The Paperless Real Estate Agent – Time is Money
Right? Your time, as a Real Estate Agent is worth something isn’t it? If you don’t think it is then maybe you should be working for someone other than yourself.
If you think that running that offer over to your clients for signing and initials isn’t costing you something then perhaps your math is wrong. What do I mean? Well, do you pay yourself an hourly wage? Like most REALTORS® I would suspect your answer is No.
Most Agents take their commission checks, pay their bills, put a portion into retirement funds or into the stock market and the rest goes in their pocket or into a savings account. I would suggest that there are very few Agents that truly know their true worth, being, what they could potentially charge on an hourly basis.
How Do I do That?
It’s pretty simple really. I would look at your GCI, or your Gross Commission Income from 2013 and subtract all your expenses and then your tax. Then you need to estimate how many hours you worked per week multiply that by 26 weeks and divide that number into your Net Income Amount.
Example: $150,000 After tax and Expenses Net Income DIVIDED BY 50 hours/week X 26weeks = $115.38/hr
Now you would have to determine how many hours are spent driving offers back and forth across your city. How many times you had to make a trip to a clients house to get signatures then drive to the office to fax or scan and email.
Back when I was still using paper, pre 2010, and even after I started using my iPad I was having to go to the clients home, typically around 9:00, 10:00 there were times when it was even after 11:00pm, to get initials and signatures.
Now, did my iPad make it easier on me? Sure, all I had to do was email the docs once I had them signed which was a plus. However if I had to drive to Evergreen in the deep south end of Calgary that was close to an hour one way spent driving and one hour one way spent away from my family.
This is Where the Money Comes In
Going paperless in your real estate business isn’t about being techie. Being a paperless real estate agent isn’t about impressing clients or other Agents.
It is about being efficient within your business and it is about ultimately saving time which in turn saves you money.
So let’s use all the numbers we have above to figure out how much an average agent might save over the course of 12 months.
In the Calgary market the average commission is somewhere around $7000. In order to come out with a net income of around $150,000 the agent would have to do about $200,000 in GCI, which means that agent would have to do close to 30 transactions.
If we safely assume that the Agent is going to be spending up to 4 hours on each transaction getting signatures and multiply that by 30 we come up with 120 hours spent on getting initials and signatures.
We now have 120 hours and we can multiply that by our per hour wage of $115.38. We come up with a $13,845.60 spent on driving around the city to do the things you could do from the comfort of your office or your own home.
That number could be better spent on marketing, advertising or taking your A+ clients out for lunches to generate referral business.
That’s just our 2 cent….er…$1,384,560 Cents!