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You Get What You Pay For!

By
Services for Real Estate Pros with Classic Property Management

   How many times have you heard that before?  I would hazard a guess and say that pretty much everyone who reads this blog has heard that phrase at some point in their lives.  Do you believe it?  For me, it depends on the situation. 

   For example, several years ago there was a craze over little bean bags shaped like animals.  Does anyone remember that?  That's right, the Beanie Baby craze.  At the height of this madness, people were willing to pay literally thousands of dollars for these little bean bags that cost their manufacturer mere cents to make.  Today, those people must be living in self loathing that I can not even begin to fathom.  These same Beanies can now be purchased by the box full at garage sales for less than one dollar.  

   So let me ask you.  Did these people get what they paid for?  I wouldn't say so.  Those little critters are still the same bags of beans that they were before, but suddenly, they are now worth a tiny fraction of what they once were.  We have all heard of someone being upside down on a home, a car, or other investments, but a bean bag??  Come on.

    Now let's take a peak at another situation.  Let's say that I can either buy a home made car from my cousin, or I can buy a BMW.  Obviously, there would be no comparison.  The additional cost that I would incur to acquire the BMW would be money well spent.  My cousin has no idea how to build a car.  BMW has been doing it successfully for many years.  It is that kind of knowledge and success that causes people to spend their money at BMW instead of my cousins house!  I could bring all the parts of a BMW to my cousin and ask him to put it together for me.  Would that be money well spent?  NO!  The monstrosity that would result from that little experiment would be lucky to function, much less emulate the BMW that it could have been.

   So how does this apply to Real Estate?  Basically, whether you are a property management company or a Realtor, you should be the BMW.  People should be coming to you because the money that they spend on you and your services is money well spent.  Here in the Antelope Valley, there are a lot of people who do business like my cousin builds cars.  They have the same materials to work with, but they have no idea what they are doing.  As a result, their homes don't sell and their rentals stay vacant.

    We recently took over management for an owner who had a home here in Palmdale.  They were using a different company that placed a tenant without doing their homework.  The company eventually went out of business, leaving the owner to deal with the mess they left behind.  The tenant ended up living in the home for about four months without paying any rent before we took over (a total loss of over $5,000 for the owner).  Did they get what they paid for?  No.

   For those of you who may be reading this blog, please take the time to find out about the person or company that you are relying on for your home's well being.  You should not make your decision based solely on the initial cost to you.  In the end, the wrong Realtor or property management guy could cost you infinitely more than you can imagine.

 

 For more ways to get what you pay for, or for more solutions to today's rental market, please check out our website by clicking on the Classic logo to the right!

 

Joseph Lang
Pillar To Post Professional Home Inspection - Rancho Cucamonga, CA
Home Inspector, Southern California
There are some things in life you can get a deal on and there are others that you simply get what you pay for.  You usually get what you pay for when dealing with the service industries... when will people learn?
Feb 21, 2008 02:23 PM
Lanre-"THE REAL ESTATE FARMER" Folayan
Samson Properties - Bowie, MD
I don't make promises.I deliver results.SOLD HOMES

I defintely agree with. You do get what you pay for. So if you feel like what you paid for something that you know you shouldn't have paid for,you have no one to blame but yourself. I was never into the Beanie Babies. But that was just me. Great post.

Feb 21, 2008 02:24 PM
Ruthmarie Hicks
Keller Williams NY Realty - 120 Bloomingdale Road #101, White Plains NY 10605 - White Plains, NY
Love the analogies. In real estate you generally do get what you paid for - but I have seen a few full service people treat clients like a discounter would.  Therein lies the problem!  If people feel they might get substandard service from a full-service brokerage, it pushes them towards discounters. A few bad apples reflect poorly on us all. 
Feb 21, 2008 02:57 PM
Joe Hayden Real Estate Team
RE/MAX Properties East - Louisville, KY
Your Louisville Real Estate Experts!

I would argue that the client you acquired probably got exactly what they paid for...;)

The question is, did they deserve it?  Of course no!

Luckily for them, you are going to treat them by the Golden Rule...

Feb 21, 2008 03:16 PM
Audrey Hoffman
VoteAudrey blog - Columbia, SC
VoteAudrey

Great analogies.  It's all about the ROI...clearly your new client got a really poor one.  Glad to hear they are able to depend on you and move on from their negative experience with the other "company."

