Good relationships between homebuilders and brokers create valuable business opportunities for both sides: builders benefit from access to potential buyers, while brokers benefit from access to more for-sale homes.
These relationships don’t happen by accident. Rather, builders and brokers make the effort to connect and talk about what they have to offer each other.
James Attwood, sales manager at Maracay Homes in Scottsdale, Ariz., says builders want “as much interaction as possible” and the ability to promote their homes to the broker’s sales agents and buyers.
Interaction and Promotion
Attwood says interaction and promotion are important because Realtors are involved in 70 percent of the company’s sales. That proportion is so large that the builder “takes the ownership” of its broker relationships, though the door’s open for brokers to come in on their own as well.
Brokers are encouraged to promote Maracay’s homes, offer new home sales education to their agents at Maracay’s communities and invite the builder to sponsor and speak at the broker’s sales meetings.
“We take all this information to the local realty offices and, ideally, meet directly with the broker,” Attwood says. “Beyond that, we’re looking for opportunities to do presentations.”
Access to internal distribution lists is also on Attwood’s wish list for brokers since the builder can’t connect with all the Realtors in any one office through in-person events.
“We’re not opposed to collecting as much of their contact information as they are willing to share,” Attwood says. “But we know we don’t have everybody, so distributing information among (those on) their team that it pertains to would be a big help.”
Software and Respect
Ken Thieneman is president of Ken Thieneman Builder in Louisville, Ky. He’s also a broker.
Until five years ago, Thieneman sold all of his new construction homes himself with the help of his sister and one other Realtor. Today, with as many as 10 developments open, he’s outsourced his sales function to a local brokerage on an exclusive basis.
“It’s costing me more than it would if I was running it myself, but they do a better job,” he says.
One plus was the broker’s computer power with its prospecting and buyer-tracking capabilities. “I don’t have that software and I don’t have the computer-savvy to do it if I had the software,” Thieneman says. “They offer me a lot of technology I can’t offer myself.”
Other advantages include the broker’s ability to design ads and brochures, promote Thieneman’s homes on TV, radio, newspapers and the Internet and staff multiple developments simultaneously on evenings and weekends.
Thieneman also says he values the broker’s integrity, respect and belief in his company’s product. “I need to believe,” he says, “that they understand that while we all need to make a living, the most important aspect of our job is that we get the right buyer into the right home.”
Specs and Scale
Thieneman’s broker is Dave Parks, owner of Berkshire Hathaway Home Services and Parks & Weisberg, Realtors, also in Louisville.
Parks says his company represents several builders on an exclusive basis, giving him a unique perspective and a large enough scale to offer the builders a marketing reach beyond what they could achieve alone.
“I have one corner of the front page of the real estate section dedicated to new construction every week, 52 weeks a year,” Parks says. “You can’t buy that ad space for one builder at any price and make it make sense.”
Parks also helps builders offer proposed or spec houses through the local multiple-listing service (MLS), allowing them to test market floor plans and concepts to prospective buyers. He’s also helping one builder design a menu-pricing system for new-construction homes.
The focus on builder relationships “gives our agents a base of business that allows us to attract very good talent,” Parks says. “In this business, it’s all about talent.”
The commitment doesn’t always pay off when new-home sales are slim, but when Parks’ agents sell 200 or 300 newly built homes in a year, “it gets to be pretty profitable,” he says.
Differentiation and Communication
Vince Leisey, broker/owner of Berkshire Hathaway Home Services Ambassador Real Estate in Omaha, Neb., says he hasn’t scaled up his business with builders. But some of them have reached out to him nonetheless as his company’s market share at their sweet spot in terms of price has grown.
“It doesn’t take a brain surgeon to drive through the suburbs and see who has signs out,” Leisey says. “We’re taking a bigger piece of that upper-end market, which is attractive to builders.”
The nexus between price points, for-sale signs, builders and brokers suggests that brokers can attract builders’ business by creating a marketing strategy that emphasizes the broker’s differentiation in the marketplace, Leisey explains.
“If you’re a broker, you need to say, ‘Here are the things I do,’ ” Leisey says. “You have the highest average sales price. You do the most business in a certain area. What is the value that you add to the builder to create additional interest and activity, drive more people to the property and make the property more marketable so the builder can get it sold sooner and for as much as possible?”
Leisey also takes an interest in the relationships his sales agents have established with local builders, acting as a sounding board and mediator to help set expectations, manage learning curves and mediate the inevitable misunderstandings.
“If there are struggles, which there are going to be,” Leisey says, “I will say, ‘Please call me and let me be that disinterested third-party that explains each person’s point of view to the other person.’ ”
With all these avenues to pursue, builders can become an important component of any broker’s business.
Marcie Geffner is an award-winning freelance reporter, book editor and blogger whose work has been published by a long list of financial, mortgage and banking websites, trade magazines and newspapers.
She holds a bachelor’s degree in English with high honors from UCLA and a master’s degree in business administration (MBA) from Pepperdine University and has completed advanced novel-writing courses at the UCLA Extension Writers’ Program. She is a second-generation native and lifelong resident of Los Angeles.