Is Your Real Estate Broker Broke?

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Why do they call them brokers?

Face it. Words have power. They have meaning. They have purpose.

Have you ever wondered why they call them "brokers"?

I used to work as a broker and wasn't very good.

It was a Wednesday afternoon and I was tired. I had been talking with a major developer on a project and was explaining how our firm could increase his listing price by tapping into our company's extensive list of buyers.  He was a friend and "recovering broker" himself and gently told me he wasn't interested in any exclusive listings.

I thanked him for his time, hung up the phone and looked at my watch and realized that I was late for our firm's weekly training meeting.

I walked into the well-lit room with plush carpeting and leather chairs. Without any available seats, I decided to stand. 

I looked around the room to see well-dressed men in expensive suits and ties listen to the firm's manager discuss the virtues and vision of the company.

I yawned and lazily looked outside in La jolla and wondered who owned all the multi-million dollar buildings overlooking the boulevard.  

Did a REIT own them? A private investor or developer?

I then took another look at the room and realized that half the room of licensed brokers probably didn't know what a REIT was.

The manager then erased his notes on his whiteboard and casually said, "Out of curiosity, how many of you personally own income producing real estate?"

I casually raised my hand and Incredulously noticed one other broker raise his.

I couldn't believe it.

Some of these hot shot real estate brokers were bragging about $300,000 commission checks and only one of them in a room full of 45 brokers owned real estate.  If these guys were so good at finding deals, what didn't they buy the deals they found?  

I quit the firm 3 weeks later and never looked back.

For the record, I work with and have some excellent brokers and value their work. They are some of the hardest working  professionals and their expertise and knowledge in some areas are invaluable.

However, I also know some very Broke Brokers.

Its not hard to tell. The Broke ones pitch a deal thinking what their commission checks will be.

The good ones pitch the deal and add value within the deal.

Put another way.

Great Brokers give before they receive.

Broke Brokers take before they give.

When being pitched ask one simple question and watch the bad brokers spin, "Mr Broker, if you are telling me that this is such a great deal, why aren't you investing yourself?"

The ones I work with say, "I am. I'm willing to waive my commission if we can partner."

See, when it comes down to it, its all about Mindset and Fear.

Good Investors continually stretch themselves and are constantly venturing out past their comfort zones. 

Bad brokers are slaves to their FEAR and content with picking up the peanuts left behind.

See what happens by creating value in your profession.

Give Before You Receive and you'll be amazed at the results.

You only get what you give.