About This Episode
It might be the most unique way to build your real estate business: Partner with an agent who’s retiring and take over their business. Sounds pretty simple…but it’s not. Nick Krautter has been on both sides of this kind of transaction, and wrote the book (The Golden Handoff) on buying and selling a real estate business. This week on The Walkthrough™, Nick shares the process for taking over another agent’s business without losing their clients. This is part one of a two-part series.
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Links and Show Notes
- GoldenHandoff.com – Nick’s book website with scripts, emails, and other resources
- City and State Real Estate – Nick’s team site
- Nick Krautter – HomeLight agent profile
- NAR Membership Historic Report (stats mentioned in this episode)
- Join our Facebook mastermind for The Walkthrough™ listeners
- HomeLight’s Agent Resource Center
- Follow and listen to The Walkthrough™: Apple Podcasts/iTunes | Spotify | YouTube
(SPEAKER: Matt McGee, Host)
Matt: There’s a famous military phrase you’ve probably heard. “Old soldiers never die. They just fade away.” General Douglas MacArthur used that line during his retirement speech in 1951, but it’s not his. It comes from an old army ballad. And it’s been used and reused in countless professions since then. “Old actors never die.” “Old rock stars never die.” The idea applies in real estate, too.
Nick: I think what realtors have done forever and still do is just–they kind of slowly phase out.
Matt: That’s the voice of Nick Krautter.
Nick: And the problem with phasing out is if you’ve done $30 million in sales a year for 10 years, and now you’re doing 20 and now you’re doing 10, it’s not like your clients are only doing $10 million in sales. You know, they’re still doing 30. They’re just doing $20 million of that with other agents now.
Matt: What Nick’s saying is if you are phasing out, you’re gonna lose business, but there’s a better way. Sell your business to an agent of your choosing. If you’re not phasing out or retiring, look for an agent who is. Exit strategies are an opportunity, and Nick should know. He’s been doing it since 2010. He literally wrote the book on this. It’s called The Golden Handoff. It’s gotta be one of the most unique ways around to grow your business. Just buy another agent’s business. Only, it’s not that simple.
Nick: And I don’t like to say sell the business. I mean, it’s what you’re doing, but that’s why I use the term, you know, “the retiring agent” and “the adopting agent.” And the thing that’s interesting is, so we’ll talk about this more, I’m sure, but like the whole model is based on a referral agreement. And the whole ethic of the whole thing is based on that you have to really believe in and trust the person you’re referring the business to.
Matt: Today, Nick’s gonna share that model with you–the framework for buying or adopting another agent’s book of business. It’s part one of a two part series. This is the Walkthrough™.
Hello, hello. My name’s Matt McGee, and welcome to The Walkthrough™. This is the show where you’ll learn what’s working right now from the best real estate agents and industry experts in the country. At HomeLight, we believe in real estate agents. We’re here to explore how great agents grow their business, stand out from the crowd, and become irreplaceable.
338,000 realtors left the business between 2007 and 2012 after the great recession and the housing market crashed. That data comes direct from the NAR. Today, there’s talk of another recession coming soon. Most experts don’t expect another housing crash like 15 years ago, but the market is slowing down after two very hot and very intense years. Is it possible that we’ll soon see another exodus of real estate agents? Well, agent burnout is a real thing right now. Even veteran and very successful agents are dealing with fatigue and burnout.
I’d be surprised if you don’t know a good successful agent who hasn’t, at least, thought about retiring or slowing down to some degree. Current circumstances, not withstanding, great agents retire all the time. And as my guest today will tell you, it’s not just retirement that creates opportunity. It could be an agent relocating to another state. It could be an agent wanting to wind down parts of their business. Nick Krautter is the team lead for City and State Real Estate. They’re a small team of five based in Portland, Oregon.
In 2010, when a successful agent at his brokerage was getting out of real estate, Nick saw an opportunity. He made a deal to buy that agent’s book of business. And by the way, he told me it was “incredibly profitable.” Since then, he’s bought five or six other agents’ businesses. Nick developed a framework for how to do this so that it’s a win win for both agents.
He put it all in a book called The Golden Handoff.
