When a market shifts from a sellers’ market to a stable market, and then eventually to a buyers’ market, during those transitions the conversations between salesperson and client change, or at least they should.
During the sellers’ market, when salespeople sold everything they listed, handling the issue of likely selling price wasn’t a priority. Even properties that were listed over market price eventually sold, because the market rose to meet the listed price.
I’ll say that again:
During sellers’ markets, the market often rose to meet the listed price.
In your area, however, times may have changed.
Prices may have levelled out, but in many areas they are falling, and fast. In this current market, the market is no longer rising to catch up to the listed price.
The opposite is the case:
Listed prices must now come down to meet the market.
So, if you want to continue making sales, your conversations with sellers must change.
Price needs more discussion during the listing presentation
Here are three things you might want to add to your listing presentation.
- Evidence. What properties similar to the one you are listing have sold recently? I’m talking about the last month. Older data may no longer be relevant.
- Digital Footprint. The internet has a long memory. Once a property is listed, it leaves a trail. Buyers can look at history of this property, including how long it has been on the market. Properties that remain on the market too long attract bargain hunters and low offers.
- Dangers of listing high and leaving it there. If market prices are falling, the longer a seller holds out for an unachievable price, the lower the price they will eventually receive. This makes sense: if the market falls by 5% over six months, sell now and you get 5% more than if you wait for six months.
Price needs more attention between listing and sale
It doesn’t serve salespeople well to avoid conversations with sellers whose properties are overpriced. You didn’t have to address the issue of overpricing during a sellers’ market, but you do now.
A change in attitude can help. If you find yourself dreading having a conversation with a seller about repositioning the price, change your attitude. Don’t look on this as delivering bad news. Never walk in thinking, ‘They’ll never reduce to that figure”. Instead, look at recommending a reposition of price as helping those sellers achieve their goals, to sell at the highest price in TODAY’S MARKET and to improve their lives. You are giving service, not delivering bad news. Also, you should have set your sellers up for price discussions during your listing presentation.
For many years I have said, ‘It takes a skilled presenter to tell the truth in real estate and still win the business”. And a skilled presenter is what you must be in stable and in buyers’ markets.
Always remember that you are not responsible for the market; you are merely reporting on it to your sellers. Sellers need to be told the truth, but in such a way that they appreciate you for telling it, and not punish you for doing so. Diplomacy and tact must be coupled with the belief that you are telling them what they need to hear, and a determination to do what’s right for your clients.
Leaving clients sitting at the wrong price is not doing what is right for them.
Change the conversation and you will continue making sales.
My wife and I have a property on the market. It’s with an agent we trust, and it’s listed exclusively.
Around 6 weeks into the marketing campaign, I received a phone call from another agent who asked whether I’d consider changing agencies. My reply?
“How would you feel if other agents rang your exclusively-listed clients?”
That wasn’t a response this agent was expecting and there was silence. Eventually he said, “I’m just asking“. I repeated my question – ”How would you feel if other agents rang your exclusively-listed clients?” He didn’t want to answer that question, so I hung up.
I think that agents who prospect other agents’ exclusive listings are the bottom of the barrel. If a salesperson’s main way of getting listings is to resort to that tactic, in my opinion the salesperson is unethical and unprofessional.
Think about it. If I sign an agreement with you, I am giving my word that you will be my exclusive agent. My wife and I believe that a deal is a deal, and we know what Exclusive means. For those who don’t, the dictionary definition of Exclusive is: restricted to the person, group, or area concerned.
So when an agent calls a seller who is listed exclusively with a competitor, the agent is asking those sellers to break their agreement, to break their word. That is unethical, grubby conduct for any professional to indulge in.
In every area there are people who are ready to sell and who are not yet listed. They can be found through marketing channels such as print, through digital channels, and through prospecting.
The latter channel, prospecting, is a dirty word for many salespeople and for some, like the agent who called me, they go for the low-hanging fruit – sellers listed with other agents.
We are better than that, or we should be.
To an ethical professional, resorting to such tactics because “everybody else is doing it” is not an excuse. You can’t be honest and ethical when it suits you. You are either a bottom of the barrel agent, or you aren’t.
