Making money in a tough market

So, dear reader, as per the last post about my recent trip to Brisbane and my random musings on how similar real estate markets are around the globe, I thought I’d share my notes from Richard Rawlings’ main talk about making money in tough times. It is mainly about selling real estate, but I think there are lessons for all people who are selling in a period of downturn …

Only motivated sellers are coming to market. You don’t actually want to deal with ‘stupid sellers’, because not only do they have unrealistic expectations on the price of their homes, even if you did find a buyer stupid enough to buy the stupid price from the stupid seller, the stupid seller is so stupid they won’t even take the stupid price from the stupid buyer! So work with motivated sellers. You can’t sell a $10 bill for $11, in fact you can’t even sell it for $10, but make it $8 or $9 and you’ll get interest… so get the market going.

Rents are rising fast, naturally enough, as people are finding it difficult, if not impossible to get loans, and prices of houses (although lower than they were) are still quite high.

Despite all this, don’t  be hopeful, be proactive! Don’t worry about the market, worry about your marketing. If you have 15% share of a local market, so what? Go out and get the other 85%.

How can you influence your market share? In 3 ways:

1. What you do (action)
2. Who you are (integrity) and,
3. How you argue your case (persuasion)

If you ask sellers, they will say they judge real estate agents on how high a price they can get and how low you charge – both are bad reasons  for choosing an agent! Higher the price is probably the worst reason to choose, as stats show a well priced property sells quicker (and in the end for a better price) than one that comes on too high, hangs around and gets stale, and then you have to lower it right down to shift it. And as for lower commissions, well if you can’t defend that, how are you going to get the best price for your clients? Don’t get distracted or concerned by low commission agencies – defending your commission requires same skills that will grow your market share.

Some agents rush to social media, and blast all their listings on twitter. That’s like walking up to random people in supermarkets and shouting at them: “Wanna buy this house?!!!” The chances are you will only annoy people. What you want to happen is getting others to talk about YOU on twitter and the like. So, what are you doing that is remarkable? That will go viral on social media. Personal recommendations are what matters now.

Do you hold keys for buyers in case they are locked out? and turn up at 2 in the morning when they have locked themselveas out? Do you water their garden when they are on holiday? These are the things that will WOW your clients, get you talked about, and will win you new business.

It’s not the number of ‘for sale’ signs, it’s speed of sale, sale price vs asking price, number of cancelled sales, inspections, and fewer price reductions that actually matter and should be your yardsticks.

Don’t ask your clients what they want, think what they will LOVE! Be in the business of FUN! Virgin has Indian head massages and is investigating putting pool tables in planes (seriously). They did not ask clients whether they wanted these, the clients had no idea. Just think what will wow them. We didn’t ask mobile phone companies to put cameras in them, have them synch with outlook, install tetris and demand video conferencings … but someone at Apple thought phones could do this, and when we saw it, we loved it. As Henry Ford once said, “if I’d asked my customers what they wanted, they’d have said: a faster horse!”

The fundamentals are truth, beauty, humour, attractiveness, integrity – build these into your brand.

What does your service DO for your clients? How does it make them FEEL? The #1 reason for choosing agent is personal recommendation; how well you presented; location of office; … one of the lowest reasons is fees.

You only need to win by a nose to get the business, so go the extra mile.

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Inspirational stuff eh? For more on Richard Rawlings, he is speaking at REIWA Learning this week, and also see his web site