What estate agents actually do
How to add huge value with a little show and tell
Ask Mr and Mrs Joe Public what an estate does for his fee, and you’ll get a variety of hostile answers, most of them unprintable. Of course, we’re all fighting with the legacy of unscrupulous agents who came before us (and those who are still to come) wielding unfair contracts and bogus buyers. But there’s another reason why the general populous thinks that agents underdeliver and overcharge – they don’t understand what we do.
An agent client of mine in Leicester recently had an experience that proves my point: he was instructed to sell a modern townhouse in a rather nice area of town. There was little precedent, as the most recent sale in the development had been pre-2007, so he spent a bit of time on the valuation, and suggested a marketing price of £300,000, leaving a little wriggle room.
The owner, a recruitment hotshot looking to move to London, was delighted, as she’d only paid around half of that. She happily signed the agreement at 1.5% and her property was live before she got home from work the next night.
The agent thought there would be good interest in the townhouse, but was very pleasantly surprised when ten viewings were booked for that weekend. The following Monday, the agent got a call from a buyer with an offer at £280,000, which, through careful negotiation and skillful discussion, he managed to tease up to asking price. Helped by the fact he had several more viewing requests that day, including a cash buyer.
By close of play that Monday, the deal was sewn up at asking price. The vendor was delighted, the buyer had got their dream home, and the agent had earned his fee. Or so he thought.
Fast-forward six weeks, and it was time to pay the piper. The solicitor called the agent to say that the vendor, his client, was querying the invoice. Having sold so quickly, she felt that there should be a discount on the fee. She was offering 1%, as “the agent didn’t have to do anything”.
Let’s look at what the agent did:
- Spent an hour with the vendor, discussing marketing strategy
- Researched local comparables, to identify the best marketing price
- Wrote a professional and appealing description of the property
- Carefully photographed each room, and the outside of the house, to make sure it looked its best
- Paid for a floorplan to be drawn up
- Uploaded the listing to his own website, and all the portals, then checked them to make sure all the adverts were correct.
- Created a compelling advert for the local newspaper
- Booked in viewings for the property, checking with the vendor each time to make sure it was convenient for him.
- Provided viewing staff to show interested buyers around the house.
- Followed up by phone with each viewer to obtain constructive feedback.
- Received an offer and forwarded it to the vendor by letter.
- Negotiated the offer, over several phone calls, to achieve the desired sale price.
- Progressed the sale, via phone calls and emails to the vendor, the buyer and the two solicitors.
- Reassured both vendor and buyer when the property was down-valued slightly, and kept the deal on the table.
- Eased both solicitors to a successful Exchange of Contracts, despite their propensities to drag their lawyerly feet.
- On Completion day, checked monies received, handed over keys, gave buyer a welcome bunch of flowers and new home card.
That’s 16 steps, without any real issues, chain difficulties, survey problems, funding challenges, or arguments about whether light fittings are included. And for all this, the agent was asking for of £4,500. A bargain, I think.
The agent did exactly what he promised, and found a speedy buyer willing to pay the asking price in less than a week. It’s ironic really, that the vendor then thinks he hasn’t done anything for his fee. Is she actually saying that she would have been willing to pay more if her property had languished on the market for months, struggling to achieve interest, and eventually sold for a discounted price? I think not.
Unpack your service
If Mr and Mrs Joe Public don’t know what you do for your service, it’s your fault. You have to tell them what you do. You need to educate them. Unpack your service so they know all the hoops you jump through to get them to where they want to be – in their new home.
You can use your blog, if you have one, to unpack your service, explaining what you do, and how you do it. Once you’ve received the signed Agreement, tell your new client exactly what you’ll be doing next to help her house sell. In your marketing material, include a kind of flow chart, to show the process of marketing, negotiating and selling a property. Hold an event for vendors, describing the journey that vendors and agents take to make it work. And basically use all the media available to you to get the message across to the public that what you do is difficult, and complex. Because it is.
It’s your responsibility to make sure your clients know exactly what you do for your fee, and why it is such good value for money. Use the powers of show and tell to ensure that you never get a call from your client’s solicitor on Completion day, questioning why they are paying a fee for a service they don’t feel they received.
What to read next: Give Yourself a Head Start in the Valuations Race
What to do next: Do you get my Supertips? They’re jam-packed full of great tips and marketing strategies just like this one, and best still – they’re free! Get yours here ->www.samashdown.co.uk/samsupertips
Speak to Sam: If you’d like to know how I think you could improve your marketing, just answer a few short questions here and I’ll tell you if and how you could be more effective.
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