Which agent are you?
“…and if you can’t be with the one you love honey.
Love the one you’re with, Love the one you’re with.”
Buyers are the sellers of the future. How we treat people during the buying phase of their home ownership journey determines the likelihood of them selling with you when the time comes.
Throughout the sellers’ market that in some areas is now past, many buyers received less than stellar service. At times when there were multiple parties vying to buy a property, it was easy for agents to be blasé in their treatment of buyers.
But buyers have long memories. They remember how they were treated and the day of payback for agents who treated them badly will come.
It is common for agents to disclose one buyer’s offer to other buyers, ‘playing them off’ against each other. They call this negotiating, but it is poles apart from ethical negotiation and is unprofessional to say the least.
Agents allow buyers to pay for pest and building reports on properties that the agent knows those buyers don’t have a chance of buying on their budgets. Underquoting to buyers is a practice that still abounds.
It’s interesting that at the high-priced end of the property market, the service many agents provide is slick and professional – for sellers and for buyers. These agents know that for a high fee, often in excess of $60,000, treating people well is profitable practice. It’s not always this way, but it often is.
However, work your way down the fee scale and you often see poorer service. It should not be this way.
All clients, whether buyers, sellers, landlords or tenants, deserve 6-star service. Giving this level of service pays dividends long term.
I am a great believer in “What goes around comes around“, and possibly you are too.
Treating all clients well is rewarding and a nicer way to do business.
Give buyers the same standard of service as you give to property sellers and those buyers will be more likely sell with you in the future.
If you plan on being in real estate for the long haul, always remember that buyers are sellers of the future.
As Stephen Stills said, “Love the one you’re with“.
No doubt you have heard of the Prospect Pipeline, a good analogy to describe a constant flow of prospects, from which business should easily flow.
Business should flow, but it doesn’t always. Your Prospect Pipeline requires care and attention if it is to produce the desired results.
Real estate salespeople can become fixated on immediate leads, and it is right that they are. After all, without good leads it’s hard to get results. This is one of the functions of your Prospect Pipeline, to provide you with prospects that are ready to buy and sell now.
But if that is all you focus on, your pipeline can become clogged, and ‘now’ leads will dry up.
The pipeline analogy implies that if you pour plenty of prospects in one end, they will flow through the pipe and come out the other end as sellers and buyers that are ready to do business. It’s as though the process is automatic, but it is not.
If you want to keep your Prospect Pipeline flowing, you have work to do. That work takes the form of diligent follow-up.
In your Prospect Pipeline, there could be three types of people – let’s not be in a hurry to call them prospects just yet.
The three types of people are:
- People ready to do business now – this is the end of the pipe.We do not need to say much about ‘now’ clients, except that they are the reason why you have a pipeline in the first place. The goal of a good prospect pipeline is to give you a constant flow of this type of prospect.
- People who will do business in the future. These people should become ‘now’ leads.These are the people many salespeople neglect. ‘Futures’, must be moved through the pipeline so that they reach the point where they become ‘now’ leads. You achieve this by following up your ‘futures’ regularly, always with the view of identifying when they are ready to buy or sell.The reason this group is most neglected is for the reason I stated earlier: real estate salespeople can become fixated on immediate leads, and do not invest the time working their pipeline, nurturing the people who will do business sometime in the future but who are not ready now.It is shortsighted to contact prospects, identify the likelihood of them becoming buyers or sellers in the future, and then forget them, only to find they list or buy from a competitor.
Leads must be cultivated, not ignored.
- Non-prospects.They most likely won’t do anything.Too many of these and your pipeline can clog. If you want to get results from your Prospect Pipeline, you must fill it with… well… prospects!Non-prospects are common in rookies’ pipelines. They have a friendly conversation with somebody and confuse nice people with prospects. Poor qualifying results in low quality prospects in their pipelines.
To earn a place in your pipeline, all the people in it should be identified as buying or selling in the future, and qualified to find out when that is likely to be, or ready to buy or sell now.
