2020 – Ready to Go

2020 is here and it’s a good idea to revisit your methods of working with your luxury clients. With an election year ahead where a “wait and see” period may take place and more millennials are entering the luxury market, getting and closing more luxury listings is a must.

So how can we increase our “A-game” when it comes to landing more luxury listings, especially when high-end customers are very smart and business-savvy and have a lot of options?

First:

You are not going on an interview. Always assume you have the listing and take the listing contract with you. And remember, the marketing begins at the curb. Prior to discussing price, ask, “Why don’t we take a pre-marketing evaluation tour of your property together?”

Second:

Never again use the word “comp”. Comparables may not be relevant and even if they are the seller won’t care. In their minds, there is no other home comparable to theirs. Instead ask, “Why don’t we take a look at properties buyers will be evaluating at the same time they’re evaluating your home?” Follow with, “Based on buyer behavior, where do you think we should price your home? What is there about your home the buyer could use against us in a negotiation?”

Luxury sellers will have already done their homework and will have a price in mind so involve them in the pricing strategy discussion. And, once listed, be prepared to discuss a strategy if the market does not respond to the price.

Now that you have engaged them in a pricing strategy discussion and you’ve heard the price they want for their home, move forward from a position of strength by taking them through the following three pricing strategies. Begin with stating, “Our company has made a science out of pricing real estate. I don’t want to help you select the highest possible price; I want to help you select the highest realistic price.”

Strategy 1: “Some of our luxury clients want to price their property as close as possible to what the data suggests.”

Strategy 2: “Some of our luxury clients prefer the “less is more” pricing strategy, which is especially effective if you want to sell your home quickly and can even result in bidding wars driving the price up over the asking price.”

Strategy 3: “Some of our luxury clients like what I refer to as a retail pricing strategy. This is where you price your home higher than what the market supports to give you more room for negotiating.

“Of these three strategies, what seems to make the most sense to you, given your circumstances?”

You have now tenderized the client. You are not there representing the data; you are representing them. You want to associate yourself with their vision and needs, versus the data.

Do not say, “We can give it a try; it’s kind of high but we can give it a try.” Instead say, “My motivation is to help extract every conceivable penny from the marketplace for your home.” Now you are more valuable because you are defending them.

Third:

There is a major difference between a salesperson and a closer. Hundreds of thousands of agents have lost listings because at the end they’ll say, “Do you have any questions?” or “When would you like to get started?” or “Boy, I’d really love to represent you.”

A closer would say, “All I have is one last question. How soon would you like to have your beautiful home sold to the right buyer?” This brings a sense of urgency.

Finally…

Stop volunteering to cut your commission. If they bring it up; don’t panic. Just because fees are negotiable doesn’t mean you have to negotiate your fee. Luxury clients want to see value. Show value for the commission paid during your meeting. Commission is really nothing more than a marketing carrot. Turn the contract around, hand them the pen, and be quiet.

I want to encourage you to set an aggressive goal this year to increase your luxury listings and closings. If you need help, talk to us and we will help you. We have the pleasure of working with some of the brightest and best luxury agents in the real estate industry across the nation.

If you want more guidance on how to grow your luxury real estate practice, you can learn more about the Institute’s training options here.