The book came out in 2015. A workbook version just came out in 2020. And he’s working on the second edition of the main book right now. He’s hoping that’ll be out by the end of the year. More recently, Nick’s team decided to focus on commercial real estate. So, they sold the residential business to another Portland company called Works Real Estate. So, Nick’s now been on both sides of this–both buying and selling a book of business.
Today’s show is part one of a two-part series. Now, next week, we’re gonna talk about what the agreement, the contract should look like and how all the money works when you do this kind of thing. This week is all about the process. So, today you’ll hear Nick talk about several ways to find agents who might be ready to sell some or all of their business.
We’re gonna talk about due diligence. How to make sure you and the other agent are a good fit. And, we’ll talk about how to take over someone’s business without losing their clients. Nick’s gonna share some scripts and dialogues along the way. We even have like a, I think it’s a three to four minute long role play where I’m the homeowner, and Nick is reaching out to let me know that he just took over my agent’s business. So, you’re gonna hear what that should sound like. All of that is straight ahead. So let’s dive in. This is part one with Nick Krautter.
Nick: But we’re all replaceable. That’s the thing is, I think realtors think that, “Well, no one can do it just like me.” And the answer is no, no one can do it just like you, but they don’t have to. You know, if you disappear tomorrow or quit, throw your phone in the ocean, your clients are all gonna find a way to move. You know, they’re gonna find someone that can help ’em buy and sell. And The Golden Handoff is just a process where you can pick the person that helps, right? You can make sure you’ve got someone hardworking, ethical, experienced that’s helping your clients, uh, after you’re–you know, done with your career and helping them.
Matt: Where I wanna start with the process is the obvious question. How do you find out who might be retiring, who might be getting out of real estate, who might be ready to hand off their book of business?
Nick: The easiest place to go is go to your team leader or your broker, uh–or manager, um–you know, whatever– you know, whatever your company calls it. The person that’s running the brokerage is gonna know who’s coming and going. But, they’re the people that hear about it first. You know, someone that’s like, “Gosh, I’m burned out. I wanna retire, but I don’t know what to do.” Um, or someone that’s like, “Hey, I’m gonna start working part-time, or I’m gonna start working remote.”
And those are really the best opportunities. Cuz you already know that person, probably. You’re already, I mean, I would say before, COVID, you’ve been in the office, and you see each other all the time, and now that’s not so much the case, but it’s gonna be the case again. I mean, people like to be around each other. So, starting with your broker and your own brokerage, where you have relationships. And then, as you, kind of, expand past that, looking around and seeing, gosh, who used to be a superstar that is kind of slowing down? People you see phasing out to have that conversation, um, is really powerful.
And then, um–you know, most MLS’s or brokers will have access to analytics where you can, actually, do a report and say whose business has gone up and whose business has gone down. One thing that’s come up for me that I teach now, that’s not in the book and I want to, uh, I’m gonna be writing a new chapter for, basically, the second edition pretty soon. The book’s been out for, like, seven years now, and I’m, I want to add some more things that I’ve learned along the way. And the big thing I would say is what I call a “partial handoff”. What I’m finding is that most people don’t pick a day, and just retire from real estate. They kind of phase out. And I think the biggest opportunity for you, if you’re looking to adopt clients, is to help those people who are, kind of, phasing out and slowing down.
And the way I phrase it is, “Hey, you’ve earned the right to do the stuff you love and not do the stuff you don’t love. But don’t just, like, throw it away. You know, why don’t–if you don’t wanna work with first time buyers and work on the weekends anymore, I’ll take care of that. Why don’t I help all the first time buyers, and I’ll take care of everything on the weekends? I’ll do the open houses, etc., etc., you know. And you focus on the listings.” That’s, typically, what people want to do to have more control of their time.
Maybe, it’s they only wanna do a certain number of deals a year. Maybe, they only wanna work in a certain price range. Maybe, they’re really strong in a certain neighborhood. You take the stuff in the other neighborhood, and there’s a lot of ways to do it. It’s not just all or nothing. And then, as that person gets closer and closer to being fully retired, then you’re the, you’re obviously the, heir apparent, right? You’ve already been helping them. They already know you. So, those are some ways to get started and start building those–start making connections and, talking to people who you think might be looking to get out.
Matt: So, as you’re scouting potential partners for this kind of arrangement, what kind of due diligence are you doing on them and their business? What are you looking at?