Nobody else should be in your Prospect Pipeline.
It’s similar to the GIGO formula referred to in the computer industry when referring to data – “Garbage in, garbage out”. Instead, let’s make it PILO – “Prospects in, leads out”. Fill your pipeline with quality prospects and quality leads will come out the other end.
Those who are in your Prospect Pipeline should be followed up until they do business, or you identify them as a non-prospect and remove them from your pipe.
Do this and your Prospect Pipeline will flow, giving you quality leads that turn into listings, sales, and income.
Many salespeople around the country are reporting a shift in the market, from a sellers’ to a buyers’ market. A shift in the market can pose several challenges for salespeople.
The first challenge is to notice the shift.
Buyers are usually the first to notice a change in the market. Buyers appear fussier, which is understandable because they have more properties to choose from. Offers are harder to extract from buyers.
Another symptom is that agents carry more stock. Days on market increase. A larger portion of agency stock is overpriced for the new market, although some agents don’t face that reality, preferring to deny the shift and hold onto the vain hope that their listings will soon sell.
Finally the sellers get the message, although how quickly they do depends on their listing agent’s willingness to convey to them the reality of the market.
The next challenge is to stay positive.
In any market, and I mean ANY MARKET, listings sell if they are priced correctly. Overpriced listings don’t. Therefore, in buyers’ markets, skilled agents make sales. The secret is to stay positive and believe that you can thrive in this new market.
My friend, Peter O’Malley, principal of Harris Partners Balmain says, “There is no such thing as a tough market. There is such a thing as weak salespeople“.
I think he’s on the money. In buyers’ markets the easiest thing is to blame the market for a lack of sales and saleable listings. The fact is, skilled agents list and sell in high numbers in all markets. They face the reality of each market and face challenges head-on.
For decades I’ve heard salespeople blame the market for their poor performance, but I’ve never heard them credit a boom when they do well. If you’re a market victim, you’d better pray for another boom to come soon!
The third challenge is to reskill, and quickly.
If you’ve been in real estate for twenty years or more, you’ve seen every type of market there is. If you’ve been around that long, you’ve developed skills to survive and thrive in any market.
But each market throws up different challenges. Price reductions – repositioning the price – is a good example.
In a sellers’ market, agents who initially overpriced their listings often didn’t need to ask sellers to reposition their prices. The market was rising and even properties that were initially overpriced for the market, sold.
Not so in a buyers’ market. Coming out of a sellers’ market into a buyers’ market requires salespeople to reskill, and quickly. How you handle the price issue is crucial to your success. The sooner you reskill to handle the price, the quicker you’ll adapt to the new market.
Conducting the price discussion during your listing presentation is important. To be able to deliver an HONEST estimate of the likely selling price of a property during a listing presentation and still win the business is the hallmark of a skilled lister.
For many years I’ve said, “In real estate, to tell the truth about price and still win the listing, you’d better be a skilled presenter“. This is the market where you’ll require this skill once more.
You might also need to brush up your skill in asking sellers to reposition their price, should buyer interest and buyer feedback suggest that a price reduction is necessary.
Overcome these three challenges: 1. Notice the shift; 2. Stay positive; 3. Reskill quickly, and you are well placed to make the most of a buyers’ market.
When the market shifts, we must too.
The saying, “Practice makes perfect” is one that probably goes unquestioned. We know that the more we practise, the better at that activity we become.
But what if we’re practising an activity that is not productive, and it doesn’t take us closer to our goals?
Practice under those circumstances makes us good at nothing useful.
Whether it’s hobby or business, practice only makes perfect if you’re practising the right things.
An example is your listing presentation. If you practise your presentation, well done. But you should be sure that your listing presentation, when delivered skillfully, will get results.
If your presentation doesn’t contain compelling reasons why a seller should list with you, or if your presentation makes similar offerings to your competitors, your practice will make you good at delivering an ineffective presentation.
What makes you different to your competitors? What do these differences do for the sellers? What are the benefits? And can you prove that you are better than your competitors?
This is useful practice.
