One question that can be difficult to answer honestly is whether clearance rates and days on market are a reflection of the market or a reflection of your business.
Undeniably, economic shifts and global influences have made our industry more difficult and it would be all too convenient to suggest these business indicators are out of our control.
Yet, these same marketplaces are dotted with stories that defy the odds.
Bringing stock to market, finding buyers and crafting deals while others are struggling.
Is it possible that there are just one or two ‘lucky’ postcodes that are unaffected by these struggles?
Or are these results a reflection of a process that not only defies a marketplace, but creates it?
Josh Tesolin is a different kind of agent.
He’s individually listed and sold more residential properties than any other agent in Ray White’s history in one financial year.
He’s a volume agent working in the middle class suburb of Quakers Hill in Sydney’s north west.
From an outsider’s view, Josh doesn’t seem to struggle the way other agents do.
From the inside, you’ll find his struggles are amplified, not merely off the back of his own expectations (or those of others), but when a volume listing business struggles to clear stock, this starts to compound to a big problem, very quickly.
An increase in days on market by merely 10 days will decrease a business’s output by more than 30 per cent.
So when Josh and his team started to see pressures on prices, deals falling over, and buyers’ confidence waining, he knew he had to react quickly.
Josh had several listings in June, with only one auction listing, which sold under the hammer.
Nearing the end of the month however, Josh faced the same battle many other agents face with private treaties.
There were six rescissions on contracts, from bank valuations coming in short to buyers wanting to ‘wait’ for the market to stabilise.
Josh made a few calls to several of his coaches and mentors to talk about his frustrations.
All of them resounded with the same comment: “You know what you need to do.”
The same day Josh called his auctioneer and proclaimed: “We’re converting everything to auction!”
“There’s nothing wrong with selling prior to auction – if you’ve got interest and a good price the vendor is happy with, by all means sell,” Josh says.
“But listing the property as an auction means auction rules apply. There’s no 10 days waiting around – on edge – for a rescission. You have your result.”
The first leg of auctions were booked for two weeks on Sunday 3 July. Eight auctions were booked in.
Two sold prior and the remaining six sold under the hammer. Listing and converting the remaining stock to auction then became easy.
Over the first four weekends of July, Josh has currently sold 21 of 23 listings (a 91 per cent clearance) with six average bidders – double the current average.
He also has a further 20 live auctions due to run over the next few weeks, continuing to back the process.
Speaking on why he thinks auctions were so successful, Josh said, “With private treaties, there’s no urgency.”
“They can view the house several times and crucially, the cooling off period allows them to withdraw. Auctions create a sense of immediacy – 30 per cent of our buyers at auction during July have seen the property for the first time that day.”
The decision to change everything to auction achieved more than simply a change in method.
It changed the process of listing, educating and selling, providing confidence to buyers and sellers in a marketplace that needs it.
Josh changed up the following processes:
The process of pricing property:
- the price was removed from marketing
- properties were marketed using the motivation over price
- vendors of future auctions would attend current auctions to watch results.
The process of selling to all buyers:
- buyers were invited to attend all auctions
- they would watch auctions to learn the process
- they would see results first hand to learn prices
- they would miss out on properties within the same day, ready to buy the right property after a fear of loss.
The process of listing:
- pipeline and past appraisals were invited to auctions
- saw activity of buyer traffic and active bidders
- saw demand of buyers in their marketplace
- able to compare with opens and auctions they saw from competition.
Utilising Facebook Live and media:
- Live streamed auctions to Facebook, averaging over 70,000 impressions. These eyeballs on successful auctions gives his clients confidence in the market.
- Considerable media attention (three television crews in a month covering successful auctions) has countered the current ‘doom and gloom’ narrative>
People will list with you because of your energy, but they will sell with you based on your skill.
Josh represents but one of many examples of how in any market place there is an abundance of opportunities to create your own luck.
In a booming market place, agents wanted to list auctions.
Now the market is showing signs of turbulence, we need auctions.
The transparency of the process provides the education and evidence around pricing for both buyers, sellers and future sellers.
It creates confidence to a market place that is otherwise paralysed in fear created through the media.
It is a process that, with the appropriate training, support and teamwork is allowing agents to shine amongst their peers and grow through a challenging market.
