation is complete, accurate and archived.
“Compliance has become such a pressing issue for brokers, and one that is not going to subside, so pushing paper is no longer acceptable,” said Jesse. “Every office — large or small — must have a way to electronically share documents between brokers and agents and even clients and third parties. A lot of our headaches have been alleviated by having electronic documents that are automatically archived. This makes for much quicker and easier access when we need them.”
The art of negotiation
The real estate transaction centers on the negotiation. It is during the offer negotiation process that communicating accurately and in a timely manner is absolutely paramount. There are often communication breakdowns in the time between when the buyer’s agent submits the offer and when that offer is accepted. Prospective buyers make their decision and expect an offer to be sent and received immediately; however, they are not always aware of the lengthy chain it must go through to be processed. By the time the listing agent reviews the offer and discusses it with the seller, days can pass. And, several hindrances can transpire before a counteroffer is made.
Jesse has witnessed this time and time again. “I have seen agents extremely disappointed when, in the time an offer took to go through the pipeline, a buyer had a change of heart. Maybe fluctuating interest rates caused them to reconsider. Maybe the time in between gave them room to rethink this huge decision and get cold feet.” This common scenario is likely the most direct example of how communication challenges can severely hinder agents’ efforts and their bottom lines.
Timing issues cannot always be solved, but Jesse has successfully reduced timelines by taking the negotiation process online. He explained, “There is no reason for these matters to persist when technology makes it possible for an agent, even with his or her mobile device, to send or review an offer and take the next steps right away.”
Taking confusion out of the closing
During the closing process there are often gaps between the selling and buying sides. For instance, the buyer’s agent tells his or her customer that everything is on track, but inspection paperwork has not gone through and delays have not been communicated with the loan officer. In this case, the agent is not able to manage the customer’s expectations beforehand about the change in closing date.
“Even worse than the frustration is the logistical nightmare and even monetary expense consumers incur when this happens,” Jesse said. “A typical scenario would be a loan that is supposed to close on Friday, the 30th. The buyer expects to receive the keys to the home on Friday afternoon and move in over the weekend. Everything is packed and movers have been hired. However, behind the scenes and unbeknownst to the buyer, phone calls are being made from the agent to the escrow firm regarding a technicality and the lender is not picking up the phone. The listing agent is calling the closing company — when the clock strikes five, every office is closed and there is no chance of a buyer getting in contact with the right person. It is beyond aggravation at that point for the buyer, who is now in limbo.”
Agents must find a way to keep this scenario from recurring. All parties understand delays to some degree, but what they do not understand is the lack of communication that has become so commonplace. Jesse has found that a system that delivers instant alerts to all parties simultaneously removes the game of telephone tag that leads to miscommunication and misinformation.
Making the process something (good) to remember
A home sale or purchase is one of the most important, life-changing decisions a person can make. And, unfortunately, communication breakdowns have often kept it from being a pleasant experience. The real estate process has long been looked at by consumers as a closed-door transaction — a huge, personal life event that they must entrust to agents. However, today’s business and tech-savvy consumers demand more interaction and insight. They want transparency into their own transaction, and their use of technology in every other aspect of their lives tells them that open lines of communication are possible.
Agents in today’s complex and competitive market must rely on new methods and technology to effectively communicate with customers, colleagues and other third parties. Making key changes to the traditional way of managing a real estate transaction goes beyond improving operations — it is now a crucial part of an agent’s overall business strategy. Agents now have the opportunity to remove these common obstructions to communication; new tools and technology empower them to take their businesses and the consumer experience into their own hands.
Author: Todd Mobraten – Inman.com
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