Does it interest you to make more real estate commissions on your sales? Dumb question isn’t it? Of course you do. That’s one of the reasons you seek out information on real estate training, and why you’re reading this article right now. You obviously understand that giving greater value to your clients leads not only to the likelihood of selling more houses, but also increases your opportunity of getting paid more commission when you do.
When I say more commission, I mean more than what discounters are getting and possibly even more than what most agents charge. One of the things I tell agents I coach is that cost is only a factor in the absence of value. Think about that statement. What is it that most home sellers really want? Well, bottom line, what sellers want is buyers, but beyond that, they crave a valuable experience when working with a real estate agent.
When you have systems in place that go over and above what a Seller can get on their own, or get from other agents, you can easily get paid more on each transaction. But let me caution you on this – if you are not delivering on that value, you are not necessarily entitled to that upgraded fee. When you make a promise, you need to deliver on that promise. According to many industry studies – commissions are not ranked very high on a Seller’s list of priorities. What are high on the list are top price, their time frame and a hassle-free process. So if you can demonstrate to a Seller how your system can help them accomplish all of those things better than any other agent or team, and better than them doing it all by themselves, you are on your way to collecting your fee.
The other thing I want you to think about is the dead end that commission discounting represents. The fact is that discounting commissions to get business is not a sustainable business model. Why? Because no matter how low you are willing to go, there is always another who will go lower. It is tough to provide higher levels of service and value at lower discounted commissions. So how do you get out of this vicious circle? Well, you demonstrate value.
Having a discussion up front about how the Seller plans to select an agent to help them is a great way to get started. As well as asking the seller what is most important to them in getting their home sold, and what they feel needs to happen in order for this to be accomplished. This will give you the opportunity to demonstrate the value necessary to not just get the seller's business, but also an upgraded fee for your service. You must demonstrate to them that paying you will net them more money: i.e. put more – not less – money into their pocket at the end of the transaction.
Understand that simply telling them this is not demonstrating value. Remember, “show me” is far more powerful than “tell me”. Of course you are still going to verbalize the value (i.e. speak it), but you have to make your words come to life. Use tangibles and real life items that a Seller can relate to and draw logical and emotional conclusions from. An example of this is presenting the seller with superior stats, your track record of experience, and a detailed description of how your system delivers better service and results.
Here’s an example of how you might position your superior stats: “According to industry statistics, Mr. & Mrs. Homeseller, our listings sell for 2.2% more money than the average area agent's. So, if your home is valued at $300K, this is $6,600 more. That also translates into a lot more profit. If you have about $50,000 in equity, then that means I am likely to net you 14% more profit. Would you consider 14% more profit to be valuable?” Then you carry this over the top by demonstrating how much more likely it is that their home will even sell at all with your system by saying something like, “Mr. & Mrs. Homeseller, according to those same industry statistics, the average area agent only sells 42% of the homes they list. According to those same statistics, we sell over 85% of the homes we list before the expiration date. That means your home is more than twice as likely to sell, and to sell with 14% more profit when you list it with us. Why would you gamble with something so valuable when there really is no reason to?” Point made and value demonstrated.
If you have done a good job of “demonstrating value”, the seller will not only say yes to doing business with you, but you will also be in the enviable position of getting a very fair fee for the extra service and value you bring to the seller. The Seller will willingly pay you and thank you for the extra value, services and efforts in getting their home sold.
We hold many free, half day seminars across the country if you want to learn more about my system and you can search the current schedule here.
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