When practising your listing presentation, role plays are useful. Practise in front of your spouse, family member or friend. Get them to tell you honestly whether you were convincing or whether your presentation needs work.
Pay attention to what you say. Are you making too many statements and not asking enough questions? Question technique is useful practice.
Practice does make perfect, but only if you’re practising the right things.
Happy New Year! May 2022 be the year you set goals, make plans, and have your best year ever.
But first let’s talk about last year. Was 2021 a good year for you, despite lockdowns?
I noticed that salespeople generally fell into two groups:
- Those who did well throughout the year.
This group worked within health guidelines and navigated lockdowns. They kept talking to people and set appointments for when lockdown was over. They had listing appointments to attend as soon as lockdown lifted and avoided the biggest mistake you can make in a boom: running out of stock.
They faced setbacks head-on and worked around them. They got great results and capitalised on the boom. They deserve their success.
Who’d have thought a boom was waiting for us when we came out of lockdown?
- Those who succumbed to setbacks and did poorly.
To be kind, these people treated lockdowns like some sort of Covid holiday. Despite badgering from their leaders, they didn’t prospect in significant numbers and ran their prospect pipelines dry.
They probably weren’t good prospectors prior to lockdown, and despite having nothing else to do except talk to people, they steadfastly stuck to their losing habits.
In failing to set up appointments for post-lockdown, these salespeople (I choke at using that name for this group) had few appointments, were low on stock, and made few sales.
How can you not make sales in a boom? It’s easier than you might think – just run yourself out of stock.
Our success is largely in our hands. We can’t control the market. We can’t control snap lockdowns. But we can control our actions.
With climbing vaccination rates, lockdowns are hopefully a thing of the past, but there are no guarantees in business or in life. By focusing on what we can control, we give ourselves the greatest chance to make 2022 our best year ever.
- Set Goals – have you set yours? Are they written down?
- Make Plans – plans that lead you to your goals.
- Prospect and keep your pipeline full.
- Train and improve your knowledge and skill.
The question is, will you? Success doesn’t happen by chance. Success is within your control. Take control – plot your course and follow it.
“Everybody has a plan until they get punched in the mouth.”
As we approach the end of 2021, I want to convince you to set goals and plan your actions for 2022. The new year is only a month away.
Despite the uncertainty you’ve experienced in 2020 and 2021, goal setting and planning are more important than ever.
You may be tempted to think, “Why bother? Plans go out the window when there is a snap lockdown“.
To a degree, this is true. Uncertainty has a way of messing with plans. But does this mean we should have no plans?
In an article by Mike Bernadino in The Sun Sentinel, Mike Tyson was quoted as saying, “Everybody has a plan until they get hit. Then, like a rat, they stop in fear and freeze“.
Bernadino expanded, “What I like so much about the quote is that its application stretches far beyond boxing. It really has meaning in any area of life, whether the blow comes from a health issue, losing your job, making a bad investment, a traffic jam, whatever.”
“It’s how you react to that adversity that defines you, not the adversity itself.“
He makes a good point. It’s how we react to adversity that defines us. Goals and plans help us deal with adversity and uncertainty.
Plans give us a roadmap to follow, but we must plan for uncertainty, for contingencies. While it’s okay to hope that lockdowns are behind us, we should plan for the possibility of more.
For example, listings are in short supply around the country. Every agent wants listings. I’m sure you understand the need to do everything you can to build your stock levels, and that includes prospecting for new business.
But what happens if a snap lockdown makes door knocking impossible? Are you building your database of clients? Do you have lists of potential sellers you can call? Your contingency plan directs you to make phone calls – lots of them.
Your targets do not change. Your actions do.
As Mike Bernadino said, “It’s how you react to that adversity that defines you”.
And why do you need goals when they are blocked by obstacles like short-notice health orders?
Goals give you focus.
Without them, you won’t react quickly to adversity and uncertainty. You will be slower to bounce back. You may even give up.
Why do you hear leaders complain that their salespeople treat lockdowns as a “COVID Holiday“?
It’s because their people do not have goals, they don’t have plans, and they can’t deal with uncertainty and adversity.
