Part one is all about the listing process and is the most critical. Many organisations adopt other forms of sale but all rely upon recent auction results to formulate their asking price. Unrestricted and open competition set the benchmarks on which all comparisons are formulated.
Auction is the primary method of sale for the nations leading agents. Many other real estate practitioners adopt an auction campaign on occasions but do not achieve the desired result because they do not understand the process. Worse still, some agents abuse the auction process by overpricing and under-quoting, deflating the virtues of this great system. Thankfully the Office of Fair Trading has taken enormous steps to combat this abuse and once again instill confidence in the process. Auction is a wonderfully uncomplicated format which, when undertaken properly, will benefit all parties involved ” sellers, buyers and agents.
In this three part article, I will attempt to outline the steps necessary to create a successful auction campaign so you will not only sell more property but improve your profile locally and have very satisfied clients.
Auctions are designed for property owners who wish to sell their properties in a timely fashion and who are prepared to accept current fair market value. Certainly, there are occasions when an auction will generate results well above vendor expectation and in turn set new benchmarks for property values in that area.
The objective of every genuine vendor is to sell their property for the most amount of money in the shortest amount of time. One of the greatest benefits of an auction campaign is that it sets a specific deadline. It gives the agent and vendor a firm date to work towards and more importantly forces buyers to a decision point–they must act now or lose an opportunity to purchase.
Part one is all about the listing process and is the most critical
Once it has been established that the owner has a genuine reason for sale and they are not just testing the market, an auction strategy can be presented for their consideration.
Discuss openly the benefits of auction:
- Why market without a price?
- Why aim for a specific date?
- Why tell everyone about the impending sale?
- Why let buyers fight for it?
- Why create a mood of urgency?
The basis of an effective auction campaign lies in the advertising. As the old saying goes, you cant sell a secret. A solid marketing campaign is crucial in order to expose the property to the masses.
A vendor must be prepared to expend what is necessary to expose the property to the widest possible target market. Clients are fishing with a big net and you want to find as many buyers as possible who can compete for their property – miss one buyer and the vendor could miss out on thousands of dollars.
Campaign ingredients often overlooked in the clients budget include high quality professional photography and script writing – outlining the benefits of the property and highlighting the vendors motivation for sale.
The ads should be of the highest possible quality in order to stand out from the crowd. After all, theyre designed to make an agents phone ring!
A solid marketing campaign is crucial in order to expose the property to the masses. A vendor must be prepared to expend what is necessary to expose the property to the widest possible target market
As an agent is always working to a strict timeframe, one must have the necessary resources available to ensure that each step of the marketing campaign is performed timely and professionally. Strict compliance issues associated with agency practice now will also be easier to control in a highly focused campaign.
If an agent can list a property at the correct price level for a vendor who wants to sell their property, they can then concentrate exclusively on finding buyers and reporting effectively to the owners.
Part two ” know your client
Before submitting a proposal for the sale of a property, an agent must ascertain what it is a vendor is trying to accomplish. Most agents believe the only things a vendor wants to discuss are the value of their property, the commission rate and the cost of the marketing campaign. Whilst these issues are important, they are not the most critical.
A vendor who is about to appoint an agent will want to know that that agent is a person they feel comfortable and confident with. There is always a reason why an owner is about to sell their property ” the house is too small or too large, they have a job transfer, they wish to move closer to family etc. Once an agent has discovered the reason for sale, they will be able to structure a sales proposal accordingly.
The only way an agent can work out the reason for sale is to ask questions. They should take what time is necessary to build a relationship with the vendors and discover exactly what it is the vendors want to accomplish. That first meeting is a rapport building and fact finding mission.
Most agents believe the only things a vendor wants to discuss are the value of their property, the commission rate and the cost of the marketing campaign. Whilst these issues are important, they are not the most critical.