Helping Sellers List in a Dynamic Market

This podcast reviews the first 3 steps to a successful listing consultation, then takes a deep dive into how agents help sellers understand the market and the process of selling their home.  

This is a content rich podcast with suggestions on how agents on a budget can articulate their value to sellers.

Transcript

Microphone (Samson Q2U Microphone)-3: 0:03

Welcome to real estate. Common sense. I'm your host. Lisa Spencer. I grew up in a real estate. Family was a top producing agent and a managing broker for over a decade. Eventually leading an office of over 400 agents. What I've discovered is common sense is not that common, especially when it comes to launching building or expanding a real estate business. I have interviewed thousands of agents and helped hundreds launch successful careers. Today, we are going to talk about how to help sellers list in a dynamic market. We should begin this podcast with a warning. That it is very content rich. And then you may want to have the ability to take notes. All of our podcasts are transcribed. So this may be a time you want to review the transcript to extract any elements you want to add to your listing consultations. If you've been tuning into our podcast, sequentially, you know that in our last episode, we covered the 10 questions that reveal seller motivation. These questions usually proceed the listing appointment and are reviewed in a conversational manner to set the stage for the next steps of the listing consultation. In my book, real estate, common sense. We divide the listing process into five steps. The bulk of this podcast will be dedicated to step four, demonstrating your value, but for the sake of continuity and flow, we'll review a brief summary of steps. One through three. The first step was the interview, which we covered in the 10 questions that reveal seller motivation. Step two is to tour the home or property. Hopefully you do not need a podcast episode to describe how to tour the property. And there were two schools of thought around this. I'll do my best to present an unbiased review of these two methods. When I had a real estate business in Morristown, New Jersey, we always went to the home ahead of the consultation meeting. Some of the homes in our town dated back to the 18 hundreds, and most homes were unique and had a lot of variation as to the updates and renovations. In that environment, it was important to preview the home before preparing any kind of market analysis. We used this time to take room measurements and photos. My first few years in real estate, we literally took our film to the one hour photo. And used a glue stick to put them on a brochure. I'm sure I lost some of you with one hour photo, but desktop printing was revolutionary for the real estate industry. After the pre-listing tour, we would leave behind the disclosures and the seller would then review them. And we'd head back into the office to prepare our CMA or comparative market analysis. We could come into our listing appointment fully loaded with customized brochures and a detailed listing information sheet. This method had some merits in that we had time to explore both the home. And the personality of at least one of the sellers. Once I moved to Florida in 2005, the one-step appointment was more popular. Software for market analysis replaced our research in the MLS books and dos programs. I may have lost a few more of you there. And the speed and ability to take on more became the focus. Incorporating a tour in a one-step appointment can also provide some nice icebreaking conversation and let's face it. realtor.com and Zillow have taken a lot of the mystery out of the market analysis. Most sellers are already aware of a price range for their home. If not fixated on one. The method you choose to accomplish your property tour is up to you. You're responsible as a real estate professional for accurately documenting the material facts and features of the homes you list. So please don't cheat this process. As a broker, I have seen agents get caught up in representing that a home had a water softener only to find out that it was rented. Guess who's buying a water softener. Even worse is the agent who assumes that because all of the other houses on the street are on a public sewer system that this home must be too. Oops. Do you know how much it can cost to connect to public sewer? Even if it's already on the street. Hopefully the days of short sales and bank owned properties were the reason that some of those things happened. The reason why our profession even exists is because consumers felt protected by working with an agent who could be a knowledgeable guide to help them through a process that they may only navigate a few times in their life. The property tour and documenting the material features of a home and property are an important step in the listing process. I'm not sure how to make it interesting because it involves so much detail, but spend some time developing systems around how you will accomplish this valuable part of the service we provide. After step one, the interview and step two the tour, we move into step three, which is to meet with all of the decision makers. Hopefully in the same appointment for efficiency and effectiveness. This is a common sense. Step, hardly worth mentioning. And since our podcast is titled real estate common sense. We are going to cover it because I feel I have seen agents burned by skipping it. In the days of e-signature, this may appear unnecessary. And of course, meeting through an online portal is acceptable. Meeting with all the decision-makers to secure the listing is essential because it is not only about securing a