Every now and again I come across a seller who is only interested in the real estate agent who will work for the lowest fee. They are simply shopping for what they consider the best price. Any real estate agent with any length of experience can tell you that they have had this conversation. What I can say, is that I can demonstrate what it is that I bring to the table for my seller clients. After that conversation, price rarely becomes an issue.
The two phases sellers must comprehend prior to listing their house.
If a seller does not fully comprehend these two phases, then the value component becomes scarce and hence price becomes an issue.
First, sellers need to believe in the value of the real estate industry.
Second, sellers need to see the power of an experienced real estate agent.
Understanding the important distinction between the real estate industry and the individual real estate agent is integral to the concept of “price is the issue in the absence of value”. When a home seller doesn’t see the value in hiring an agent, that’s when they’ll want you the agent to compete based on pricing or “the commission”. The homeowner is essentially saying, “I don’t see the value of a real estate agent, so tell me how much you charge (without understanding the services that come with the fee), because “I’m just going to hire the least expensive one.”
The first part of the seller conversation should be ensuring that the homeowner recognizes that they need to work with an agent. They need to see the value of the real estate industry and why using an agent, any agent, is in their best interests.
Statistics and Numbers
Statistics and Numbers can be your friend or your enemy. In this scenario, the numbers clearly support the value that the real estate industry brings to the table. According to the National Association of Realtors (NAR) Study of Home Buyers and Sellers, the typical For Sale By Owner (FSBO) home sold for $260,000 compared to $318,000 for agent-assisted home sales. When I am sitting across the table from a seller and we have this conversation, typically we are on the path towards appreciating the value of the real estate industry. And more so, given the local average sales prices!
So this usually leads to the second part of the equation where I get asked, “Why should they choose me over any other agent?” I usually respond with the chef analogy.
The chef analogy
I usually ask if they have seen one of the seemingly endless streams of reality chef competitions on television. In these shows, each chef is given the same tools and the same ingredients. They use the same kitchen, the same pans; everything is identical. Everything is identical except the dishes they prepare — those end up very different from one another due to the personal creativity of the chefs. Personal creativity is rarely the same between a group of people.
The real estate industry is a lot like those chef shows. Every agent in any given market has access to the same MLS, the same internet, the same social media outlets, flyers, lockboxes, open houses, etcetera. Everyone has the same tools of the trade, but it’s not about the tools that the industry has at its disposal. It’s all about how I use those tools that set me apart from my peers.
Using the tools.
And this is where I tie the real estate industry and the agent into believers of the value that I can bring to a seller. We usually have a conversation where I show a seller how I use the MLS, explaining the importance of details in a listing. The details in the room dimensions, the listing description, what is included and excluded, and so forth. I discuss how I take photographs and how they are so important in turning a view into a click. Once I discuss how I market compared to other agents, and how I leverage social media to showcase a home, my use of well-edited photographs my value proposition has crushed the need to price shop. And all of this happens before we get to the 180 plus tasks that I need to get through after the offer is accepted.
Content credit has to go to Inman News for the inspiration of this article.