Nick: So, yeah, so if I’m looking to buy the business, ideally they have a database that they’ve kept up. That’s huge because that’s the proof of–that’s really–that’s the only way you know how to touch base with people is they’re in the database, and you’ve got their names and phone number and email and addresses, and it’s–and hopefully, it’s correct. The other thing I look for is what is the percentage of business that’s repeat and referral? You know, where does their business really come from?
When I was in a much bigger office, you know, I was always in the top three, but the guy that was, typically, number one or two or three as well, uh, every month, had a very different business model. It was very much marketing and prospecting. And I remember one day, he was meeting a client, uh, at our office, and they were late. And I was, kinda, leaving. It was after hours, and we were just talking, and I was asking him, I said, “I’m curious. What percentage of your business is repeat and referral?” And he is like, “Oh, it’s about 5%. But I’m gonna hire a sales agent to make calls with those people to try to get more referrals.” I’m like, “Oh wow.” I don’t like, that’s not really how it works. Super successful, like great business man, uh, great team, you know, very well respected, but totally different business model.
Matt: That was a red flag for you.
Nick: Yeah. Because, how much relationship value does he have, right, with those people, if they’re not coming back and working with him?
Nick: And they’re not referring. Uh, you know, his business was very, very good about getting new leads in the door and getting them closed. But, there was not a lot of trying to build relationships and maintain relationships long term. But yeah, to me, it’s a red flag. The higher the repeat and referral percentages, I think that the more values you’re gonna have in that, in them referring you and their endorsement.
Matt: So at some point, just from a logistical angle here, at some point, you and the other agent, the retiring agent–you guys have to get together and, like, sit down in a room and say, “Let me see your business,” basically.
Nick: There’s really like a couple things I like to look at. Is that, look, let’s look at the database. You know, how big is it? How is it organized? The second thing is, I wanna know, hey, in the last two years, do you, are you keeping track of where your business came from? You know, is it referral? Is it new construction? Is it open houses? Is it marketing? Where does your business come from in a given year? And again, repeat and referral is, like, really the gold standard, but it should never be a hundred percent. I think, you know, if it’s 50% or higher, it’s probably a pretty healthy sign that that agent has done a good job taking care of those people. So, those are really the things I look for. Where does your business come from, and how much are you doing? Right?
That’s you know, if you have a database with a thousand people, you do 40 deals a year, you’re doing something wrong, right?
Nick: And if you’re doing 50 deals a year, and you’ve got a hundred people in your database, there’s probably a lot of people, not in your database, so let’s build it up. And the other thing I wanna know is what’s your marketing plan? What do you do? Like, are you calling people? How often are you using social media? Are you doing mailers? Uh, do you do an advertisement in the local paper? Do you do host events? Do you do classes? Like what are you doing to engage with your clients and new clients and to build those relationships? Um, because I wanna know if they have some magic bullet that’s worked for them, you wanna make sure you keep doing it.
And you also wanna make sure that your marketing plans match up pretty well. They don’t have to be identical, but here’s an example. If you, if you were someone that you had a client party, and you call your clients a couple times a year. And you really do deep relationship with people. And you’ve got an agent that wants to adopt your clients, but they only do social media. They don’t meet in person, and they don’t call anyone. It’s probably not the right fit because your clients are gonna expect a different form of communication.
Matt: We’ve been talking about how to find agents who might be slowing down or retiring. And how do you make sure it’s a good fit? Well, let’s say you’ve got that locked down. You’re gonna buy or sell a book of business. At this point, you really have to get the communication right in order to migrate the retiring agent’s clients to the adopting agent. Nick is gonna talk about what the various letters, calls and emails should say. And we’re even gonna do a short role play soon. If you wanna get copies of this communication, you’ll find most of it in the book. And there’s also some more available if you register on Nick’s website It’s goldenhandoff.com. I’ll put that link in our show notes today. For now, let’s get back to the conversation. Nick is about to walk us through how the handoff happens.
Nick: So, there’s a very specific process that we use that works really well. And it’s not complicated, but you wanna do it in order. So, once you’ve got your adopting retirement agent, have met up, they wanna work together. They’ve looked at the database. They’ve looked at their marketing plans. They’ve signed a contract to work together.