signature on a document. You are preparing them for a journey. And assessing their willingness to work with you and the other sellers. For instance, I once got a tiny condo in Florida with nine heirs to the estate, through probate and to a successful sale in two weeks. That scenario could have taken up to two years. If we weren't all on the same page. You will repeat the, getting to know you interview questions with all of the decision-makers. And in the case of an estate add a few more questions to that,"getting to know you" like: are you working with a probate attorney, or how should we handle negotiations when an offer comes in? Keep it cordial and engaging without spiraling into too much detail. Then you can move on to step four, demonstrating your value. And this is where we're going to spend the bulk of our podcast. If you have a solid presentation booklet or a slide show that can demonstrate the value you provide and how you will provide a way to help the seller get the most amount of money in the least amount of time, with the least inconvenience to them, you will find that you will not have to defend your professional fees. So we're pretty deep here into this conversation and we're about to dig into the details. So let's refresh that this episode is about. Helping sellers list in a dynamic market. You will need to be prepared to adjust the conversation, to meet the market of the moment. And still address the universal concerns of sellers about how to obtain the best price possible. Here is where experienced agents can have an advantage. They simply have more time on the job and understand the subtle signals of the market. And the finesse of explaining the process. But if you were an astute listener and captured the areas of focus and concern for the sellers, and then you address them in this step. You can easily win their confidence and thereby the listing. You are not going to address all of the things that I'm going to mention now. But I am going to list all of the things that we do as agents. The key is to focus and elaborate on what was important to the seller. The only way you'll know that as if you did those questions, the"getting to know you" questions in the beginning. So hopefully you'll develop some kind of visual aids. Or you may simply want to put them on a list. So here we go. Here are the services that you can provide before the listing even goes live. You can explain your agency relationship. This is important to explain your fiduciary responsibilities and you can work in many different ways in most states. So it's important to know what type of agency relationship you're going to have, and simply explaining this to a seller sometimes sets you above any of the other agents that they have interviewed. Offer a home warranty or mortgage and title services. Many consumers like the ease of being connected with these services. And if you have affiliated businesses, this also provides a segway for you to get the appropriate disclosure signed. Then provide a written marketing plan, testimonials or reviews. These can be very reassuring to the seller. Then before the listing even goes live, you can provide information about the current conditions and prepare a comparative or competitive market analysis. And we'll talk more about this in step five, you can provide staging for success suggestions. I only mentioned this. If during our previous interview, they've requested assistance with staging. Don't mention staging at all. If you've walked in and this home is just beautiful and ready for a photo shoot right now. They may not be interested in your suggestions and they don't need them. If the house looks beautiful. Then you can talk about how you schedule professional interior and exterior photos. Of course, only if you use a professional photographer. Gather a complete list of home specifications and complete the MLS data sheet. And let the seller review that. Show them the amount of work that goes into just putting a listing in the MLS. You're going to provide them with seller disclosure statements, which they will complete. And then you'll also provide a seller estimated closing costs. And you can work with a lender or a title company to get this. If you don't have a way to do it yourself. So, those are just some of the things you're going to cover before you even list the home. And sometimes it's important to cover these details with the seller. So they know that our job is more than just finding a buyer and immediately going to the closing table with that buyer. So now let's talk about the marketing elements. The following are what I feel are the minimum marketing efforts, the ones that make the most common sense. Successful agents can really shine during this step by featuring their advanced marketing and may have a larger marketing budget than you do. Hopefully these suggestions will help a newer agent highlight their services. The first thing you can do is provide a professionally installed quality yard sign. Our sign installer investigates, electric cable and waterlines prior to installing a signpost. Cutting someone's cable off is not a good way to start your listing. So mentioning the fact that you use a professional sign installer could be something that gives you an edge. Then install an electronic lockbox. Well, doesn't everyone. Maybe not. Explain how electronic lockbox works. And that can be very reassuring for someone who has expressed concerns about safety. You may not even need to cover this, but covering it could be important if you learned that in their concerns about moving. They said I'm concerned about a bunch of people coming through my house. So then discuss the advantages of the MLS system and the unique