The Keys to Success in Real Estate with SalesPartner: XX

Key 3.2 How to find the best buyer and their best offer, and then determine whether to accept it.

John Duncan MBA BCA Licensed Real Estate Salesperson (REAA 2008)

Part XIX

The first step in this phase is to organise the best possible presentation and photos at the beginning of the listing process. As a salesperson you should provide advice to vendors on presentation, and organise professional photography. Check details like ensuring the electricity stays on, and valuables are secured.

Then you organise a preview for your database clients. SalesPartner has a preview invitation template you can use. The objective of the preview is that you send out invitations without details of the time and address and ask your clients to contact you if they are interested.

At this stage you may have an agreed “price talk” formula with your vendor, which you should let your colleagues know about and may optionally use in the invitations to the previews. The property is usually available “by negotiation” at this early stage. Any interested buyers should be provided with a CMA as well as flyers.

We have noted at least one successful franchise with a number of offices who have a set rule that salespeople cannot put a price on a new listing for at least a week after first listing it.

It is worth pointing out that you do not have to organise a set time or even a set day for the early buyer visits we call previews. The invitation to a preview is a call to action similar to any other call to prospective buyers about a new listing. However, using SalesPartner data-basing and emails you can send the invitation to many more people than just your VIP buyers (who you should also phone) and give your contacts an opportunity to contact you if they are interested. Preview marketing should give you an indication of the interest level for a property among buyers in the market.

NB In any market, most active buyers will be known to at least one of the salespeople in your office if your team members are keeping a database and following up open homes visitors.

Another insight from David Knox is looking more deeply into the concept of “market price”. It is easy to talk about “market price” as though it is an achievable, knowable level for any property. Would you agree that all properties sold through the market have sold at “market price”? This seems instinctively to be a contradiction even though it must be true.

David Knox points out that “market price” is a concept like “room temperature”. All rooms are at “room temperature” but it is obvious to us that some rooms are warmer than others. Some market prices are also better than others.

How big a range to expect for “market prices” can be gathered from the 12 to 15% either side of the achieved selling price that a professional valuation may assess as a property’s value in advance of the sale. Also, remember the 20% either side of selling price often reported in many salespeople's’ estimates after caravans. Even at a relatively conservative 10% either way, a sale at the top end of the range of “market prices” for the property can have a very large impact on the net equity recovered by the vendor.

So how do you achieve a top end sale for your vendor? We put together some thoughts on “room temperature” with the objective of illustrating ways to achieve a hotter “market price”.

How do you warm up a room?

1. Fill it with people. The key to getting a succession of people through the properties you want to warm up is pro-active data-basing and your contact management. You must have systems to let as many people as possible (who might visit) know that you have a property to sell.
   
2. Kitchens are warm rooms, primarily because there is lots of activity centered around them and there is heat given off while preparing meals. Have a marketing plan, and have a series of activities building up to a decision time like preparing for a good meal.
3. Plug the gaps and stop the drafts to warm up a room. Improve presentation of the property, do the small repairs and keep the gardens and surrounds tidy for a hotter price.
4. A sure way to increase a room’s temperature is to expose it to the sun or put in a heater – this is a good parallel for profile marketing. Encourage your vendors to help put their property in the sun with good advertising and promotion. Combined with good timing ensuring adverts are noticed during negotiations with buyers, this spotlighting will contribute to a hotter market price.
   
5. Continue activity in your kitchen with lots of courses and snack options. During your marketing offer optional extra adverts and activities, like extra delivery of neighbourhood trump flyers when prices change to keep the communication processes going.
   
6. Have your friends and relatives visit as often as possible – you should ensure your vendors have flyers and information sheets they can give out to friends, relatives, work colleagues and other potentially interested people they may know about. Also, make it easy for them to send URLs highlighting their property to others in their circle of family and friends.
7. Have a party – set up a preview by invitation for your listing and get the buyers noticing each other as well as the property itself. The best path to achieving the best price is to ensure buyers are competing with each other. Schedule another party based around an Auction or Tender date coupled with marketing and promotion to raise the temperature before the party starts.