Then, the next step is that I ask the retire agent, “Hey, your top, top people, your A+ people–I want you to call them, and just let them know, personally, whether that’s 10 people or 50 people, whatever it is. It isn’t everyone. Just your, core, core group. Call and let ’em know, “Hey, I’m gonna be–I’m, I’m retiring from the business, but I wanted to make sure you had a great agent to help you. And so, I’ve connected with Nick, and he’s gonna take great care of you’ve known him for 10 years. He’s amazing. He’ll be calling you and following up and touching base. And, you know, let me know if you have any questions or needs, but you’re in good hands.”
Then, we send a letter from the retiring agent. Now, I do it as the adopting agent. I do it, and pay for it. But, it’s on their letterhead, and it’s their return address. Because I want their clients to know it’s coming from the agent. They know, right? This is–this is not a marketing piece. This is an announcement from their agent. It has both of our information in it, and it basically says, “Hey, I’m retiring from real estate, moving to Florida. I’m gonna fish and laying the sun, but I wanted to make sure you had a great agent. Nick’s gonna help you. He’s awesome. Here’s a little bit about him and his team. And he’s gonna be calling you and touching base, and you’re gonna be getting his updates and emails and newsletters going forward.
And you’re in great hands. Thank you so much for all your business and support.”
And then, it has my information in there, is on the bottom. So, they have my name and number. Uh, what happens next, then, is once those letters go out, we email it to everyone from the retiring agent. Same–it’s the same exact letter, same thing. And now, what I’m doing to add to this is adding some video on social media. So, when we did our partnership with Works Real Estate, we had a scheduled Instagram live, that we did. Me and Darby, kind of, sitting just like you and me, side by side, talking like this about “Here’s what’s happening. Here’s why we partnered together. And here’s what, um, we’re gonna be doing for you guys in the future. Um, because we’re still here, we’re still in business. We’re just helping on investment and commercial and development.
And they’re helping when you need to buy or sell a house or a condo or, um, something like that.” So, uh, we added–we’re doing that. I love the idea of using video, which you can email directly. You could send links, you can do on social media. It’s just another way to reach people. If they don’t, you know, not everyone opens all their mail. People don’t listen to their voicemail. So, now that you’ve done your announcement in a email, uh, in a letter, you’ve done some social media announcements. And then now the adopting agent’s calling. And so Matt, let’s just, I’ll pretend you’re in Renee’s database, and I’m calling you for the first time. And I’ll–we’ll–this is a perfect time to do the script.
Matt: So, Renee was my agent, and you’re now adopting Renee’s business?
Nick: Yeah. And Renee, you’re one of her top clients though, Renee called you and said, “Hey, I’m retiring and moving to the, to Florida. ”
Nick: “And I’ve got this great guy, Nick, and you got a letter and the email and you saw something on Facebook.” And they’re, like, and now you’re having lunch. And the phone rings, and you pick up.
Matt: Alright. Hi, this is Matt.
Nick: Matt. Hey, this is Nick Krautter with City and State Real Estate. How are you doing?
Matt: Uh, I’m doing well, Nick, how are you?
Nick: Good. Hey, I promised Renee, I’d give you a call and check in and see if you had any real estate questions or needs I could help with.
Matt: I don’t right now, Nick. But I’ve–think I, didn’t–I saw your name on something, didn’t I?
Nick: Yeah. You know, we’re, Renee’s retiring, and we’re gonna be here to help you in the future if you need anything. Uh, we’re uh, you know, helping all of her clients, I’m really excited. She’s got wonderful clients. They’ve all been really happy with her, and I’m really excited to, to meet you and her other folks she’s helped and, and be of service in the future.
Matt: Well, Nick, I gotta tell you, we loved Renee. She was awesome for us. How can, how do we know that you’re as good as she is?
Nick: [laughs] Well, you know, the reason she did such a great job for you is the same reason why she was really diligent in finding an agent to help in the future. And so, I know Renee interviewed about five different people before she decided to work with us to, to help you and other clients like you. And, um, you know, she really cares about you getting good service and that’s why we’re working together.
Matt: We were, we have a, a neighbor down the street, Nick, that is a real estate agent that we’ve, we’ve talked to before and are friends with, but we loved Renee so much. We were thinking about, uh, you know, taking our business to them.