profession that we're in. They don't understand that by listing with one company, they're also exposing their home to other brands through the multiple listing service. Explain how syndication works and that you can confirm that the syndication has been done accurately on sites like realtor.com, Zillow, et cetera. Describe your social media campaigns and how you'll communicate the results to the seller. Will you prepare a highlights brochure, and how will that material be distributed? Will you distribute electronically? Will you do email campaigns? Will you use a QR code? Describing how you will market their home through a highlights brochure can be very important. Find out if they desire or will support a cooperative broker Or public open house. Do you offer target marketing? Do you have a plan that involves circle prospecting or postcards? Explain how you will obtain and share agent feedback from your showings. How will you provide marketing updates? This conversation can secure a listing for you, especially if you are marketing the home in a buyer's market. Are you a skilled negotiator mentioning this could be reassuring to a first time seller and talking about negotiations can also provide an opportunity to expand the conversation around the conditions of the overall market. Before we get to step five, where you'll establish the offering price. You have the ability to review potential buyers, mortgage information. We can emphasize that before taking their home off the market, that you will review all of the terms and conditions and walk them through the hazards of the due diligence period. That reassurance can really help in increasing the confidence and trust of the seller. This leads nicely to a place where you can talk about how you'll be an advocate for the seller from contract to close. The area of transaction management is where an agent can really feature their value. So, this is where I have to take a little sidebar to talk about transaction management companies. Some offices offer transaction management services as a part of their service to agents and others use them as additional means to produce revenue for the office. As a broker, our office used an in-house transaction company as a resource for training new agents. We required agents to do four transactions with that transaction manager, and then let the agent choose if they wanted to continue using the service or manage their own. The reason we had this requirement is that real estate school does not teach an agent how to manage the 30 other service professionals that can potentially be involved in a transaction. New agents were required to shadow a transaction coordinator in order to understand the timelines and the need to assist the mortgage company, attorney surveyor and title company in achieving an on-time closing. Regardless of whether you decide to utilize a transaction coordinator, you should maintain all of the contact with the seller. It is in these conversations that you earn referrals in the future. And it is in the abundance of communication that we avoid the pitfalls that take transactions sideways. So let's review the basics of good transaction management. They involve a system for tracking deadlines and contract contingencies. You want to facilitate communication among all the parties involved in the transaction? This avoids the, he said, she said moments that can get everyone agitated. Attend the home inspection on behalf of the seller. Yes. I feel that a listing agent should at least check in on every home inspection. Then work to resolve any home inspection issues and assist in setting up any repair work. Are you building your network of allied resources? This is where you can really shine. You may also want to help a seller confirm the disconnected utilities. Sellers often have a lot happening and help with this as welcome. Then you're going to schedule a final walkthrough. Do the sellers need some extra time. Can you help by offering a cleaning service as a part of your marketing plan that will help make their experience so much better. Collect keys, garage, door openers, et cetera. Today's smart homes. Present new challenges about transferring possession of a property. And lastly attend the closing. Yep. Attending the closing is important, especially if the seller signed in advance and is counting on you to be their representative.. So we covered a generalized list of most of the things we do as agents to provide value to sellers. I did a workshop in my office once. And an agent that transferred from another company said, this is too much. I'm not going to do all this stuff. As you may have guessed, he left our brokerage. Having. High standards for yourself and the professionals you associate with will build your reputation. And the converse is also true. The mortgage company that doesn't perform on time, damages, your reputation, even if you didn't recommend them. As the REALTOR, we are expected to improve and enhance the seller experience and anything that goes wrong is a reflection on your performance in the seller's mind. Regardless of which of the items on the list of services that you choose to include or expound on? During your consultation is up to you as directed by the sellers needs. The one thing you absolutely must cover is the overall condition of the market. This is especially. True in the market we are experiencing right now in 2023. And to keep the shelf life of this podcast, we'll cover how to frame market conditions. In a general way. Some fabulous scripts or as I like to call them words that work can be found in the book real estate common sense available on Amazon. Where we go into the detail of how to discuss things in different markets. My