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Day dreaming of a White Christmas

Year-end pointers for progressive estate agents.

This issue of Estate Agency News has probably fallen into your hands during a time when you actually have time to read it! It may have been a bumper year for estate agents across the country, but even booms take time off over Christmas. So what are you doing with your time right now? Hopefully relaxing and sorting out those things you have been putting off over the year.

However, are you combining that sedentary task with some grown-up forward planning? Many agents I have spoken to over the past year have told me that they have been so busy selling property that they have scarcely had a moment to sell themselves.

They all agree of course that they “should” be working on their image, developing marketing material, generating creative mailshots, and getting themselves mentioned in the press, but they are naturally more focussed on their core activities such as valuations, take-ons and showing.

Mention “advertising” and many agents will say they are generally pleased with the local paper. Their ads are well designed, the phone rings, and clients are impressed, so what more could they possibly need? When I ask them that very question, “what would you like more of?” they invariably tell me “instructions” without hesitation. And yet the ads continue, week in, week out, to be focussed almost exclusively on attracting purchasers!

I know of no other business that has so much opportunity to develop a direct revenue generator, yet puts so much money into capturing an indirect secondary one. Indeed, even though there is broad agreement that instructions are the key to success in estate agency, there seems to be very little effort put into creating distinctive agency messages that appeal powerfully to vendors. Most agency websites have some sort of facility for buyers, but offer very little to sellers - the lifeblood of an agency.

The irony is that despite the fact that so much expense is put into attracting buyers, they are not generally regarded as a valuable resource, or used as such, once they have been captured.

So things seem somewhat back-to-front in my view; and this runs through to training as well. When times are good, the feeling is “we haven’t got time to train our staff, and we must make hay whilst the sun shines”. As soon as the market softens, I suspect the sentiment will be “Training? In this market we haven’t got time to train. Our people must be out there converting every opportunity they can find if we are to keep our heads above water”.

Personally I’d rather work smarter, not harder, in order to maximise opportunity and defeat the competition, and this applies to both marketing and training. Many agents feel that they are being smart by being pro-active - meaning they simply put their head down, get out of the office, and go for it. Whilst one has to admire their stamina and their resolve, one should also question how sustainable are their efforts? Will they burn out, and if so, how easy would it be to replace them ?

Maybe I’m just lazy, but I would rather create an environment where my prospects ring me. I’d rather develop skills in my staff that would ensure every listing was a sole agency at a saleable price, and certainly at full commission of at least 2% (even this derisory figure sticks in the throat!).

Ultimately, it’s all about creating distinction. Vendors have immense choice in the market. Anyone who picks up the property pages of the local newspaper can select from dozens of agents, and might invite a handful to do a valuation. If your agency is to be chosen by anything other than luck of the draw, or the subjective appeal of your colour scheme, you need to demonstrate the specific identity and personality of your business.

Of course, the next question the seller asks is “how much do you charge” and we get into the old commission war, which is inevitably a downward spiral caused by weak agents over the years. The reason why sellers ask how much commission you charge so early in the conversation is that you have given them nothing else to consider. If they really wanted to do business with your agency as a preference, then price would be less of an issue. But you need to give them reasons. And you need to have given them those reasons not just at their time of sale, but in the months and years beforehand as well.

This time of year might also be the right time to reflect on how you work with your buyers. British estate agents are probably the least proactive on Earth when it comes to converting this resource into profit. I often hear negotiators saying “Do you want to go on our mailing list?” to a prospective purchaser on the other end of the phone. I bite my lip and restrain myself from blurting out “No I don’t want to go on your flaming mailing list. I want to buy a house”.

It seems we put a lot of barriers between the buyer and the house. Property particulars are another. If we have a buyer, and we believe we have a suitable house, why do we believe we have to send the details to the buyer before they can see it? It is as if we are scared that the property might not be suitable so we are doing the best we can to put the buyer off first. A well-trained agent knows how to pre-qualify a buyer. A pro-active well-trained agent knows exactly what the buyer is likely to buy, then physically takes the buyer around suitable properties until a deal is done.

Not rocket science really, but if any reader out there knows why it is that some agents feel compelled to follow time-honoured conventions rather than sustainably harnessing their reputation and converting opportunity into profit, then I would be most interested to hear. Happy New Year.