Oh, okay. Well, you know, I’ve, I think it’s great to interview as many people as you want. Um, you know, what we do for our clients is provide the same level of service that you loved with Renee. And I would love the opportunity to meet with you and, and show you that. It sounds like you’re planning to make a move, if you’re talking to another agent.
Matt: Well, we, I mean–we we’ve–you know, we see them at, at, you know, community events and you know, when we’re out walking dogs and all that sort of stuff. We’re not actually, Nick–you know, we’ve talked about maybe a few years from now, we might wanna sell the house, but we’re, you know, it’s not anytime soon.
Nick: Well, that’s exciting where you, uh, where are you hoping to move to next? Where are you? What’s drawing ya to make that decision?
Matt: Yeah, probably just down, probably stay in the area. Might just be downsizing. Kids are getting outta college soon. So…
Nick: Nice. Congratulations. Well, would you be, would you be offended if I found some great, smaller, like single level downsized homes that are in your neighborhood and just kept you updated on what’s out there? And would be happy to show you something and see what it might feel like to have a little bit less space to clean and, and manage?
Matt: Yeah, I mean, I, I think it might be a little too early for us, but you know, if you see something and you wanna send it to us, that’d be fine.
Nick: Cool. Well, you know, one thing I wanna let you know is, you know, I know it sounds like, you know, you hear there’s no inventory out there, but, uh, there’s actually 3000 houses on the market right now. Um, and the average house is taken about three weeks to sell. Not everything’s selling in one day with 20 offers. So, keep that in mind. This is kind of a quick market update.
And you know, what happens next is I’ll stay in touch and, uh, we’d love the opportunity to help you when you’re ready. You’ll get my newsletter and our email, we do market update. So, you know, whether you’re thinking moving today, or in two years, you can keep up on the market. And, uh, you know, I appreciate you taking my call. Before I let you go, though, I have to ask. Who do you know that might be looking to buy or sell that I could be of service to?
Matt: Wow. I don’t, I don’t know anyone right now, Nick. Um, but I’ll, certainly, if I hear of any of the neighbors will let you know for sure.
Nick: Awesome. You know, whenever I’m trying to remember something, it usually comes to me tomorrow in the shower.
Matt: Yeah, totally.
Nick: And if you, if you think of someone, just send me an email or a text and introduce me. And we’ll take it from there and take great care of ’em for you.
Matt: That sounds great. Great to meet you, Nick. Nick, thank you.
Nick: All right. Great talking to you. Well, yeah, so I like that you, you got a little harder on me there.
Matt: I did. So, in that, so in that role play, I was trying to be, trying, you know, “Well, I’ve got some other options, Nick.” But what is that conversation usually like? Is the, is the client, usually like, really glad to hear from you? And they’re like trusting of you because of the connection with Renee and the communication that’s already been done?
Nick: Yeah. I would say, usually, the people you talk to it’s–it’s pretty warm. I mean, people do know other agents. And that, that can come up. You know, usually the script, I kind of, pivoted into it towards the end there, but people, usually, have a question or need and wanna schedule an appointment. That’s probably one outta 10 people. You know, you might get lucky and they wanna do something right now. And that’s easy. You just set the appointment, and you do a buyer consult or a listing presentation.
One out of 10 people is gonna probably do something in the first year. Right. That’s, generally, about the turnover rate for people–move about every 10 years. So, but for the nine outta 10 people that go, “Hey, thanks for calling. This is great, but I don’t need anything,” there’s a couple, there’s really, there’s three pieces of the script.
The first one is your introduction. And it–this is important to understand why it’s structured this way. So, you know, Matt, I said, “Hey, I’m calling cuz, uh, I promised Renee that I would call you and check in and see if you have any questions or needs.”
Nick: So, what you’re doing there is you’re connecting yourself with a retiring agent who likes–that you like, and you’re also establishing character. Cuz you’ve gotten an email saying, I’m gonna call, you’ve gotten a letter saying, I’m call. Renee, talked to you and said, I was gonna call and check in, and now I’m calling. And I’m keeping a promise to someone you like. So it’s, “I promised Renee, I would give you a call.”
Matt: So you’re reliable?