very first listing was for my friend. And at the end of my consultation, her husband said, I now know more than I ever wanted to know about how real estate works. I may have overdone it. And as my career developed, I did attract the more detail oriented clients. For broader application, we will start with the"statistics you must know" and share an every listing consultation. The first thing to do is to state and credit your sources. For example, you would say. Let me share some statistics published by the Florida association of realtors. These statistics were published in the month of August and reference information up to the end of July. In a dynamic real estate market. Things can change rapidly. So sourcing your data with the most current statistics is important. The first statistic is the number of current active listings in your market area. Later, you will offer a CMA that gets very specific, but the available listings in the market overall helps set the pace. You will then compare that number of total active listings at the same time last year. This number is then reflected as a percentage. So the conversation may go something like this. Last year, we had a total of 1600 homes available in our county, town or zip code. And this year we have 1,835. This represents a 15% increase in the number of available homes in our area. And as you know, The more homes that are available, the less pressure there is driving pricing upward. So you'll notice that I did not use terms like inventory or absorption rate. These are industry terms that can alienate the seller and can also confuse the point you're trying to make. So keep it simple and easy to follow. Remember I said there were 1600 homes available in our county last year, and this year there's 1,835. This represents a 15% increase in the number of available homes in our area. And as you know, when more homes are available, there is less pressure driving pricing upward. That definitely is terms that the seller can understand without using industry. Lingo. Then you're going to talk about the absorption rate. The absorption rate will be expressed in the MLS or the state and national records as months inventory. This number reflects how long it will take to sell every home in a designated market area at the current pace. If no new homes entered the market. So 2020 through 2022 saw ridiculous low numbers. Our local county went down to less than one month inventory in 2022. Unlike January of 2008, when we had a 25 month inventory in the same county. At this point, you've established the pace of the market, with the conversation about the ratio between the number of available listings and the absorption rate or months inventory, which demonstrates the number of qualified. Buyers that currently are purchasing homes in your area. So the last thing you cover is the overall increase or decrease in housing prices. Our local board tracks, average sale price, which the state tends to track median price. I would use the median price. when it's available as an unusually high or low sale can impact the average sale price. There are many more charts and statistics that I'd like to employ. And if you geek out on market stats, check out our live workshops calendar. On realestatecommonsense.com or contact us to schedule a private workshop on how to really dig into local area statistics in Florida. Covering the pace and the market and overall increase or decrease in the median sale price establishes the environment in which your listing is going to be competing. When we jump right into a customized market analysis without taking the time to establish this environment, it sets the stage for the seller becoming fixated on comparing their home to one of the specific homes in the comps you offered in the CMA. Comparable homes that have sold only offer a rear view mirror view, or a snapshot of the market in the moment that the CMA was prepared. By covering a broader market view, we offer a way forward into a market that they will be participating in. It's only after laying the important groundwork and inviting the sellers commentary and waiting for signs of acknowledgement of the reality of the current market. That we move forward into their specific competitive market. analysis. That's what I like to call a CMA. Rather than a calling it a comparative market analysis. I refer to it as a competitive market analysis. This is really what we're doing. I don't want buyers to just compare this home. I want this home to compete. I want buyers to compare our listing to the others and want to make this listing the best choice the competitive market analysis is focused on helping sellers make a decision to win. If you would like to learn more about reviewing the CMA with the seller and how we cover step five, establishing an"offered at" price. Tune into our next podcast where we'll look at how to close out the consultation with establishing the pricing window. The seller will choose for marketing their home. If you are a new. Real estate professional. Take some time to review the information in this podcast. Because it will give you an advantage over the agents that will go into the consultation with a focus. On just reviewing a CMA and getting their listing agreement signed. There's so much more to the service we provide to sellers. But if we don't know how to articulate it, who will know? Feel free to check out the tools on our website, realestatecommonsense.com or purchase our book on Amazon. We hope you enjoyed this episode and will continue to join us. As we share real estate common sense support for agents launching, building, or expanding their real estate business. I'm your host, Lisa Spencer sending love and wishing you success.