They’ve been punched in the face… and to quote Mike Tyson, “… like a rat, they stop in fear and freeze.“
Thank you for taking the time to read my articles this past year. All the best to you and your family, and happy new year.
There are many traits people possess that can be regarded as enemies of success. The obvious one is lack of integrity. For me, that is top of the list.
But let’s talk about another enemy of success, one that occurs daily for many salespeople:
How many opportunities are wasted by salespeople waiting for the time to be ‘just right’? These salespeople avoid tasks they regard as unpleasant, such as:
- Calling that difficult client
- Prospecting to find new business
- Setting goals (for fear of not achieving them)
The problem with avoiding tasks is that we don’t completely forget about them. We know we must do these tasks so they constantly play on our minds. Over time we feel more and more anxious because we are not doing the things we know we should be doing. We feel guilty.
These aren’t positive feelings. As long as we harbour them, they hold us back from achieving results and long-term success.
Thirty years ago I read some advice that I use to this day.
I call it the Winner’s Mantra:
DO IT NOW.
If I know that I have a tough call to make, as soon as it occurs to me that I must make that call, I think about what needs to be said and pick up the phone. I don’t let it fester in my mind, because as long as it’s there, I begin to feel guilty about not doing something I must do. Do it now. Get it behind me. Move on to another high priority task.
About ten years ago I had a call from a person I knew. It was a sales call but despite knowing me the call didn’t go well for him. He caught me at a bad time and for some reason, his approach bothered me. So I told him. I was abrupt and rude, though that didn’t occur to me for a long time.
But I noticed that over the past few years that incident came to mind, and this occurred to me more than once. It happened again last Friday. So I searched for that person on the internet, tracked him down and called him.
Surprisingly, he was glad to hear from me. I apologised for the way I treated him. And I got it out of my mind.
Even more surprisingly he didn’t remember the incident, but here’s the point: I DID. Then I made the call and now I don’t think about it.
My intention was to do the right thing by him, but in the end, I did the right thing by me. Because I thought about this incident over time, I realised that I should address it. Once I realised that it should be addressed, I made the call immediately – do it now.
Have you ever noticed that the things you put off doing are the same things that give you the best results once you do them? Even if they don’t give you a result, they give you relief, as did my call to the man I treated badly all those years ago.
Procrastination can become a habit. So can ACTION.
Which habit will serve you best?
Procrastination is the enemy of success. If you think that something needs to be done, do it now and move on. Change the mental list of “Must Do’s” into “Have Dones“.
I guarantee you’ll be more productive and win more clients too.
There can be no doubt that the pandemic, now in its second year, has disrupted business and the economy.
The real estate industry has been less affected than, say, tourism and entertainment, but the pandemic has still led to periodic restrictions on how we go about our daily business life.
But is it all bad news? For good business owners and salespeople, the pandemic has also taught us valuable lessons. Let’s look at two of those lessons.
Tasks we could perform one week were no longer possible the following week. Other tasks became more important than ever before. To continue to succeed in Sales, we needed – and still need – to be flexible.
Flexibility is good. It allows us to quickly revisit actions that are no longer appropriate and change direction, to try something else.
If that doesn’t work, we try something else and keep trying different approaches until we find an approach that is appropriate for the current restrictions.
An example is open homes. Some pandemic restrictions made open homes a breach of health orders, but we have still been able to conduct individual inspections. Even these have not been smooth sailing, with some sellers and tenants refusing to allow strangers into their properties.
But we adapt and show properties where those restrictions aren’t present, and we make sales.
Such is the advantage of being flexible and moving forward, focusing on results.
Another lesson from the pandemic is the need for contact.
During extended lockdowns, I made it a habit to call three people a day and ask how they were doing. A simple act that I found helped me as much as the people I called. It reminded me to take time to think of others and to take my mind off myself.
For salespeople, contacting potential clients is more important than ever before. If you can’t door knock, pick up the phone. Call people and ask how they are. The conversation will eventually turn to their plans around selling, soon or longer term. You might not be able to list them now, but these people go into your prospecting pipeline and are listing leads for the future. Cultivate relationships.