All the best,

Audrey 

Feb 21, 2008 03:50 PM
Bob & Carolin Benjamin
Benjamin Realty LLC - Gold Canyon, AZ
East Phoenix Arizona Homes
Great comparison. There are a lot of beanie babies in attics across america I am sure.
Feb 21, 2008 04:49 PM
Monica Bourgeau
Portland, OR
Authentic Marketing for Heart-Led Agents
Great examples, you definitely do get what you pay for, especially in real estate.
Feb 21, 2008 09:16 PM
Laurie Mindnich
Centennial, CO
Whether you are paying more, or less, understanding exactly where dollars are going, and for what, is essential in todays market.  Great post!
Feb 21, 2008 10:15 PM
Christina Moock
Cutler Real Estate - Canton, OH
REALTOR - Cutler Real Estate
I remember waiting in line to buy my beanie babies... what were we thinking???  You bring up some good points, do your research and investigate.
Feb 21, 2008 11:00 PM
Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

 

It goes directly to "branding." Is your brand one that people will recognize and respect, or are you just one of many attempting to get their business. If you go the extra mile for your clients and combine that with adequate branding, the business will come to you!

Feb 21, 2008 11:15 PM
Ted Baker
Carmody and Associates LLC - Winter Haven, FL
MidFloridaMediation.com

Actually, Jonathan, you may or may not get what you pay for - but you will certainly pay for what you get.

 

I enjoyed your post and comments 

Feb 22, 2008 12:36 AM
Lorraine or Loretta Kratz
Crescent Moon Realty, Inc. & Land N Sea Auctions. - San Marcos, CA
Certified Negotiation Consultants

Jonathan:

Like life beauty is in the eye of the beholder. So, it is with anything in life.

Lorraine

Feb 22, 2008 12:53 AM
R. B. "Bob" Mitchell - Loan Officer Raleigh/Durham
Bank of England (NMLS#418481) - Raleigh, NC
Bob Mitchell (NMLS#1046286)

"You Get What You Pay For" is one of those bits of conventional wisdom that just doesn't hold true!  As you pointed out, there were lots of people who bought those beanie babies for big time money only to find out that what they bought really wasn't worth it.

Examples of things costing more that they should abound in our society.  Diamonds for example.  In reality they are at best a semi-precious stone, but because of market manipulation and extensive marketing, people "believe" them to have a value higher than it probably should have.

Being a discount real estate company I have other agents use this line all the time when they are attempting to justify why they are so much more expensive than I am.  I respond to this by asking the question, "Why should it cost 3 times as much to sell a $300,000 home than it does a $100,000 dollar home?  Is there 3 times as much work involved?  3 out of 4 times the seller's see my point.  

Having a 13 year track record of success in selling homes with my discount program also helps to sway them my way!

 

Bob Mitchell

ValueList Real Estate Services, Inc. 

Feb 22, 2008 04:32 AM
The Michael Pierce Team
Better Homes & Gardens Kansas City Homes - Leawood, KS
Kansas City Real Estate Experts
I believe you especially get what you pay for in the service areas.  A company can pass a worthless toy off as a collectable for who knows how long but it is hard for someone to provide very poor service for the money and survive in business for very long. 
Feb 22, 2008 04:38 AM
Anonymous
Anonymous
Great Post as everyone seems to think so as well
Feb 22, 2008 04:57 AM
#38
Anonymous
Lynn Kenton, Realty Executives, Ventura
My best response to potential clients who expect me to lower my commission to below market standards is "If another Realtor so easily and willingly cuts their fee, is that the person you want to negotiate the sale of your home?" It usually drives the point home. Also makes a good case for us as professionals working by referral as much as possible!
Feb 22, 2008 08:30 AM
#39
Christy Powers
Keller Williams Coastal Area Partners - Pooler, GA
Pooler, Savannah Real Estate Agent
That was an awesome analogy. One of my relatives loved to work on cars, but he didn't know what he was doing. There were always "extra" parts....lol. Gotta love it!
Feb 22, 2008 02:47 PM
Kelly Sibilsky
Licensed Through Referral Connection, LTD. - Lake Zurich, IL

This is one of those things that we all know to be true. Good job!

Feb 23, 2008 01:37 AM
Todd Clark - Retired
eXp Realty LLC - Tigard, OR
Principle Broker Oregon

Talk about an awesome post and I could not have said it better myself! It is amazing that people hire based on how much they can save when in the end it always seems to cost them more!

It was really nice talking to you yesterday on the phone and look forward to talking to you again in the future, hope your writers block ends soon!

Feb 27, 2008 05:06 PM
Brian Kreick
Willinger Real Estate - Wenatchee, WA
You do get what you pay for.  When I do business on my own investments in other areas, I don't ask for a discount and I don't ask for a referral fee on a purchase or sale of a property.  I figure, if the person I am working with knows anything, then they should be worth whatever amount they are charging.
Feb 28, 2008 12:34 AM