Talking to a team of agents on the Gold Coast recently, I asked them to picture a football team who has been playing on a dry surface for the last few years when all of a sudden they have a wet, rain-affected pitch to play on.
If the players don’t adapt their game, they will lose. In that game, there will still be a winner and a loser, but it’s the team or player that adapts to the conditions who will always win. The rules of the game are still the same, the ball is still the same, but the conditions have changed.
It’s the same in this marketplace that we are now faced with; there will be winners and there will be losers. People will still buy homes, regardless of the market.
But remember – market conditions only affect you if you have 100 per cent market share. I might go to an office and someone says to me, ‘The market’s stuffed, Macca!’ But if you only sell two out of 10 houses in your area anyway, then if you lifted and sold four out of every 10 houses you would tell me, ‘It’s the best market ever’. So stop focusing on the market, and start focusing on the opportunities that exist on the different playing ﬁelds.
You can no longer rely on the marketplace to give you the sense of urgency that you once had. In a real estate business, the offices that will win in the long term are the ones that control internal energy and don’t rely on external energy. Internal energy is created by awareness and functionality around the key metrics that drive your business.
This is what I can guarantee you: Every owner will accept less than you know. And every owner will take less than they know.
If you cannot control your clearance, then your energy inside your business will drop away dramatically. Clearance is a controllable factor by a combination of process and detailed information delivered to the owner in an empathetic and professional manner.
Days on market
When the clearance rate drops, your days on market rise; it’s like a seesaw as one affects the other. I believe this to be the most inﬂuential number in a real estate business. If you let your days on market blow out by 10 days, your turnover clearance drops by 30 per cent.
It’s a no-brainer that you need to raise your proﬁle in traditional channels across digital, newspapers and social media. However, as the market changes the most inﬂuential proﬁle is the Sold sticker proﬁle and your ability to demonstrate to your community that you can shift property regardless of the market.
Every agent I know needs to manage their own expectations too. In this market, agents simply cannot ‘expect’ inquiry to come. Organic traffic is what the market serves up and what many of you have been expecting for the last ﬁve years. Now you are going to have to drive traffic to your stock. Do not expect a price reduction without evidence.
Quality, structured feedback with empathy for the owner’s situation is critical to work through this. What never ceases to amaze me is that if an owner has a piece of stock with an agent for a long time, they often say they never, ever saw an offer, let alone a rude offer. Those vendors are effectively saying that their agent lacked the skill to ﬁnd an offer. The trust of the vendor is gone, and therefore a price adjustment never exists.
Finally, this is what I can guarantee you: every owner will accept less than you know. And every owner will take less than they know.