Inman Park Realty was created as a project for agents considering DBA (Doing Business As) branding. Our intention was to build Inman Park Realty from scratch and document the process so other agents could see for themselves how to create their own DBA companies. As a DBA experiment, IPR didn’t generate the interest we had hoped for. But, it did set in motion the process to extend the Inman Park Realty experiment into areas that have yet to be tried.
The idea was to create the perfect real estate incubator. The challenge: upgrade the experience for both buyers and sellers while becoming a true value-added service to the community. Given this, our first thought was; whom should we seek advice from? History says, ask a realtor. But, many would argue that should be the last person to engage. Self-interested lot realtors are. Remember, it’s 2017. Any process or person looking to change the real estate experience must first look to include the advice and expertise of the Social Media community.
Taking stock of what we created for the IPR branding project made us realize its electronic value. The website, www.InmanParkRealty.com, was getting activity. The Facebook page, /InmanParkRealty, and Twitter, @InmanParkRealty, account continued to gain friends and followers. The brand of Inman Park proved to be so strong within the Atlanta community, our platforms were connecting with users on a social level by simply being electronically associated by name.
The first version of Inman Park Realty lacked a true real estate end game. We were testing how well branding would do and paid little attention to ongoing development. To continue the IPR experiment, we needed to address the missing element. We have a well-defined sales area with communications platforms in place. The only thing missing in this sales channel was the agreement between the parties involved. And, this is where the IPR experiment takes a significant turn away from the traditional real estate format.
The public has wanted a flat fee agent commission structure for decades. And to be fair, providing flat fee services on a scattered piecemeal basis is a nearly an impossible business model for an agent to execute. But, if flat-fee pricing is the consumer’s “must have”, there really isn’t any way to provide such services without being in a well-defined sales area armed with today’s social tools and platforms. In other words, if anyone ever wanted to provide flat-fee services in any serious way, they would need to create exactly what we had already created with IPR.
Inman Park, Atlanta’s first planned suburban community, 1890, is now considered a small, highly respected, in-town enclave. For perspective, Inman Park had just over 92 MLS sales transactions last year totally more than $40M in homes sales. Statistics from FSBO sales are not available. If you apply an industry standard 6% commission rate for area sales in 2016, ex-Inman Park homeowners paid over $2.4M in agent commissions. Now it is true, 6% was not paid across the board. Some paid much less. But, it is nearly impossible to see a scenario where anything less than $2M dollars being paid out in agent commissions.
Considering the averages; the price of a detached home in Inman Park, with a traditional 6% listing commission, costs the homeowner over $38K in agent commissions. Care to guess how many days on market Inman Park detached homes averaged in 2016? Twenty two. Yes, it took 22 days, on average, to sell a detached home in Inman Park and the homeowners still had to pay, on average, over $38K in agent commissions. This is impossible to justify. The starting salary of an Atlanta City Policemen, who works for a full 12 month period, is less than the money agents received for their part in the average 22 day Inman Park sales cycle... People don’t begrudge others for making a living. People do have a problem when the optics are so wildly askew they feel the victim.
Traditionalists will be quick to point out an agent’s work is much more than just the, 22 “on market” days. This is very true. But, homeowners are equally quick to point out, the expense of an agent’s business model is of no concern to them. Additionally, with an average days on market of 22, homeowners should have a difficult time in understanding “why” they need to pay 3% to “protect” the buyer’s agent. Selling the fear of agents not showing a property because it’s unprotected may be true in some areas, but it shouldn’t be for Inman Park. Being in a high demand, branded area, means the consumer comes to you. It’s not like anyone in Atlanta will ever say; “I never knew of Inman Park until my agent told me”.
Inman Park Realty will be a flat-fee service for the homeowners of Inman Park. It will be the same fee regardless of home type or sales price. The fee will include traditional services such as yard signs, lock boxes, and dedicated sales agent support. Listings will be published on FMLS, GAMLS, Facebook, Instagram, Twitter, YouTube and other platforms as they become available. All homeowners will receive log-in access to the Inman Park Realty Social platforms to encourage participation and direct engagement. Additional communications platform support, beyond the MLS, will allow for unique custom home presentations and interactive capabilities.
In short, the IPR incubator will mirror what homeowners have long been asking for. Can it be successful? Statistics say it has a good chance. But, statistics, like Presidential polling, isn’t always a guarantee. Success or failure will ultimately be on the agent who is executing the plan. Still, a great plan poorly executed, just might be better than a bad plan, (6% listing fees) perfectly executed (6% listing fees).