Nick: Reliable, trustworthy, good character. So you’re establishing that early, right? You always wanna establish character and competence as early as you can when you’re building your relationships. Character is you have it or you don’t, but there’s different ways to, kind of, show it. And that’s one–is keeping a promise to someone you like. The second piece of it is just to check in and see if you had any real estate questions or needs I can help with. Not, “I’m calling to see if you have a referral or wanna sell your house.” Right?
You’re–you’re calling to see how can I serve you not, “Hey, I’m gonna call a hundred people today, and I need to get two listings. So, do you wanna sell your house?” It’s–that’s not what you’re doing. The second piece is for those nine outta 10 people that are really happy and love their house. That’s great news. Most of Renee’s clients loved her and loved their house. Let me give you a couple snapshots of what’s going on in the market today. And again, don’t vomit the whole MLS stats page at ’em, but just a couple things like number of homes available, time on market, average price trends.
Those types of things are really valuable. Cause people wanna know what are homes going for? How long is it taking? So, a couple stats establishes your competence that you know about the market. And then, the following thing is you always wanna tell people here’s what happens next. So, “Hey, you’re gonna get, I’m–make sure you check out the emails I send. Make sure you open the letters we mail.” You know, usually you do, you know, if you do events or classes, let ’em know about that. Uh, and then it’s always good to ask for a referral. And again, just a real “Referrals 101”, don’t ask, “Do you know someone?” (yes or no question) You want to ask, “Who do you know?” (open ended question). It works a lot better.
Matt: Let me ask this Nick, in a typical handoff, how many of their clients become yours? Like, do you just assume that some aren’t gonna come along? No matter what?
Nick: I mean, I think that’s smart to assume that. I mean, even with us, for the referral, you know, we’re doing, I know not all those people are gonna work with with the Works Team. I would say again, the higher the repeat and referral percentage, the more likely they are to stick around. I’d say that if you lost 10 or 20% of ’em, I would still feel pretty good about that. Um, and there’s also stuff that’s in there. Like, you know, I know there’s a handful of people we referred that we sold their house, and they moved outta state and, they’re not coming back to Portland. They don’t have any friends or family here, you know–hey, thanks for the great job, but we really don’t need to stay in touch. And so, there’s always an element of that in everyone’s database.
I think, most probably assume that about 10% of the people they know are gonna churn over to someone else or exit the market. They were gonna be a first-time home buyer, and now interest rates are six percent, and they can’t buy. And so, they’re either waiting for a very long time, or they’re just completely like, “We’re gonna move to Kansas City and buy a house there, cause we can’t afford Portland anymore. “There’s always some element of that in real estate.
Matt: After the announcement goes out, and you’ve made the calls, like we just, we did the role play, what happens if, maybe, I don’t get the message, or I didn’t understand, and I keep contacting Renee, right? I’m still in touch with the retiring agent. How do you handle that as the adopting agent?
Nick: You, you touched on something that happens a lot, too, where the retiring agent has trouble letting go, and they try to do too much, still. So, that client calls Renee and says, “Oh, we wanna sell our house. Can you come look at it?” And she goes, “Sure. I’d love to look at it, and see you guys and see the kids.” But what you really want to do is you really want to keep reinforcing and re-endorsing the agent. And that’s actually in the contract is that they continue to re-endorse you as needed.
Because what happens is when the retiring agent is–is not doing it, they’re–they’re not sharp anymore, right? They don’t have the stats of what’s happening right now, and they’re not running a business anymore. I’ve had it happen a lot where retirement agents do too much. And then by the time I show up, they’ve, kind of, blown it because the person’s talking to another agent that’s full business mode and shows up on time and is following up really hard cause they wanna get the deal.
So, usually what I ask is just, “Hey, let me know.” I’ll ask Renee, “Hey, if someone calls you, please let me know right away. Um, let them know, ‘Hey, I’m not doing that anymore, but Nick’s gonna call you and listen, I trust him.'” And every once in a while, I’ll need the retiring agent to say–like, look at my CMA and say–“Yes, I really agree with their valuation.” Or the, the client wants to, to hear from the retirees that my marketing plan’s gonna work. So, every once in a while, you need them to, kind of, give you a–another, like, five star review, or high five, or endorsement to that person. It’s rare, but every once in a while, you need that. But, otherwise, you want to make sure that the adopting agent–me–that I’m the one setting the appointment and getting there as quick as possible and doing my job.
