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Transform 2017 Week 11 Gavin Croft: Understanding the Art of Auction

Here are the highlights from our Super Six session with Gavin Croft.

Coach: Gavin Croft

Key Points

  • Put a market in front of the seller on a set date, and work towards setting up for bidders and buyers rather than ‘the buyer’.
  • Understanding the auction and your role in the process reduces your days on market, and will help sellers make a better decision.

Quote

“Your ability to articulate a market – a lot of agents find that difficult, but when you’re qualifying buyers and you know the buyers and what they’re doing, then you know the market.”

Video Notes/Transcript

I want you to try and understand all the different moving parts of an auction. To be able to aware of everything that’s going on and still be able to understand it and think through each situation is actually an art in itself. It’s not easy and it can only come through time reflection and experience.

If there’s one thing that you can lift your auctions and you can develop auctions as part of your skill set, the better your buyer qualification, the better your buyer work and how you link that to your vendor management is just so critical here.

We talk about speed of information, the quality of information, and the passing and transfer of knowledge to your clients.

This is the game. You have to be at a level that’s so much higher than your competitors.

What I want you to think about is in four weeks’ time, I want to put a market in front of the seller. That’s my sole responsibility and my sole focus. I want to put a market in front of the seller in four weeks’ time.

Check in with yourself that, as you move through an auction campaign, if fear sets in, it’s actually natural. It’s going to happen, but be very careful of the language [that] comes out of our mouth when fear is part of it.

What we tend to do, again, we try and push things onto our vendors which aren’t there. It’s our own internal fear of dealing with auction day. When you can deal with that and be comfortable around it, and be able to lay the landscape out on the table for a vendor, that helps them make better decisions than telling them what they should be doing out of fear for you.

You want to put a market in front of the seller on a set date. We’re working towards the 27th of May, the 25th of May at 2:00 pm, 3:00 pm. That’s what we’re working towards.

If you go around trying to find “the buyer” as opposed to trying gather bidders and set bidders up for the day, it’s going to fall down. It’s a mindset shift, because what happens in private treaty, we’re trying to sell the property, aren’t we? Whereas auction, we’re setting the buyers up towards the day.

It’s a real mindset shift, so we really need to focus and check in with ourselves that we know exactly where we’re going and if we start to falter, bring ourselves back in.

Let’s say, Darin, through one of your open homes, you get a skyrocket of an open home and you get 21 groups through. You ring Mr. Vendor up straight after your open home, and you tell your vendor, “I’ve had 21 groups through,” which is pretty high. It would be pretty high. What are they going to start to think?

The price is going to go one way and it’s going to go up. What happens is, through those 21 people who’ve been through … I’ve got four buyers. 

See the dynamic shift, and how I’m brought back down to earth and I’m dealing with reality? Do you think, if someone hasn’t bid at auction before, they understand what they need to do? They’ve got no idea. They need your help.

The visual element of the auction is the most powerful element that you can have. Don’t ever underestimate it. No bidding or bidding, it is powerful for a vendor, which ties into our next point.

Auction day is simply a negotiation platform. That’s all it is. Relax. It is really straightforward.

Our final piece about what we’re wanting to achieve here is the seller accepting responsibility for the sale. You absolutely have to be crystal clear [and have] absolute clarity around what your role is, and what you’re looking to achieve.

The moment that leaves you and you don’t have the activity, you start to blame the process or the vendor does. You need to be very, very clear on what you’re going to achieve.

The consumer understands that if you tell the Price Guide ‘900’, that means in your agency agreement, it’s 900 or 990. So they appreciate the transparency around that. They really do.

We interviewed 500 consumers at the open home and said, “What helped you make the decision to inspect this property?” I tell you about 498 said Price Guide was very important in their decision in viewing the property.

Once you understand the process, it reduces your days on market, it helps sellers make a better decision and what I find, I find you become a better lister when you do more auctions. The reason you become a better lister is because you understand the market better, because what listing is is your ability to articulate what’s going on in the market.

Your ability to do that better than the next agent and be more competitive in those other areas, that’s the game. Your ability to articulate a market – a lot of agents find that difficult, but when you’re qualifying buyers and you know the buyers and what they’re doing, then you know the market.

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