Our opportunities to list now may be somewhat restricted, but some will want to list now, and others when restrictions ease. High volume contact will tell you who’s who – short term or long term prospects.
You probably found that people are much happier to talk when their movements are restricted. Yet another bonus for prospectors!
As you read this, your region may be experiencing relative freedom, but we know that snap lockdowns can occur at any time.
But the pandemic lessons still apply. Flexibility and human contact are always good attributes for salespeople and business leaders to possess.
Lessons that, once learnt, should never be forgotten.
Do you remember the days when salespeople used to list large numbers of properties – eight or more every month? We seldom see numbers like these anymore – salespeople have become used to low numbers.
Many years ago we coined the term, “Take care of the numbers and the dollars will take care of themselves“. This is just as true today. When salespeople focus on gross commission, on the dollars, the numbers always suffer. Salespeople who focus on dollars set lower targets.
Let’s say that to achieve your goals, you plan to average $60,000 in fees every month. If your average selling fee is $30,000, this would be 2 sales per month.
That’s 2 sales at an average selling fee of $30,000 – but what if you make a larger sale, one sale, where the fee for that sale is $60,000? Most salespeople slow down; after all, they have achieved their dollars, so they coast for the rest of the month.
That is more common than you think, and it’s the danger of focusing on the dollars. A better way is to focus on listing and sale numbers.
Using the example above, if your focus is 2 sales and you make one sale at $60,000, you will push to get the second sale. If this second sale gives a $30,000 fee, you have made $90,000 in fees, all because you focused on the numbers and not the dollars.
The same approach works with listings.
Every salesperson has a list-to-sell ratio, for example, 2:1 where 2 listings result in 1 sale. In your current market your list-to-sell ratio might be 1:1, with one listing resulting in one sale. These are low numbers and low targets can be a recipe for low results.
If you have a listing target of 4, and you only manage to get 2 in the month, your results have dropped by 50% – that’s a big drop!
But what if you increased your listing target to 8? What if you were serious about reaching that target? Would you prospect more? Would you instigate more marketing?
Thinking bigger and aiming for higher targets almost always results in higher results, provided that you increase your prospecting and marketing activity to a level that should realistically yield those higher targets.
One thing’s for sure: if you have a target of 8 listings and you fall short by 50%, you finish the month on 4 listings. If you have a target of 4 listings and you fall short by 50%, you finish on 2 listings. Twice the results by aiming higher.
Train yourself to think bigger – get used to bigger listings and sales targets. Don’t get accustomed to low numbers, and don’t focus on dollars alone.
Focus on the (higher) numbers of listings and sales, and the dollars will take care of themselves.
Ask any person how important their reputation is to them. Nobody will say their reputation doesn’t matter.
Sure, some say, “I don’t care what other people think of me” – but that’s usually to justify being rude or insensitive. If these people care that little about their reputation, they probably can’t be trusted.
In life, your reputation matters. A poor reputation can cost you good relationships, happiness and fulfillment. In business, a poor reputation can cost you repeat business and income.
Salespeople who treat clients badly believe that there are plenty more clients where they came from. What does it matter if you inflate the likely selling prices of sellers’ properties to win a listing? It matters a lot if you want to do business with those clients or their friends in the future.
What does it matter if you lower an estimated selling price to attract buyers? There are plenty more where they came from. Perhaps in sellers’ markets there are, but buyers become sellers one day and if you want to be their listing agent when they do sell, your reputation matters. It matters a lot.
In the 20th century, it was said that if you leave a client angry, they will tell 10-15 other people. That was last century, but it’s different now in the age of social media. Upset a client these days and they could tell thousands of people in minutes, depending on their social media following.
Pre-social media, a bad review was passed around by word of mouth. A bad review on Google or a similar platform can haunt you for years.
Reputation matters and in the age of social media it matters more.
Be careful with what you promise. Deliver what you promise. Be reliable. Do what you said you would do, when you said you would do it.
It’s a matter of integrity. It’s a matter of reputation.
And reputation matters.