(Matt: Hi, this is Matt McGee. HomeLight Settlement provides modern title and escrow services to simplify your closing. Our dedicated escrow officers ensure your clients have a seamless closing every time. Contact your HomeLight agent experience team, or go to homelight.com/agents. After you sign up to use our settlement services, a HomeLight rep will be in touch to help you get started. HomeLight Settlement is currently available in select states and will expand to more states in the future.)
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Matt: So, there you have it. All about the process of buying a retiring agent’s book of business. And that’s just part one with Nick Krautter. Next week, we’re gonna talk about the contract and the financials. I’ll have a preview of that in just a moment.
What you heard us talk about today, and what you’ll hear next week in part two is just a sample of the scripts and dialogues that Nick shares in his book. You can learn more about that on the book’s website. It’s goldenhandoff.com. Two words combined, no hyphens or anything. Goldenhandoff.com. I’ll link to the site in today’s show notes. Thanks so much, Nick. Great, great start to our two-part series.
It’s time for our Takeaways segment. Here’s what stood out to me from part one with Nick Krautter about buying or selling a retiring agent’s business. And I’m gonna come at this from the angle that you’re an agent looking to buy another agent’s business, to adopt their clients.
Takeaway number one: How do you find agents who might be retiring? Well, your broker or whoever runs your office is a great place to start. Nick also says your MLS might have a way to run some reports that would tell you which agents are slowing down and not as productive as they used to be.
That leads us into takeaway number two: Don’t just focus on retiring agents. Nick talked about a partial handoff where, maybe, you find an agent who only wants to work with sellers. So, you take over their buyers. Or maybe they only want to work in a certain price range. As they phase out, you become the, heir apparent for when they eventually retire.
Take away number three: Once you find a possible partner, you have to do some due diligence. You have to sit down together, and make sure it’s a good fit. Nick says, the first thing he wants to look at is their database. Is it current? How big is it? After that, you wanna find out how much of their business is repeat and referral. Nick doesn’t want this to be 100%, but above 50% will be good for you as the adopting agent. Nick also talked about the importance of making sure your marketing and communication are similar to the retiring agents. It needs to be a good fit, so you can connect with the adopted clients.
Take away number four: There’s a very specific process for making the announcement that you’re taking over the other agent’s book of business. Too much to fully recap here. But, Nick suggests you follow it in order. It starts with the retiring agent making phone calls to their core group of top clients–their A List. And then it goes on from there. This is the handoff process. We did a role play where Nick shared his script for telling me that he had bought my agent’s business and was gonna be my new real estate agent. The whole idea here is to make it as likely as possible that the retiring agent’s clients will stick with you. And those are my takeaways from part one with Nick Krautter.
Next week, in part two, we’re gonna focus on the financial agreement between the retiring agent and the adopting or buying agent. We’ll talk about what the contract should look like. For example, Nick says the contract should spell out how active the retiring agent will be after the handoff. Here’s a sneak peek of that.
Nick: As a rule of thumb, the more engaged and helpful and supportive the retiring agent is in helping you and bringing more value to that client list and adding people to it–keep paying ’em for that. I mean, my dream scenario is that they’re helping me do more. I would much rather pay 25% forever and have 10 new clients a year that I wasn’t gonna get than get a hundred percent of a database that is limited.
Matt: So, that’s a preview of what’s coming up next week in part two. If you have any questions or feedback about what you’ve heard so far or what you heard today in part one, there’s a couple different ways you can get in touch. Leave me a voicemail or send a text. The number to use is 415-322-3328. You can send an email to walkthrough[at]homelight.com. Or you can find me in our Facebook mastermind group. Go to Facebook, do a search for HomeLight Walkthrough™, and the group should come right up.
That’s all for this week. Thanks again to Nick Krautter for joining me, and thank you for listening. My name’s Matt McGee, and you’ve been listening to The Walkthrough™. At HomeLight, we believe in real estate agents. We’re here to explore how great agents grow their business, stand out from the crowd, and become irreplaceable. Go out and sell some homes. I’ll talk to you again next week. Bye bye.
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