As we mention in our cover story, there are many ways in which relocation real estate differs from the traditional buying and selling process, but there’s perhaps no bigger difference than the presence of relocation companies, which operate as the eyes and ears of the relocating employee’s corporation. To get a firmer grasp on how relocation companies work – and how agents can most efficiently work with them – we spoke with Brian Fudenberg, the vice president of business development with Plus Relocation Services, who shared with us the following details:
1. How Relo Companies Refer Their Business – Relocation referrals follow a very simple process: first, the relocation company receives its customer – the relocating employee – from its client, the corporation; then, they contact a brokerage and offer them the real estate business of that employee. How do relocation companies, though, settle on what brokerage to bring their business to?
There are two methods, Fudenberg explains, for how relo companies go about doing that. One method involves networks, in which relo companies have contractor brokers who get first dibs on their referrals. The second method, which is the one that Plus Relocation ascribes to, is where the relo company is independent of a network, and instead refers business to brokerages based on things like market share, expertise and the quality of the brokerage’s relocation department.
2. Choosing Which Brokerage and Agent to Work With – Plus Relocation does not limit its solicitations to a single brokerage. Instead, they contact two brokerages, and ask them to recommend an agent from their relocation team. Then, the chosen agents apply for the relocation business. They send Plus Relocation a broker’s market analysis, or BMA (essentially a CMA written to the company’s specifications); they submit marketing plans and other details that they feel distinguishes them from the competition; and finally, they interview with a home sale counselor in the company. Plus Relocation then reviews the documents and consults with the transferring employee on which of the two agents is best for the transaction.
3. What Relo Companies Provide the Brokerage – Once the relo company partners with a brokerage and agent, they offer detailed information about not only the listing, but also the buying/selling timeframe (based on the employee’s relocation schedule) and some of the personality traits and requests of the transferring employee. They provide the information, Fudenberg says, as early in the process as they can.
4.What Relo Companies Look For in Agents – When agents interview with Plus Relocation for their business, Fudenberg says the company is primarily looking at the agent’s experience in not just relocation, but in the overall real estate market, as well as any certifications they may have. As we mention in our cover story, the CRP designation is not required to practice relocation real estate, but Fudenberg says it does show a certain initiative on the agent’s part. “It’s a body of work. It’s a commitment to the business. It’s advanced education,” Fudenberg says. “It certainly doesn’t tell all about the quality of the person, but it also does not detract from their professionalism.”
5. What Relo Companies Want From Agents– So, you’ve received a relocation referral and are now working on selling that transferee’s home. What now? What kinds of things does the relo company need from you? Thankfully, those things will be spelled out quite clearly by the relocation company. For Plus Relocation, Fudenberg says their guidelines include when market reports must be submitted and what kinds of photos should be taken. The trick, he adds, is for the agent to work with the relo company. “They can work fast with us by being part of the process and by agreeing to the requirements that we’ve put in place, because those requirements generally help us create success.”
6. A Relo Company’s Services Will Fluctuate – Relo companies, Fudenberg says, provide a similar scope of services, but the specific offerings to a transferee will depend upon what benefits the corporation has approved. Those benefits, he adds, can stem from four things: the industry the corporation is a part of (energy companies, for instance, are generous with their packages); the unique culture of that corporation; the talent of the particular employee, and the corporation’s efforts to retain their business; or shifting market trends. That latter detail, Fudenberg says, was particularly notable with the nation’s rental market, which is more prominent in relocation than in years past due to economic conditions and Millennial attitudes on homeownership.
7. How Agents Must View a Relocation Transaction – When agents are working in relocation, Fudenberg says, it’s essential that they view the process from the perspective of the transferee’s corporation, aka, the company forking over the money and making the relocation business possible. “The average relocation right now is $91,500,” Fudenberg says. “It’s a major investment. Senior executive moves can cost $200,000 to $500,000 … we always want the agent to look at it from the employee and employer’s perspective. It’s a lot different moving between suburbs in Chicago than it is taking someone from Chicago and moving them to Sarasota, Florida.”
8. How Agents Must View Referral Fees – Finally, there are relo company referral fees, which are the percentage fees that they charge to the agent’s commission at the end of the transaction. Referral fees are quite controversial among agents, but Fudenberg echoed the agents in our cover story in suggesting that for anyone considering relocation real estate, the fees must be looked at as part of the grander scheme. “[Referral fees] need to be viewed as part of your portfolio of business,” Fudenberg says. “You can certainly choose not to have this investment as part of your portfolio, but those fees help support the corporate clients’ relocation program.”